Have you ever had a customer complain they expected your product already, but they just placed the order yesterday?
As ridiculous as it may sound, customers are demanding more from businesses now than before. According to Statista, 41% of customers expect to receive ordered items within 24 hours. While 24% expect it to be within 2 hours.
And for growing eCommerce businesses, it can be impossible to meet these demands.
Often, your plate is already full running your business, you don’t have the capacity to manage logistics. That’s why many turn to third-party logistics (3PL) providers to help them with their supply chain management needs.
But what services can you expect from a 3PL company?
In this article, we’ll be discussing 3PLs and the different types out there today.
What is a Third-Party Logistics Provider?
Third-party logistics (3PL) involves external service providers that help manage the supply chain of a business. By working with 3PL companies, you reduce overhead costs, expand your reach to multiple locations, and improve customer experience.
More importantly, you get to focus more on improving and scaling your business.
6 Common 3PL Services
Here are 6 of the most common 3PL services:
- Warehousing & Inventory Management
- Order Fulfillment
- Picking & Packing
- Shipping Coordination
- Customs Clearance
- Returns or Reverse Logistics
4 Types of Third-Party Logistics Provider Services
Before working with any logistics company, it’s vital to know the different types of providers available. This way, you’re hiring the right 3PL for all your logistics needs.
Here are the top 4 types of 3PL providers:
#1 – Standard 3PL Provider
The most basic of 3PL providers, the Standard 3PL only offers storage and transportation services. With such limited services, they are often the most cost-effective option. This makes them ideal for small eCommerce businesses that are just starting out.
#2 – Service Developer 3PL
Aside from providing basic 3PL warehouse and transportation services, a Service Developer 3PL company can also offer shipment tracking, cross-docking, package selection, and compliance management. This includes ensuring that your refrigerated goods, finished products, and raw materials are properly stored to avoid damage.
In other words, if you want enhanced security, more transparency, and better technical support in your logistics services—then you should consider this one.
#3 – Customer Adapter 3PL
A Customer Adapter 3PL provides beginning-to-end supply chain management services. This means that they do everything from inventory management to shipping coordination and order fulfillment.
Beyond all that, they can also negotiate prices with carriers, create personalized packaging, and inspect products before shipping to the customers.
Pro Tip: Look for a Customer Adapter 3PL that can customize its services according to your needs. In doing so, you only pay for what you need and gain the freedom to increase your logistics capacity as your business grows.
#4 – Customer Developer 3PL
While the previous 3PL services function as a separate entity from the business, the Customer Developer 3PL is an integral part of the company. Essentially, it acts like its logistics department, handling the entire logistics operations from start to finish.
Because of this, they have more data and insight into your operations. As such, you can expect them to provide reports and recommendations on how to optimize your logistics.
Pro Tip: Since Customer Developer 3PL has so much control over your logistics, it’s best to partner with one that has an established reputation in the industry.
With customers expecting shorter delivery times, 3PLs are a convenient solution for eCommerce and growing businesses. They offer secure storage, handle distribution and transportation, and even manage your entire supply chain. In return, you save on overhead costs, enhance customer experience, and efficiently scale your business.
Looking for a reliable 3PL company to work with?
At San Legend, we help eCommerce businesses scale their brands and break into new markets by providing customized, agile, and forward-thinking third-party logistics solutions. Reach out today to see how we can help.