Choosing a 3PL Partner for Small E-commerce Businesses

As consumer behaviors and expectations change with each day, e-commerce businesses must prioritize their capabilities to maintain a competitive edge. 21^st-century buyers have hundreds of options at the distance of a few clicks, leaving little to no room for e-commerce businesses to compromise on the quality of their products and services.

One way to dominate today’s ecommerce landscape is by offering reliability and ease to the clients. However, setting and starting up an e-commerce business involves seamless management of myriad operations, and logistics is the most crucial. The success of a small e-commerce business depends on how quickly the order is processed and delivered to the client.

If you want to boost the profitability of your small ecommerce venture, using third party logistics is an excellent way to reduce overhead and operating costs. However, not all 3PL companies will cater to your demands; only choosing the perfect one will be profitable. Following are some aspects to look for in a 3PL company to take your small e-commerce business to the next level.

Analyzing Business Needs

To make your 3PL outsourcing worthwhile, critically analyzing your business needs happens to be a crucial step. This means checking the daily orders, product type, client location, and warehousing requirements. Ideally, you should be looking for a 3PL partner who also offers transportation and delivery services, which ensures on-time deliveries to your clients. Remember, some 3PL companies are exclusive, so select a 3PL partner with experience in managing your product’s logistics.

Conducting Thorough Research

To choose the right 3PL company for your business, conducting thorough research beforehand is an unmissable step. By critically analyzing the 3PL offerings with top metrics of your business, you will realize that not every company will fulfill your needs. Study each company profile, see their recent client reviews, and check their market rating. It would be nice to prepare a list of options you are looking for, contact 3PL services, ask questions specific to your business, and then make a choice. Remember, the right 3PL partner can boost your sales and increase business profitability. Conversely, if 3PL services are not aligned with your business goals, it can be detrimental to your business.

Technology

The basis of an e-commerce business model is technology, so it’s a no-brainer to select a company that uses robust software to manage logistics. Before deciding, ask them about the software and technology they use to ensure smooth logistics. A good 3PL company will have at least the following three software;

1. Warehouse Management Software (WMS)
2. Inventory Management Software (IMS)
3. Transport Management Software (TMS)

As their names suggest, they are essential software for streamlined logistical operations. Also, check for real-time tracking options as they offer extra peace of mind.

Manageability

The whole point of hiring a 3PL partner is to satisfy existing clients, enter new markets and win new clients with minimum effort. Selecting a 3PL partner who can fulfill not only current business needs but also future ones can be highly beneficial when entering new markets. If a 3PL company lacks scalability features, it’s best to avoid such companies as it would only slow your business’s growth.

Safety & Security

3PL companies are responsible for the safety of your products while in warehouses or transit. A company offering guarantees regarding safety is generally a safe bet. The best way to check it is by asking for the safety protocols manual or other documents.

Small e-commerce businesses are growing worldwide, and the success of any ecommerce business boils down to the value offered by its 3PL partners. However, only the right ones will be beneficial for your business. Therefore, select a 3PL partner by considering the above-given aspects and see your business grow exponentially.