When your online business has gone from strength to strength, you might find that your existing fulfillment process or warehouse is struggling to keep up. This might prompt you to begin searching for a third-party logistics (3PL) provider.
In the e-commerce industry, the use of 3PL fulfillment companies has grown and grown. These services have become incredibly beneficial, especially as online consumers have higher expectations regarding the delivery of their orders. However, it can be difficult to find a reputable 3PL company, especially if you are unsure of what to look for.
This post outlines three of the best questions to ask when searching for your preferred 3PL partner.
How Accurate is the Inventory Management and Reporting?
The accuracy of a 3PL’s inventory management and reporting directly affects your online business’ ability to operate efficiently and streamline fulfillment. As the 3PL partner will almost be an expansion of your business, how it performs could alter your reputation if errors are made.
If the partner you select can manage stock levels correctly, this will ensure you have enough inventory to meet the demand of your customers and avoid issues, such as overstocking or understocking. It will also simplify the decision-making process by providing better data for budgeting, forecasting, and strategic planning.
All of this will have an impact on the satisfaction of your customers, too. Inaccurate inventory can lead to backorders, shipping delays, and/or stockouts, and this can damage customer trust. This is why you should determine how well your chosen 3PL partner will manage and report inventory before finalizing your decision.
What is the Scope of the Warehousing Network?
Businesses should also ask about the warehousing network of the 3PL before choosing which service to partner with. This will reveal how well the service can support your logistics needs geographically and operationally. A 3PL partner should have an effective warehouse location strategy, which will benefit your business in numerous ways.
Not only will having warehouses closer to your demand centers cut transportation costs, but it can also offer faster delivery times. Warehouses that are strategically located mean your products can be stored closer to your customers, which will enable better service and quicker delivery times.
Plus, a broad warehousing network will support business growth and seasonal volume spikes. This can be achieved without requiring large infrastructure modifications.
Is There a Dedicated Support Team to Assist with Issues?
Unfortunately, problems can occur at times, and your business might require assistance from the 3PL company, especially if the issues relate to fulfillment and shipping. The 3PL you select to work with should have a dedicated support team to ensure accountability, as they will be more likely to take ownership of problems and work to resolve them efficiently. This can cause better relationships to form between your business and the 3PL.
A support team should also provide consistent communication throughout the process, and this will only improve as you continue working with them. The more you work together, the more they will learn about your online business. This could result in the 3PL workers understanding your business and anticipating issues before they arise, resolving them in a timely manner.
To conclude, it is important to ask questions and receive sufficient answers before you select your 3PL partner. This is crucial for your online business, so make sure to use the three questions listed in this post.
