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Since last year we've seen a growing trend of brick-and-mortar businesses extending their reach and shifting to selling their product online. Some companies that had already been selling products online saw phenomenal growth during this period leading them to need help with managing it all.
What is a 3PL?
A 3PL is a Third-party logistics provider that you can outsource your warehousing, logistics and distribution and fulfilment to so that you can focus on the big picture things.
What types of businesses use 3PLs?
Businesses of all sizes and types use 3PLs. Business to consumer, business to business, the list goes on. Amongst our clientele who make use of 3PLs, they are businesses who sell items such as:
- Protein and supplements
- Eco-friendly products
- Creative displays and signs
- Pet food and accessories
- Fashion and apparel
You may feel that you won't have a great need for a 3PL just yet if you're just starting out. You may be using Excel for your inventory management. You'll be taking great pride in picking and packing your own orders, and you'll love all the control you have over all facets of your business - Until you don't. Fast forward to when the business honeymoon phase ends, and there's been some extreme growth. You'll be stressed out of your mind and so will your staff. Orders will be backing up, there's a mountain of unhappy customers, and you realise something needs to change. It can be challenging to recognise when it's the right time to seek help. Looking at your current situation and then looking forward to where you want to be will help develop a plan of action. There are several reasons for outsourcing to a 3PL, but below are our top 3.
Reason #1 - Expansion of your business - Either nationally or internationally
You've had exponential growth, and you want to step into new markets. To facilitate this growth, you'll need to ensure you have effective distribution routing of your product. But the problem is you're not a logistics expert, time is of the essence in fulfilling orders, and you're unsure how to get your product to these new markets effectively. You will be missing out on growth opportunities. Having a 3PL can ensure your product is picked, packed and shipped efficiently. They are experienced at taking care of all that is required for international logistics, such as documentation, customs and duties.
Reason #2 - You're overwhelmed - Struggling with the day-to-day running of a warehouse
With more product on the move, it's harder for you and your staff to keep up. The warehouse is unorganised, everyone is stressed, and worst of all the customer complaints and negative reviews are piling up. Poor inventory management leads to all kinds of issues, from perishing products to overstocks. Using a 3PL provider takes the stress out of those day-to-day operations. They have experienced warehouse staff that can competently execute those daily functions for your business.
Reason #3 - Increasing costs - Causing a dent in the bottom line
How wonderful when you have more sales and product on the move, but that may mean more staff, a bigger warehouse, and more equipment - essentially more costs. When these costs are constantly increasing, it's time to think about outsourcing to a 3PL. They are the experts at order fulfilment and have the partnerships and networks to provide cost-effective freighting and shipping.
Although you may be reluctant to relinquish control of these functions in your business, you can't be across everything at all times. A 3PL can meet your business requirements by leveraging their systems and technology. They will free you up to focus on developing the products and the business rather than getting bogged down by the logistics side of your business.
If you've been thinking about outsourcing to a 3PL, let us help. We can guide you through the decision-making process.