3PL VS. 4PL, What Are They?

3PL VS 4PL, What Are They?

3PL vs 4PL, what are they? How do they differ? What can eCommerce businesses stand to gain or lose by using one over the other for their fulfillment needs? We hope to shed a little light on which type of fulfillment company you should choose for your business needs. 

What is a 3PL

Third-Party Logistics is an industry term most are familiar with. For companies looking to outsource their entire logistics process, 3PLs are the answer.  They are able to handle the management of receiving, inventory warehousing, packaging, and shipping services, letting eCommerce businesses focus on other important areas of their company.  Some 3PL businesses offer additional logistics services known as value-added services.  These include inventory management, kitting, assembly, and more.

What is a 4PL

Fourth-Party Logistic Providers act as consultants.  While their services are similar to a 3PL, they lack the physical means to move inventory through the supply chain themselves.  Instead, a 4PL will contact and negotiate services between the necessary companies on your behalf.  4PLs are often used when an eCommerce does not have staff to oversee transportation and logistics operations. 

3PL VS 4PL: Main Advantages

The primary distinction between 3PL VS 4PL is that a 4PL manages the whole supply chain and does not provide any physical warehousing or assistance.  A 4PL will instead coordinate multiple services, including 3PLs, to aid your eCommerce. A 3PL, on the other hand, is primarily focused on the logistics management process and personally provides physical warehousing, logistics, and value-added services.

3PL VS 4PL is a heavily debated topic within the eCommerce and logistics industries for which option is ultimately better.  The truth is, each one is meant for different situations and business needs.  Understanding the key differences between 3PL VS 4PL will ultimately affect your company on the bottom line.

The Benefits of a 3PL

There are several benefits to working with a 3PL partner. Firstly, they provide the skills and expertise required for enhanced performance in areas like fulfillment, transportation, and logistics. Through established networking relationships and expert knowledge in the fulfillment sector, 3PLs can upgrade your systems and simplify your overall operation in terms of efficiency and cost. Additionally, 3PLs can provide insight into obstacles that arise during shipping operations, day-to-day fulfillment, or even customer service. 

Scalability

Partnering with a 3PL provides flexible warehousing that can scale according to the needs of your eCommerce.  Depending on your order volume, a 3PL partner can scale operations and inventory space up or down to provide everything your eCommerce needs, and nothing of what you don’t. This is essential for seasonal eCommerce businesses. 

Shipping Solutions

With networking partners and insider shipping solutions, a 3PL can provide the best bang for your buck when considering order shipment for your business. Your 3PL partner can negotiate better pricing based on their high-volume purchasing power. Without a 3PL partner, your eCommerce faces stiff prices named by private shipping companies and little to no cost advantage over competing eCommerce. 

Control

A 3PL partner offers a balance between management and personal control over your eCommerce.  Your business can fully automate the fulfillment process without sacrificing customization or control.  Work with your 3PL to personalize your fulfillment process and make it the perfect fit for your eCommerce while maintaining package customization, person-to-person communication, and brand experience.

Although partnering with a 3PL can result in considerable time and cost savings, giving up control of the delivery process can be tough for some eCommerce owners. Similarly, a 3PL partner can save businesses money in the long run, however, they often have larger upfront costs compared to in-house fulfillment and other options.

The Benefits of a 4PL

Many 4PL partners provide comprehensive technology solutions which can be a critical component for eCommerce and their supply chains. Knowing that your entire logistics process is handled by a single point of contact allows you to sit back and truly watch the backend of your business seemingly run itself.

Vendor Management

A 4PL partner serves as a single point of contact for your entire supply chain. This means there is no coordinating between multiple suppliers, waiting on hold, resolving issues, or finding new partners when one falls short.  Instead, your 4PL partner will do all the planning and communication on your behalf while you focus on other aspects of your business.

Supply Chain Visibility 

A 4PL can assist you in developing and implementing cloud-based systems that collect data from a variety of external and internal sources. This sort of system offers valuable insight into all aspects of your supply chain from a single dashboard. End-to-end supply chain visibility allows you to know where your inventory is at all times and provides transparency over each of your supply chain partners.

Data Solutions

Data solutions are used by 4PL partners to track fulfillment and monitor conformance to standardized regulations, ensuring efficiency from on-the-road operations via invoice accuracy and payments. Additionally, 4PL partners contribute to the overall quality and accuracy of shipping data via data certification, data integrity checks, and ongoing data maintenance. One of the most significant downsides of utilizing a 4PL partner is how much eCommerce must rely on their 4PL once integrated. Typically, these suppliers provide key services that, over time, may reshape an organization's entire supply chain and build a reliance on them. Working with a 4PL can also be costly for small and medium-sized eCommerce businesses.

At the end of the day, it’s important to look at your business and determine which logistics partner would be the best fit for you.  Although both are great options, one provides advantages the other will not.  A 3PL works well for growing businesses interested in working alongside a single logistics partner while still maintaining adequate control and personalization.  A 4PL is geared toward established eCommerce businesses looking to fully automate their entire logistics platform through a single point of contact.  What businesses sacrifice in control and personalization, they make up for with efficiency and optimized supply chain performance.  When partnering with Falcon, you receive full transparency, professional fulfillment services, and above all else, you retain control.  Talk with one of our agents today.

 


How a 3PL Partner Helps Create a Sustainable Business

How Does a 3PL Partner Create a Sustainable Business?

Sustainability has been a growing concern for many consumers and companies alike.  Fortunately, the 3PL industry has been paving the road toward sustainability in an easily obtainable way.  In this article, we’ll be outlining how a 3PL partner can create a more sustainable business for your eCommerce and save you money in the long run.

Reduce Transportation Emissions

Transportation contributes significantly to growing greenhouse gas emissions. A 3PL partner can provide strategic transportation solutions for eCommerce.  3PL partners help eliminate unnecessary transportation stages. They have the ability to convert transport from air freight to sea freight—by shifting inventory to more optimized locations and using the most efficient co-loading routes. Furthermore, working with a 3PL boosts the fill rate per transport unit per tank of gasoline. This allows you to use higher capacity trucks and offset routine vehicle maintenance that would otherwise fall on your shoulders.

Learn about Falcon's eCommerce Shipping Solutions.

Transition to Sustainable Packaging

While cost-effectiveness and safe delivery have traditionally taken precedence over sustainability, many eCommerce businesses are rapidly resorting to eco-friendly packaging to reduce their environmental impact and fulfill rising customer expectations. A 3PL partner can help eCommerce by sourcing packaging materials that are optimized, greener, recyclable, and responsibly sourced. With the expansion of eCommerce shipping, it's critical to work with a 3PL that adheres to environmental standards, assists in lowering packing and disposal costs, and helps your eCommerce meet and hold the same standards as your shoppers.

Learn more about transitioning to sustainable packaging.

Optimize Energy Usage

When operating a warehouse, significant amounts of energy are used. Lighting, extensive warehousing equipment, IT infrastructure, temperature regulation, and other elements are included.  All of these factors lead to high energy usage, operating costs, and an expanding carbon footprint. The right 3PL partner will aid eCommerce companies in reducing their environmental impact via optimized warehousing. This includes; energy-efficient floor designs, solar panels, sustainable packaging alternatives, responsible waste removal, and much more.

Learn how Falcon optimizes energy.

Aid in Reverse Logistics

All procedures involving the reuse of products and materials are referred to as reverse logistics. This includes recycling, refurbishing, and reselling returned items. In reverse logistics, the product is transferred from the buyer to the manufacturer before being disposed of or repurposed. Working with a 3PL can help your company practice reverse logistics effectively and significantly minimize the carbon footprint produced by returns and discarded items.

Final Thoughts

Keeping up with the continuously evolving eCommerce industry is challenging, especially with the increasing pressure to become more and more sustainable.  When you partner with a 3PL, things get easier.  Knowing you have a reliable partner to help your eCommerce reduce overall transportation emissions, adopt sustainable packaging, optimize energy usage, and aid in reverse logistics is a stress relief that every business owner needs.  Get in touch with Falcon today to discuss how we can help your sustainability.

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Q2 eCommerce Trends of 2022

How are eCommerce Trends Changing

The pandemic of 2020 pushed the world into faster technological advancement. Typical growth rates of 13-15%, shot up to 31% growth in 2020. Now, three years later, we can expect faster advancements, delivery, and speedy checkouts. Each quarter we see a new wave of eCommerce trends that will affect the bottom line of businesses around the world. Let’s review the eCommerce trends of Q2.

Compared to eCommerce Trends of 2022

eCommerce Trends of Q2

The eCommerce Landscape is Becoming More Competitive

By the end of 2022, eCommerce accounted for 20.4% of worldwide retail sales, up 10% from five years previously. This fast expansion of eCommerce is linked to a variety of factors, however, Covid-19 is the most prominent.

Credit: Statista

When stay-at-home orders began in early 2020, businesses made a swift transition into the online world. This technological jump pushed companies and consumers alike into a buying journey they had never experienced, which ultimately ignited the ever-burning flame of digital shopping that we continue to see today.

Three years later, and despite brick-and-mortar retailers are making a comeback, eCommerce remains supreme. Because of the rise in online shopping, thousands of eCommerce retailers sprung up almost immediately after the pandemic began. This trend shows no signs of slowing and with each passing year, the eCommerce sector becomes more crowded and more competitive than ever. Successful startups are becoming more difficult to manage, and established eCommerce are encountering more frequent and aggressive competition. As newcomers drive pricing down to attract buyers, established retailers struggle to maintain market share and jobs.

Increasing Advertising Costs and Reduced Campaign Effectiveness

As new eCommerce businesses flood the market, all are vying to find and attract the attention of customers. This raises the overall cost of advertising and lowers the total return on ad investments. For example, Facebook advertising costs 47% more than it did the previous year, and this trend is only anticipated to continue. Furthermore, as a result of Apple's new privacy update in iOS 14.5, cross-app data sharing is now restricted unless users voluntarily opt in. Because the vast majority of customers want to protect their privacy, data sharing is often denied. This raises the cost and lowers the effectiveness of Facebook and Instagram advertising.

Credit: FLOW E-commerce

eCommerce Globalization to Avoid Growth Bottlenecks

The total addressable market (TAM) is a common constraint for eCommerce growth and expansion. As companies hit their local and domestic consumer limitations, eCommerce brands will soon venture into the global arena to expand their reach. Not only will this help eCommerce reach more consumers, but it will assist shoppers in finding new and foreign brands. According to a recent poll, 76% of online shoppers have made purchases from an eCommerce site outside their own country, solidifying the future global expansion of eCommerce.

Localizing Supply Chain to Reduce Manufacturing Costs

eCommerce is seeking more cost-effective solutions as supply chain delays and interruptions persist far beyond 2020. With raw material shortages and rising air and sea freight costs, business owners are moving to a more localized supply chain. Companies are shifting from low-cost production in China and toward higher-priced manufacturing and distribution in the United States. Businesses are choosing a local distribution facility to avoid record-high freight costs, delayed inventory, and delayed shipments. Although localizing your production may cost more upfront, your customers will receive orders faster, inventory will remain stocked, and transportation and distribution expenses will be reduced, possibly saving you hundreds in the long run.

 

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Partnering with a 3PL

Prior to 2020, 3PLs were leveraged by most fortune 500 companies around the world. Now, post-pandemic, not only do 90% of fortune 500 still works with 3PL partners, but small to mid-size eCommerce businesses are making the switch as well. This is due to increased awareness of the enhanced efficiency and reduced fulfillment costs that 3PLs can provide. Working with a 3PL allows eCommerce businesses to better optimize fulfillment, scale flexibly, minimize inventory shortages or delays, adopt the best shipping rates, and even provide sustainable solutions and alternatives to reduce a company's carbon footprint.

Learn more about partnering with a 3PL

Renewed Focus on eCommerce Sustainability

Consumers and businesses alike are becoming more environmentally conscientious. This has ushered in new trends of sustainability, ethically sourced products, and morally sound business models. Shoppers are are choosing more sustainable options over cheaper or faster alternatives. Because of this, eCommerce are quickly making the switch toward sustainable packaging, waste minimization, renewable energy, and a more people-focused business strategy.

Learn more about eCommerce sustainability

Alternative Payment Options

In the wake of high inflation, consumers are adjusting spending habits and shifting towards more frugal budgets. They are sacrificing non-essential items and services, leaving some eCommerce wondering what to do. Thankfully, the buy-now-pay-later (BNPL) options that appeared in 2020, are quickly growing in popularity. Afterpay, Sezzle, and Affirm are examples of popular BNPL options that are slowly taking preference for many shoppers. Whether BNPL options are used to work with inflation, offer financial flexibility, or something else entirely - any eCommerce will benefit from introducing BNPL options at checkout.

Final Thoughts

At the end of each quarter, there are bound to be new trends for your eCommerce to capitalize on. From eCommerce globalization and localized manufacturing to 3PL partners and higher competition, it’s tough out there. Make sure to follow along with Falcon to get up to speed on the latest consumer and eCommerce trends.

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4 Ways Right-Size Packaging Can Boost Profitability

Selecting the right-size packaging for your eCommerce product(s) not only showcases your brand but also boosts profitability. There are several costly outcomes of poor package sizing. First, you are likely paying more for shipping. Secondly, is the excess cost of packaging materials. Lastly, you are more likely to experience returns and refunds due to damaged products. Today, let’s examine four ways that right-size packaging can boost profitability.  

Boosting Profitability with Right Size Packaging

Reduce Packaging Spend

If you are using standardized sizes for your products, you will likely be filling the “extra air” with space-filler. Select right-size packaging depending on the weight, fragility, and value of the product. For example, swapping out expensive cardboard boxes for poly-mailers will save space and money. It goes without saying, that the smaller the package, the less filler you will need, and the less money you spend overall. Here are a few other ideas from Ribble about utilizing right-size packaging.

Boosting Profitability with Right Size Packaging

Reduced Shipping and Storage costs  

Utilizing right-size packaging helps to optimize pallet loads, which in turn, helps save $$$ on transportation, handling, and storage costs. The more product you are able to pack into the truck the less per product you pay for the trip. When considering just how much you can save by selecting smaller packaging, you must verify how you are being charged for shipping. Most transportation companies calculate based on dimensional weight as well as physical weight. Calculate how much you could reduce your shipping and storage costs by eliminating a few inches per product. 

Boosting Profitability with Right Size Packaging

Reduced Returns and Damaged Product Replacements

Less space around the product means less movement within the box. If you have shipped or received anything in the past few months, you are aware of how packages are treated. Packages show up with dings, rips, and crushed corners. However, the impact of normal shipping jostling is significantly reduced when the package is right-sized. The more consistently your products arrive in working order, the higher your customer satisfaction will be.   

Boosting Profitability with Right Size Packaging

Make a Commitment to Sustainability 

Another profit-boosting benefit of using right-size packaging is the ability to share that you are working toward sustainability. Even if you don’t swap out plastic bubble wrap for green cell foam, you will definitely be using fewer materials and less fuel. According to Deloitte research, ⅓ of consumers value ethical practices in the products and services they buy. Ensure that you are able to attract more buyers with your commitment to sustainability with a simple change to right-size packaging. You can even go a step further by creating a memorable unboxing experience. Falcon Fulfillment can offer expert advice on personalization, sustainability, and maximizing right-size packaging for your brand. 

Switching from standard-size boxes to right-size packaging will boost your bottom line. 

If you are interested in learning more about right-size packaging and how your 3PL can help you scale, get in touch with one of our agents today. Falcon Fulfillment are experts at packaging, sustainability, and scaling your business. 

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Help Your eCommerce Save Money with a 3PL

Help Your eCommerce Save Money with a 3PL

Wanting to own your own time is a common reason why people decide to launch their own businesses. They want to be the master of their own schedule. However, many business owners quickly realize that when you launch an eCommerce it can eventually begin to own you. Two of the largest and most critical elements of any eCommerce are shipping and fulfillment. Doing it yourself in-house can save you some money in the short term but it could hinder your growth in the long run. Let’s walk through a few ways your eCommerce can save money with a 3PL. 

90% of the Fortune 500 companies use a 3PL for fulfillment.

Help Your eCommerce Save Money with a 3PL

Warehousing

Whether you rent or own warehousing facilities, you will need to stage, store, and ship goods. If you own your warehouse, do you have space to expand when necessary or beneficial? If you rent warehouse space, do you have flexible options to meet fluctuating demands? The accuracy of your sales projections will determine if you’re in the sweet spot of warehousing, or whether you need to look for more financially-savvy options. 

Alternatively, when you’re partnered with a 3PL, you have the flexibility and freedom to scale when you need to - and when you want to. Furthermore, a 3PL partner offers scalability options without the long-term commitments you would encounter otherwise. This cost savings and flexibility allow eCommerce to maximize sales and scale readily.

 

Help Your eCommerce Save Money with a 3PL

 Staff

Depending on the size and quantity of your products, you will likely need a few extra hands to get them to your buyers. If you are managing in-house fulfillment, you are 100% responsible for hiring, quality control, management, and down-sizing when necessary. If you have an employee walkout mid-shift, guess who is still on the hook to get orders out the door? Yep, it’s you. With a 3PL partner, you are free to run as many product promotions, launches, and sales collaborations as you can, without the risks of personal staff or process delays. A 3PL manages all the personnel required to scale up or down as your eCommerce needs change.

 

Help Your eCommerce Save Money with a 3PL

Packaging

No matter what you are shipping, it must be packaged. As a solopreneur, you will likely run into MOQ (minimum order quantities) on packaging materials. This includes; boxes, filler, bags, and more. Depending on the upfront investment cost, it could limit the number of products you are able to deliver in one shipment. If you sell more than one type of product, it further complicates your packaging spend. With a 3PL partner, you are afforded much higher flexibility in packaging services due to the high volume of products purchased and strategic packaging vendor relationships leveraged by most 3PL’s. In addition, depending on the 3PL partner, they can offer personalized packaging which elevates your brand awareness and visibility.

 

Help Your eCommerce Save Money with a 3PL

Shipping

The least expensive way to ship most products is to do it yourself. You pick it, pack it, wrap it, drive it to the shipping location, and update the customer with the delivery details. Then you monitor tracking to ensure it makes it to the customer. Even though a 3PL partner will not necessarily lower your shipping costs, it will alleviate the cost of time. You no longer will be working IN the business but ON it. A quality 3PL will not only get your product shipped in a timely manner, they will also have an inventory management system that will inform you and the customer of the delivery status.

 

Help Your eCommerce Save Money with a 3PL

Returns

Every eCommerce will have to manage returns and the average percentage for eCommerce hovers between 20-30%. This isn’t a big deal if you are processing 5 orders or less per day. However, just beyond this threshold is a tsunami of returns that threatens to slow down the processing of future orders. Working with a 3PL gives you the peace of mind that returns will be received, reshelved, and reshipped when an exchange is desired. Furthermore, 3PL’s that have invested in high-tech IMS will be able to keep more accurate quantities so that you don’t miss out on sales of products that simply haven’t been added back as available inventory. 

Partnering with a 3PL will save you money by giving your company the flexibility in warehousing, staffing, and packaging. It will save you time, hassle, and headaches by alleviating shipping burdens, inventory management, and dealing with returns. While the immediate costs may appear to be higher, a good 3PL partner will help lay the foundation for the next stage of your eCommerce growth and save you money in the long run. 

If you want to own your time again, get in touch with one of our agents. See how Falcon Fulfillment can help you regain life’s most precious commodity.

 


Inflation of eCommerce

Inflation and eCommerce

What is eCommerce Inflation?

Despite the fact that inflation has not been significant for eCommerce throughout its history, everything changed at the start of the pandemic in 2020.  Since then, inflation, shortages, and supplies have only become worse, impacting most eCommerce businesses around the world.

Inflation of eCommerce

Credit: Adobe Digital Index

 

According to the July 2021 Report by Adobe Digital Economy Index, online prices have increased 3.1% YoY.

“In January and February 2022, these higher costs drove $3.8 billion in online sales growth.  That same rate of inflation could lead consumers to spend nearly $27 billion more in 2022 on the same amount of purchases.”

- Retail Dive

To some degree, the rate of eCommerce inflation has matched the general rate of economic inflation, which was recorded at 8.5% in April 2022.

“Consumers and eCommerce alike should anticipate inflation to linger around 4-5% over the next three years.” 

- Bloomberg

Inflation of eCommerce

How is Inflation Affecting eCommerce?

While eCommerce is experiencing an all-time high in sales growth, inflation is not linear. It ripples through the economy in various ways, affecting nearly every eCommerce differently. Inflation's impact on small to medium-sized businesses may seem negligible now, but it can quickly add up with ongoing obstacles in the supply chain.   

When manufacturers are unable to retrieve the raw materials required to produce products, they suffer. Additionally, inflation increases the price of other commodities such as electricity, internet, online advertising, and computer upkeep. From reduced inventory and missing items to increased costs and longer delays, inflation is affecting businesses around the world.

Raising prices makes sense for most businesses combatting the effects of inflation.  However, charging more could cause additional chain reactions. Because inflation reduces the number of products consumers can afford, we predict a heavy impact on eCommerce, especially those selling non-essential or luxury items. When consumers restrict their spending habits, businesses naturally lose profitability.

Covid and the Supply Chain

The increased demand for products rather than services reflects the significant shift in consumer behavior since the pandemic. This unanticipated demand, combined with the effects of Covid-19, had a significant impact on the already stressed supply chain.

“The shipping delays and port bottlenecks of late 2021 left businesses with insufficient supply. At the same time, Americans unleashed pent-up demand throughout last year and pushed spending above the pre-pandemic trend.”

-Business Insider

What Can eCommerce Do?

Although the supply chain is slowly recovering, what can you do to combat growing prices, reduced inventory, and future shortages?

Update Product Offering

Is your product model reflecting the current market inflation? If it doesn't, try to eliminate underperforming SKUs, introduce private label brands, and combine items to boost the value or lower product amounts. For example, instead of a 10-ounce portion, provide an 8-ounce.

Increase Productivity

Increasing productivity may be an alternative to raising prices.   Some examples of how to increase productivity are; the use of automation, marketing optimization, recruiting personnel, or utilizing a third-party fulfillment service to find you the best avenues to navigate inflation and fulfillment.

Keep a Safety Stock

Extended lead times, increased prices, and the unpredictability of the supply chain, has made maintaining healthy inventory levels more important than ever. If your position allows, we recommend keeping up to six months' worth of safety stock on hand.  This may help eCommerce capitalize on additional market share during future times of inflation, delays, or shortages.  For businesses that are forced to overlook this strategy, partnering with a 3PL could be the answer to reliable safety stock and affordable warehousing.

Switch Suppliers

Working with a manufacturer that can build and ship your items locally can save on high sea freight shipping costs. Most sellers find the efficiency and cost of manufacturing in China to be appealing; however, spending more on local production may prove to be a justifiable tradeoff when avoiding high and continuously climbing sea freight costs.  Transitioning to a domestic supplier allows you to minimize supply chain complications and provide home-grown products to consumers.

Final Thoughts

Despite best efforts, eCommerce companies may still have to raise prices due to inflation. However, leveraging these tips could help your eCommerce business keep costs lower, which will maximize your competitive advantage.

Follow along for more as we navigate the fulfillment world and bring you insider news on the supply chain, eCommerce inflation, and more.


1PL, 2PL, 3PL, 4PL, 5PL: Logistics Providers Explained

The majority of business owners have heard the phrase "3PL" or other "PL" terminology. What most people don't realize is that there are many tiers of logistics providers, and their services vary based on the needs of your company.

In this article, you will learn the distinctions between logistics providers to help you determine which type is best for your company.

1PL - First-Party Logistics

A First-Party Logistic Provider is made up of two parties, the supplier and the retailer/customer. A 1PL logistics provider transports items from stock to shelves. In this type of relationship, the supplier manages their own inventory, storage, and delivery.

2PL - Second-Party Logistics

Second-Party Logistics Providers focus solely on the transportation sector of business.  Examples of 2PLs include airlines, shipping lines, and hauling companies that operate the vehicles.  2PLs transport inventory between one or more legs of the fulfillment journey.

3PL - Third-Party Logistics

Third-Party Logistics is an industry term most are familiar with. For companies looking to outsource their entire logistics process, 3PLs are the answer.  They are able to handle the management of receiving, inventory warehousing, packaging, and shipping services, letting eCommerce businesses focus on other important areas of their company.  Some 3PL businesses offer additional logistics services known as value-added services.  These include inventory management, kitting and assembly, and more.

According to Armstrong and Associates, 90% of Fortune 500 companies use a 3PL.

4PL - Fourth-Party Logistics

Fourth-Party Logistic Providers act as consultants.  While their services are similar to a 3PL, they lack the physical means to move inventory through the supply chain themselves.  Instead, a 4PL will contact and negotiate services between the necessary companies on your behalf.

Read 3PL vs. 4PL

5PL - Fifth-Party Logistics

A Fifth-Party Logistics Provider is a consultant one step above a 4PL.  5PLs act as aggregators for 3PLs by bundling the needs of multiple 3PL businesses to get better rates on services. Working with a 5PL involves a fully integrated logistics solution to encompass the entire supply chain from beginning to end through multiple outsourced logistics providers.

The Sweet Spot

Similar to the story of Goldilocks and the Three Bears, supply chain providers are their own metaphorical bowls of porridge.  Some are too cold, simple, and bland.  Others are too hot, complex, and hard to understand.  However, there is one porridge that comes at just the right temperature, provides just the right amount of support, and allows your eCommerce to successfully grow and scale.  3PLs are the sweet spot of supply chain service providers.  With full control mixed with the support you need from fulfillment experts, you’re free to focus on more important aspects of your business while your fulfillment seemingly manages itself.

The Bottom Line

A 1PL partner is the simplest system and doesn’t require excessive integration or networking. Your business has full control over the supply chain process, however, your ability to scale will be limited and the risk of supply chain obstacles will increase.

A 2PL also uses a simpler system, but it does not offer as many logistics solutions as other supply chain providers.

Once your company is in a position to consider 3PL services, it’s time to transfer some aspects of your business over to the experts.  These aspects are various parts of the fulfillment process that take the most time and precision, including but not limited to warehouse storage, inventory management, order processing, and order assembly.  While these aspects are outsourced, your business still retains control and final say.

If you’re interested in outsourcing your entire supply chain process, a 4PL or 5PL are great options depending on the needs of your company. However, businesses that outsource with a 4PL or 5PL tend to have less control over their supply chain and final-say decisions. 

If you’re looking for a 3PL, we own and operate dual warehousing facilities in Utah and Kentucky. Our multisite infrastructure allows us to distribute inventory nationwide with reduced transit times and shipping costs. Talk to one of our agents today!

 

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Working with Falcon Fulfillment

The Goal: A 3PL That Goes Beyond a Partnership

If you’re browsing through third-party logistic companies, chances are, you’re looking for a fulfillment partner. A typical 3PL partnership consists of a third party handling the order fulfillment sector of your business.  With most popular 3PL companies - that's all you ever get.

While we still deliver quality fulfillment services, the focus of Falcon is a partnership that goes beyond the normal expectations of a fulfillment partner.

We’re interested in the success of your company - even when it’s not with us.  

We understand that your business needs experts in multiple fields, not just logistics.  That’s why our partners have exclusive access to our personal network of experts, in various sectors of eCommerce including manufacturing, operations, marketing, IT, and more.

If we don’t specialize in it, we’ll connect you with someone who does.  

Alongside customized sustainable packaging, competitive accuracy rates, and dedicated account managers, our array of industry connections is one of the many reasons our clients choose to partner with us.  

When working with Falcon, our onboarding process is designed to give you personalized service tailored toward the aspects your eCommerce needs and demands. Once we establish priorities we connect to our API and begin streamlining your orders within a couple of days or weeks - never months. Switching your 3PL fulfillment partner has never been easier.

“By providing our clients more flexibility around onboarding, it allows them to easily facilitate the implementation transition with their vendors & suppliers as well as IT management & customer support teams. Additionally, providing them the ability to better manage any unexpected disruptions or delays along the way.”

- Corinne Mathieson, Senior Account Manager

When searching for the right fulfillment partner, it can be confusing, time-consuming, and even daunting. That's why we've outlined precisely what it's like to partner with us, what you can expect, and what our onboarding process consists of. With this step-by-step onboarding guide, we help eliminate confusion, second thoughts, and blind spots.

Working with Falcon

Phase One: Introduction

The introductory stage with Falcon Fulfillment consists of representatives from both companies collaborating and discussing their goals. This establishes a better understanding of what a future partnership would look like between the two.  There are a few topics that are covered during the introductory stage. The outcomes of those discussions and topics determine whether moving into phase two of the partnership would be ideal.  Falcon’s introductory topics include:

Business Information

One of the first topics of discussion is, of course, your business.  At Falcon, we are interested in your company, its values, current KPIs, and much more.  We aim to gather key information about your business that will help us better understand how we can assist and whether working with Falcon is the right fit for you.

Company Pain Points

Next, we will gradually move into the main reasons you’re looking to partner with a 3PL. We will dive into the specific pain points your company is experiencing and how you’re looking to improve.  It’s critical to be fully transparent with the needs of your company and what support you’re looking for in a partner. This insight provides Falcon with the baseline for establishing a successful strategy in your fulfillment partnership.

Future Company Goals

The final subject we cover during the introductory phase is the future goals of your company.  Defining where you’d like to see your eCommerce in the foreseeable future and what tools you need to get there is extremely important when working with any 3PL partner.  Discussing the goals of your company will help us better understand how to be the partner your eCommerce needs to succeed.

“The process of discovery is important to us. The idea is to understand your demands so that we can add value where it's needed. A rising company's goal is scalability, and we take it into account. We can focus on your order fulfillment while you focus on sales, marketing, and product development thanks to our extensive network of industry partners!”

-Gabino Chacon III, Sales Executive.

Working with Falcon

Phase Two: Get to Know Each Other

Following the introductory stage, if the partnership seems beneficial, we move on to phase two where we discuss the operational side of your business. This includes requesting sensitive data, optimizing operational procedures, answering questions, and reviewing.

Request Shipment Data

Transparency and communication are important to us at Falcon Fulfillment. We take pride in providing our customers with insider information, cost-reducing opportunities, and exclusive access to our extensive network of partners.

During phase two, we ask specific questions about your products and operational data to better understand your needs as a company and how working with Falcon can benefit you. This data is needed to create a pricing model suited specifically to your eCommerce. Falcon uses 90 days' worth of operational data to properly analyze our value adds including but not limited to

Working with Falcon

Optimizing Postage and Operations

By analyzing the weights and dimensions of your current packaging, we can optimize your packaging strategy for right-size packaging. Furthermore, we help advise on the most economical and expedited shipping method to fit your current model and SLAs to your customers.

“Data is critical to understanding business, meeting customer demands, and staying ahead of the market. Understanding that data is even more important.  That’s why our team thoroughly reviews client data to meet the needs of our partners, their eCommerce, and their customers.” 

-Lori Denning, Director of Ops

Review Information

At the end of phase two, we evaluate the data and begin our review stage.  We consider whether your shipment data meets our partner criteria, whether Falcon can help with your company's pain points, in what ways we can do so, and lastly, we determine if a partnership is beneficial for both parties.

Working with Falcon

Phase Three: Bringing in the Teams

If phases one and two appear favorable for both parties we commence with the third phase. This is the point in the onboarding process where we involve the teams who are responsible for fulfillment. This is where we look at the specifics of how the partnership will function practically. The partnership has essentially begun whereby teams meet and lay the groundwork for a long-term and fruitful relationship.

Meet with IT and Operations

Your eCommerce teams will meet with Falcon’s IT and Ops teams. We then coordinate how we connect to the eCommerce shopping channel, pull orders, and ensure the end customers get exactly what they ordered in the timeframe promised.

Working with Falcon

Phase Four: Review Proposal 

At this stage, our teams will be familiarized with one another, and the framework of our partnership will begin to take shape. During phase four, company representatives will reconvene and continue finalizing the details. Final plans will include approval of a tailored pricing model, a custom proposal, and a time to begin onboarding.

Tailored Pricing and Proposal 

Fulfillment is not a one-size-fits-all solution. That's why we provide a comprehensive price and proposal plan tailored to the specific needs of your eCommerce. After reviewing the proposal, answering final questions, and making any necessary modifications, it's time to set up an official onboarding date and assign your business its own personal account manager to support you every step of the way.

Working with Falcon

Phase Five: Onboarding

Meet with the Senior Account Manager

The day of onboarding will have finally arrived and a meeting will be arranged between you and the Senior Account Manager to cover all the details.  Together, you will be guided through the onboarding process while SKUs are imported, APIs are connected, and your eCommerce is connected to our Shipstream system, among other mission-critical tasks.  Your personal account manager will assign a position for your fulfillment. This is contingent on the performance and needs of your eCommerce.

“Account managers act as a direct support line for our clients.  Being continually in the loop of sales inventory enables us to reach out and rectify issues before they become problems. Our close relationship with warehouse personnel enables us to communicate with our clients in a timely and easy-to-understand manner.  Additionally, we have access to shipping pricing tables and are always looking for new delivery solutions to benefit your eCommerce.”

-Falcon Account Manager

Schedule a Start Date

After successfully integrating your selling platforms into our fulfillment software and meeting your new personal account manager, we will be ready to schedule an official start date for your eCommerce.  Once we’ve reached this step, the only thing left to do is sit back and relax while Falcon handles the rest.

Celebrate

Although not explicitly in the Falcon onboarding handbook, the current and future success of our partnership is definitely worth a party.  When working with Falcon, you gain more time for other important aspects of your business, or maybe more precious time at home with your family.  Whatever it is, take the time to celebrate your success.  You deserve it.

Conclusion

Falcon’s fulfillment process is designed to support you and help you succeed in all aspects of business - especially fulfillment. From our streamlined logistics services to our dedicated account managers and an array of networking partners, working with us will provide an advantage to your eCommerce that you will not find anywhere else.  Talk with one of our agents today and get ready to Fly with Falcon.

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Supply chain metrics

4 Supply Chain Metrics for eCommerce Fulfillment

The Importance of Supply Chain Metrics

An efficient and streamlined supply chain is a key component of a successful eCommerce company.  You can minimize delays and backorders in your fulfillment process and generate satisfied consumers by evaluating KPIs such as dock-to-stock durations, shipping timeframes, and order accuracy rates. Measuring supply chain key performance indicators gives you the data you need to solve problems and continuously improve supply chain efficiency.

4 Supply Chain Metrics for eCommerce Fulfillment

To compile our list of essential supply chain metrics, we examined WERC’s Report on Industry Metrics and spoke with our fulfillment experts to come up with four essential supply chain metrics that any successful eCommerce will have in its fulfillment process.1

Supply chain metrics

Dock-to-Stock Cycle Time

Dock-to-stock cycle time is the amount of time it takes (normally measured in hours) to transfer inventory from docks to warehouse shelves, making it available for picking.  The cycle starts when the items arrive from the manufacturer and ends when they are stored and recorded in the inventory management system (IMS)

At Falcon Fulfillment, we pride ourselves on a swift dock-to-stock cycle time.  We guarantee inventory will be unloaded and available for picking within 48 hours of arrival.

 

Supply chain metrics

Inventory Accuracy

Inventory accuracy is defined as the physical accuracy compared to the information reported into the inventory management system. It’s recommended that your 3PL do two to four-cycle counts and one physical inventory per year to monitor this supply chain KPI. A cycle count measures each unit and its SKUs to compare the data entered into your warehouse facility's IMS upon receiving with what is physically available.

Throughout 2021, we delivered on order accuracy with a peak performance of 99.93%.

Supply chain metrics

Order-picking Accuracy

A term used to define the accuracy of product selection during the order fulfillment stage of a sale. This metric consists of a trained picker collecting precise merchandise from warehouse inventory to complete a customer order.  Once all items are gathered, they are packaged and shipped to customers. Picking accuracy greatly influences order accuracy, therefore the industry standard is no less than 99.30%.

The pickers at Falcon avoid errors from the get-go.  With a specialized barcode inventory management system, warehouse staff is able to accurately pick orders with a 99.999% accuracy.  

Supply chain metrics

On-time Delivery

On-time delivery is a term used to describe the rate at which an order was successfully delivered in accordance with the customer's preferences at the time of purchase. If a shopper chose 2-day shipping, did their package arrive within those 2-day specifications?  Maintaining customer satisfaction and fulfilling consumer expectations requires a robust on-time delivery rate. To sustain customer satisfaction and rising supply chain metrics, it's suggested that eCommerce achieve an on-time delivery rate of at least 95.20% or higher.

Supply chain metrics

Falcon Improves Supply Chain KPIs

Exceptional supply chain KPIs are reliant on strong eCommerce fulfillment performance. Partnering with a 3PL partner that prioritizes quality and efficiency is crucial for the long-term success of your business.

Falcon Fulfillment provides eCommerce companies with the support they need to scale and reach industry performance standards. We strive to provide stress-free logistic services that are backed by fulfillment experts and proactive staff.

Conclusion

Meeting supply chain metrics is critical for your eCommerce.  With a streamlined fulfillment process consisting of high inventory and picking accuracy, on-time order delivery, and reasonable dock-to-stock time, your business can successfully meet customer expectations and industry standards. Let Falcon help you exceed your current supply chain metrics. Talk to an agent today.

 

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  1.  2018 WERC DC Annual Survey and Report on Industry Metrics

Beer subscription benefits

The Top 4 Benefits of a Beer Subscription Service

Currently, the average consumer has 5 subscription services, with 51% saying they intend to add more.  Jump on the opportunity to expand your brewery with these beer subscription benefits.  By utilizing a subscription service for your brewery, you appeal to convenience expectations, overcome geographic limitations, improve inventory management, and stay competitive with other brewers.  Learn how Falcon can benefit your brewery today!

The Top 4 Benefits of a Beer Subscription Service

Appeal to Customers with Convenience

Subscription-based business models have gradually taken over in recent years. Consumers in 2022 value speed, convenience, and sustainability. By introducing a subscription service to your brewery patrons, you make it easier for customers to explore similar products and try new brews!

78% of consumers say they value convenience more today than they did before the pandemic.

The brewers at Beer Drop know how to deliver on the promise of convenience. The simplicity of a subscription model allows shoppers to choose their favorite craft styles (or those they're interested in trying), click the buy button, and then sit back and wait for their ice-cold suds to arrive. 

beer subscription services
Photo credit: Beer Drop

Falcon makes convenience possible for consumers and brewers alike.  With forward-staging locations inside our temperature-controlled warehouse, brew subscriptions come in from suppliers and go out with delivery carriers in a matter of hours or days.  With our streamlined and systematic approach, customers receive their products quickly, and breweries increase their loyal fan base.

Overcome Geographic Limitations

The customer base of traditional breweries is often limited to towns, state lines, and word of mouth.  With a brewery subscription service or a beer of the month club, you unlock access to thousands of brew fans online that wouldn’t otherwise have discovered your brand.

Brewvana uses widespread appeal to market to consumers by offering a Brew's Less Traveled membership package. Each month, buyers can sample a state-themed beer collection from a variety of brewers within that particular state. Brewvana can advertise to and reach fans all around the country using this approach (excluded some states).

Beer subscription benefits
Photo credit: Brewvana

With Falcon’s strategically located warehouse, reaching consumers near and far is easier than it ever has been. 

Improved Inventory Management

Managing inventory for ongoing subscriptions is predictable. Members typically commit to automated, recurring orders, especially if they enjoy what gets sent to them. With subscription services, breweries can better anticipate future profit and customer demand for improved inventory management and sales predictions.

Falcon’s transparent cloud-based inventory reporting allows partners to access fulfillment details, stock movement updates, and a real-time inventory snapshot every day.  This allows you to have complete transparency over your inventory and gives you the details you need to improve and streamline your inventory management.

Stay Competitive

As most companies gradually shift online, so do breweries.  This means establishing an online presence and providing customers with automation and convenience is more important than ever.  By creating a unique subscription-based platform, your brewery has an exceptional chance at dominating the online brew market.

The Rare Beer Club is a great example of offering a unique subscription box to shoppers.  Each month fans can choose from different subscription boxes ranging from beer, wine, cheese, chocolates, flowers, and even cigars.  Their most notable aspect is their “design your own club” campaign.  With this option, consumers can curate a personalized subscription box including rare beers, accenting cheese and chocolates, and even a cigar of their choice to top the experience off.

Conclusion

By introducing a subscription model to your brewery, you tap into new benefits for your company and your customers.  From appealing to convenience expectations and overcoming geographic limitations, to improving inventory management and competitiveness, Falcon can help your brewery launch a successful subscription service today.

 

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