Jamie C. Winters, Author at Falcon Fulfillment

3PL vs 4PL, What Are They?

3PL vs 4PL, what are they? How do they differ? What can e-commerce 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 e-commerce 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 e-commerce 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 e-commerce. 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 e-commerce 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 e-commerce. Depending on your order volume, a 3PL partner can scale operations and inventory space up or down to provide everything your e-commerce needs, and nothing of what you don’t. This is essential for seasonal e-commerce 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 e-commerce faces stiff prices named by private shipping companies and little to no cost advantage over competing e-commerce.

Control

A 3PL partner offers a balance between management and personal control over your e-commerce. 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 e-commerce 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 e-commerce 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 e-commerce and their supply chains. When you have a single point of contact handling your entire logistics process, you can sit back and truly observe the backend of your business seemingly running 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 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

4PL partners use data solutions to track fulfillment and monitor conformance to standardized regulations, ensuring efficiency in on-the-road operations through 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 e-commerce 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 e-commerce businesses.

Beginner’s Guide to Third-Party Logistics (3PL)

The world of e-commerce is always changing, therefore understanding the roll of Third-Party Logistics is integral to keeping up. In light of this our beginner’s guide to third-party logistics (3PL) will delve into the essential aspects, offering insights into fulfillment services, warehousing, and much more.

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.

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by Jamie C. Winters

The Pros and Cons of Dropshipping for E-commerce

What is Dropshipping?

Dropshipping involves an e-commerce fulfillment method where online retailers source products from third-party suppliers upon customer orders. This model effectively delegates inventory management, shipping, and fulfillment responsibilities to external vendors, alleviating merchants from these operational tasks. When orders are received, dropshipping suppliers take charge of product manufacturing and shipping, acting on behalf of the seller. However, it’s important to weigh the pros and cons of dropshipping.

What is a Dropshipper?

A dropshipper, typically a manufacturer or supplier, assumes responsibility for overseeing a retail merchant’s inventory and order distribution. Given that most business operations are overseen by the dropshipper, the primary duties of the merchant include brand marketing, customer attraction, and pricing strategies aimed at ensuring a healthy profit margin.

How Does Dropshipping Work?

Dropshipping is relatively simple and consists of two steps.

In dropshipping, an e-commerce model, inventory, warehousing, packaging, and shipping tasks are managed by a third-party on behalf of the seller.
When a shopper places an order, the order is relayed back to a seller’s dropshipper. Subsequently, the seller will purchase the product(s) in the order, and the dropshipper will proceed to manufacture/create the order, package it, and ship it directly to the customer.

LEARN HOW DROPSHIPPING COMPARES TO A 3PL

The Advantages of Dropshipping

It’s likely that start-ups and first-time business owners are interested in the dropshipping business model because of the seemingly off-the-bat benefits. Let’s take a closer look at the pros and cons of dropshipping.

No In-house Inventory

Managing your own inventory is stressful. Fulfilling orders, managing returns, and overseeing customer service consume a lot of time and focus. With a dropshipping business model, the inventory of a seller is directly managed by the dropshipper’s warehousing facility, along with order returns and basic packaging needs. This reduces overall costs by eliminating personal fulfillment expenses, the need for employees, and the need for inventory space.

Little Start-up Costs

A significant advantage of start-up e-commerce is that dropshipping facilitates minimal initial investment. Essentially, you only need to select your products, integrate them into your store, and pay when a product is purchased. Consequently, without the burden of fulfillment processes or inventory management, start-up expenses are minimal, enabling a swift launch of your business.

No Fulfillment Responsibilities

Compared to other e-commerce, sellers who are using a dropshipping business model do not have to worry about other areas of fulfillment. With no inventory or packaging to manage, sellers can focus on creating products and advertising them to the right audience while their dropshipper does most of the work. This appeals to first-time sellers, new entrepreneurs, and those wanting to sell with minimal responsibility.

The Disadvantages of Dropshipping

While there are many benefits to dropshipping, it has its equal share of disadvantages. Let’s consider a few examples and how they compare to the upside of dropshipping.

Loss of Control

One of the disadvantages of dropshipping is the seller’s lack of control. Since brands do not have to manage their own inventory, fulfillment, and order shipping, they lack the means to customize the customer’s shopping experience. This often results in generic packaging, average or extended delivery times, and possible quality control issues.

Quality Control

Without control, there’s a potential drop in quality. Furthermore, if sellers are unaware of their dropshipper’s product quality, they may face customer complaints they weren’t expecting. Moreover, sellers lack the ability to inspect inventory prior to sale, potentially leading to damaged items, packaging issues, and customer dissatisfaction.

Branded Shopping Experience

Yet another downside of loss of control over certain areas of your business, is missing out on providing a branded shopping experience to your customers. Although some dropshippers allow for some package customization, there are few options when compared to fulfilling on your own or with a 3PL. Restricting branding narrows the perception your customers hold of your company. Without a distinct brand identity, how will you differentiate yourself from the multitude of Amazon sellers?

Beginner’s Guide to Third-Party Logistics (3PL)

If you’ve surpassed the limitations of your dropshipping model, seek to expand your operations, or wish to explore the benefits of partnering with a third-party logistics provider (3PL), reach out to one of our agents today.

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by Jamie C. Winters

The Oceanic Effects of E-commerce

We’ve talked about the environmental impact of e-commerce in other articles. We have also discussed what ways businesses can reduce their own negative impact on the earth. Today, we’ll be discussing the effect that e-commerce has on the world’s oceans and water supply.

Oceanic Pollution

Human activities on land are responsible for over 80% of oceanic pollution. While the majority of it is attributable to non-point source pollution, which is pollutants that fall into rivers and inevitably end up in oceans, river-borne litter and plastic account for a significant fraction of the pollution in our seas. Excessive packaging, tags, plastics, textiles, and microplastics from e-commerce retailers often end up in waterways and the open sea.

This debris not only pollutes our water but also grinds together to form microplastics and micropollutants that marine life consumes. When this occurs, aquatic species become vulnerable to fatality and other serious health issues. Some contaminants, such as microplastic, cannot be digested by other creatures which leads to contaminated marine food. These contaminated food sources ultimately make their way to us and other animals.

Ocean Acidification Caused by Emissions

The ocean provides one of the most significant benefits to the earth in terms of climate change. It absorbs 30-50% of all CO2 created by fossil fuels each year, keeping our environment healthier for longer. The three major sources of greenhouse gas emissions are electricity, transportation, and landfills. Together they contribute almost 36,000 billion tons of emissions per year.

This becomes problematic when roughly half of these emissions are absorbed by plankton, algae, and other marine plants through atmospheric diffusion and photosynthesis. This alters the total pH of the ocean’s surface water, accelerating acidification. The more waste we generate, the more emissions are released, the more the ocean absorbs, and the more acidic it becomes.

With the ocean acidifying quicker than it has in millions of years, species with calcium carbonate shells and skeletons are dissolving. As a result, organisms attempting to adapt to increasing acidity levels have a very narrow window of opportunity. Adaptation in such a short period of time causes slower reproduction as well as fewer and smaller offspring. Causing significant disruption across the ocean’s food chain.

Ocean Noise

Sound travels faster and farther under the ocean’s surface than land or in the sky. Many marine species rely on sound for communication, navigation, and other survival purposes. With an ever-increasing number of shipping containers transporting the world’s e-commerce goods from shore to shore, the ocean has become a cacophony of sound, interfering with marine life’s habitats and welfare. The incessant noise created by cargo containers, boats, ships, and other sea-bearing machines generates an auditory “smog” that reverberates throughout the ocean. This has a knock-on effect of limiting marine life’s sensory range. This has been related to a large number of whale strandings, aquatic species abandoning their habitats, and the death of various invertebrates such as scallops, crabs, and squid.

Beginner’s Guide to Third-Party Logistics (3PL)

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by Jamie C. Winters

2PL vs 3PL - Which Fulfillment Partner is Best?

3PL vs 2PL – Which Fulfillment Partner is Best?

If you are a growing e-commerce business that has been handling your fulfillment needs in-house, you may be considering how to scale effectively. Understanding your requirements, time constraints, and growth trajectory is crucial in deciding whether a 2PL or a 3PL is more suitable for your business. The ideal fulfillment partner will align with the needs of your business and your customers. In this article, we will define and outline the advantages and disadvantages of using a 2PL versus a 3PL partner. Ultimately, which fulfillment partner is optimal for your e-commerce venture?

What is a 2PL

2PLs, known as second-party logistics providers, are asset-based carriers responsible for transportation methods. This category encompasses shipping lines, air freight providers, and van lines, among others. Essentially, 2PLs own the transportation assets responsible for product delivery. In other words, they include airlines, sea-faring cargo ships, and rail transport companies contracted for delivery services. Often referred to as “forwarders,” they primarily control one leg of the transportation journey. The extent of their involvement in the delivery process varies depending on the company and its resources. For instance, larger shipping lines like Maersk mainly handle large, heavy, or wholesale deliveries. On the other hand, global 2PLs like FedEx can manage larger shipments and everything in between.

Pros

They provide lower overhead than shipping the product(s) yourself.
They offer simple contracts
It is easy to track goods
You have the freedom to choose the mode of transportation

Cons

Provides a basic level of delivery
Harder to scale
Relationship is transactional
Is not invested in your e-commerce success

What is a 3PL

3PLs, or third-party logistics providers, are organizations specializing in integrated fulfillment. E-commerce businesses often opt to outsource their supply chain and order fulfillment through these entities. 3PLs offer a range of services, including warehousing, receiving, storage, and shipping. Additionally, some 3PL companies offer value-added services such as inventory management, kitting, assembly, and custom packaging options. E-commerce as an industry and been growing steadily over the past decade and so has the rise in 3PLs. In fact, most fortune 500 (86%) and 100 (96%) companies use a 3PL fulfillment partner. Here are a few reasons why.

Pros:

They help simplify the fulfillment process
Faster delivery, fewer mistakes
Greater scalability
Relatively low capital investment required
Save money and time in the long run

Cons:

You give up more control of the supply chain and fulfillment process
Businesses can become dependent on their 3PL partners
Higher upfront costs initially

Opting for a 3PL over a 2PL offers several distinct advantages for growing e-commerce businesses. With a 3PL, businesses can simplify their fulfillment process and enjoy faster delivery with fewer mistakes. The scalability provided by 3PLs is crucial for accommodating business growth efficiently, while the relatively low capital investment required makes it a cost-effective solution in the long run. Despite some drawbacks such as giving up control of the supply chain and facing higher upfront costs initially, the benefits of using a 3PL, including time and money savings, often outweigh these concerns. Moreover, the widespread adoption of 3PLs by both Fortune 500 and Fortune 100 companies underscores their effectiveness in meeting the evolving needs of modern e-commerce ventures.

Beginner’s Guide to Third-Party Logistics (3PL)

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by Jamie C. Winters

How Inflation is Impacting E-commerce

Inflation is on the rise, and e-commerce businesses are feeling the uncertainty. According to Pew Research, inflation is 8.6%, the highest since 1981. American consumers haven’t seen this kind of inflation increase in four decades. With the fed raising interest rates, capital investments and consumer spending are drying up. This unsteady economic climate is causing more panic than preparation. The main contributors to the inflationary period are continued supply chain issues, the Russian/Ukrainian crisis, and new COVID-19 lockdowns in China. Knowing how inflation impacts e-commerce can help determine strategies to maintain profits and minimize spending.

Russian/Ukrainian Conflict

When Russia invaded Ukraine on February 24, 2022, inflation was already up 7.5%. However, a few critical events pushed that number higher and directly affected gas prices. Russia is one of the world’s largest producers of gas and oil. Therefore the conflict alone would have had a direct impact on fuel. President Biden banned imports of Russian oil shortly after the invasion, which increased fuel costs for American consumers. The knock-on effect of high-fuel costs is evident not just at the pump, but we are starting to see it directly impacting e-commerce.

Amazon added a 5% fuel inflation charge for its fulfillment clients in April of 2022. Subsequently, every consumer good that Amazon fulfills has a 5% upcharge based on the sustained high-fuel costs. There doesn’t appear to be relief either. E-commerce business owners will likely have to absorb the increased fuel surcharges or pass them along to consumers.

Supply Chain Pains

Thanks to the COVID-19 pandemic, we experienced a massive increase in demand for online goods. The rise in demand aligned perfectly with a supply chain bottleneck caused by a lack of laborers in the transportation and fulfillment network. Truck driver shortages are at an all-time high. The shortages have remained even with an increase in wages in America and Europe.

This labor shortage is also being seen in the ports and other transportation-focused industries. Goods are being held for longer because there aren’t people to move them to their final destination. Recent relief in the bottleneck is primarily attributed to lower demand. However, industries like household goods, food, and vehicle-related products are still experiencing high demand and slow fulfillment. The supply chain is recovering but at a snail’s pace.

COVID-19 Lockdowns in China

Chinese imports account for 18.6% of the overall imported goods consumed in the United States. The impact of recent lockdowns and stay-at-home orders sweeping across the Shanghai region of China will have a negative effect on inflation. The shipping container backlog will continue, and the pressure to get goods and component parts out of China.

Inflation is impacting e-commerce. What to do?

Clearly, inflation is harming e-commerce. With a very dismal forecast for inflationary change, what can be done? The first thing is to save more capital investment. While you can still generate capital investment, do it. As the FED threatens to raise rates, it is critical to have as much revenue in savings as possible. This gives your e-commerce flexibility in an uncertain market.

The second is to stockpile goods. Inflation is projected to continue rising, so the more raw materials and goods you can stock and store, the better your position will be in the near future. Lastly, Be prepared for continued changes in the inflationary climate.

Beginner’s Guide to Third-Party Logistics (3PL)

Regardless of how your business addresses high inflation, Falcon Fulfillment can help streamline your fulfillment process and ensure your company is best positioned to endure this economic storm. Reach out to an agent today.

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by Jamie C. Winters

Expanding Your Network with a 3PL

3PL partners offer logistics services and supply chain management. They are logistics experts, specifically; warehousing, picking and packing, inventory management, transportation, fulfillment, packaging, and returns management. Because of the focused nature of a 3PL, they typically have a broad network of partners related to all aspects of the logistics industry. How can you expand your network with a 3PL?

Transportation Network

3PLs boast relationships with multiple carriers spanning the transportation industry. These partnerships extend to various van lines, shipping companies, freight carriers, and rail lines. While an individual e-commerce business might maintain personal connections with one or two carriers, a 3PL cultivates relationships with numerous providers. The significance for your business lies in the immediate access to this expansive transportation network. This accessibility proves invaluable in scenarios such as unexpected disruptions, like flooding in Missouri, which may impede travel through vital interchanges. In such instances, your 3PL can swiftly pivot to alternative providers and routes, ensuring minimal delays.

Legal

A viable rats nest of legal concerns surround logistics, especially when you involve international shipments. This includes complicated issues like documentation, import and export regulations, as well as economic regulations. Hiring or investigating the nuances of international logistic law is time-consuming and expensive. One of the most cost-effective ways to expand your legal network is through partnering with a 3PL. A 3PL already has the expertise and relationships to comply with local, federal, and international laws. Your 3PL will have a pulse on the ever-changing legal fulfillment battles—especially those tricky wine and beer fulfillment issues.

Expand to New Locations

Expanding your e-commerce reach to new locations is daunting when you don’t have an on-the-ground expert helping you. When you consider trying to expand to new locations, you start by evaluating the market, estimating inventory needs, training staff, and sourcing suppliers and distributors. It is a very involved process. A 3PL expands your network by aiding in providing staff, multi-site distribution space, and flexible warehousing space as your reach grows. Not only that, but 3PL companies have a broad network of suppliers they work with and can make mutually beneficial introductions.

Returns Management

One of the greatest deterrents to gaining loyal customers is a lack of responsive customer service or a complex returns process. While most businesses would like to avoid returns altogether, having a solid return management process is crucial. Some of the best 3PL partnerships help manage the returns process, including receiving, returning items to the inventory management system, and disposing of damaged goods. 3PLs are experts in streamlining the returns process and ensuring a good customer experience.

Beginner’s Guide to Third-Party Logistics (3PL)

We are poised and ready to help you expand your network and business! Get in touch with one of our agents today.

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by Jamie C. Winters

6 Indicators You Should Stop Dropshipping

Dropshipping is a great way to start an e-commerce. It is a direct partnership between suppliers and manufacturers to accept orders for their goods or products. The startup costs are minimal, and it is an easy way to test products in a new market. However, there are several drawbacks to dropshipping and some significant limitations. Here are six indicators to stop dropshipping and consider fulfillment alternatives.

Product Delivery Times Don’t Meet Customer Demand

Suppliers and manufacturers are not agile in servicing and fulfilling individual orders. Their primary focus is producing and fulfilling large wholesale purchases. The bulk of their profit is made through large-scale orders. Dropshipping and any DTC sales will always be secondary. Therefore, you can expect far longer delivery timelines using dropshipping than meets consumer demand. According to Medium.com, the average dropshipping delivery time is 12-60 days.

Lower Margins

Dropshipping is essentially marketing and selling for the manufacturer. As the e-commerce owner, you can expect lower margins. Without the benefit of negotiating a larger volume order price, each sale you make will be slightly less than if you fulfilled in-house or through a 3PL. It is crucial to evaluate the entire cost of dropshipping. Even though you may save initially, it could cost you more than you think.

You Need to Scale

The e-commerce brands that thrive have a proven customer service track record. When something goes wrong with an order, the customer will call you, not the manufacturer. Therefore, you need to have the ability to problem solve quickly. This is easier if your supplier is domestic but becomes exponentially more complicated with an international provider. From language barriers to time zone differences, getting an answer could take several days vs. hours. Even if your supplier is located in the US, communications can fail. If you have experienced this frustration, it might indicate that you should stop dropshipping.

Inventory Control is Out of Control

When you dropship, you have a 0% say in how much inventory the supplier creates. Furthermore, you are stuck when a more prominent company places a larger order and buys out all YOUR stock. Your business and revenue are at the mercy of your manufacturer. At any moment, the supplier could decide to discontinue producing your product. One way to avoid this is by diversifying your manufacturing and sourcing multiple locations that can fulfill your orders. Quality control gets tricky, but you would be far less likely to have a complete inventory blackout.

Quality Control is Unknown

Unless you receive product orders regularly, you have very little assurance in what ends up in the shipped box. The unboxing experience for your customer is out of your hands. Damages and returns are more common with dropshipping, which means that your customer service teams might be busier than if you chose a fulfillment alternative.

Communication Failures

Does this sound familiar? Your sales are up, and your market test confirms there is still room for growth. However, you are concerned if you run a campaign to boost sales, fulfillment would falter. Your business is probably feeling restrained, indicating that you should stop dropshipping. When you have been accepting lower margins, but the numbers show you could maximize earnings by buying wholesale, managing inventory, and fulfilling, it might be time to switch.

Fulfillment Alternatives for Dropshippers

Check out our post on the differences in “Logistics Providers Explained: 1PL, 2PL, 3PL, 4PL, and 5PL.” There are many fulfillment alternatives, but we have found the sweet spot for e-commerce businesses seeing indicators to stop dropshipping benefit considerably from a 3PL relationship. Here’s why:

Beginner’s Guide to Third-Party Logistics (3PL)

If you are witnessing any indicators that you should stop dropshipping, chat with us to see if we can help. Get in touch today.

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by Jamie C. Winters

Improving Supply Chain Resilience with a 3PL Partner

The supply chain is often taken for granted until it is broken. The supply chain revealed some critical areas of weakness thanks to COVID-19 and the dominoes that toppled afterward. Improving supply chain resilience became an instant focus. Mike Jackson, executive director at the Original Equipment Suppliers Association (OESA), says, “Supply chain risks spiked on a number of fronts, fueled by workforce constraints, input shortages, and liquidity issues, due to the slashing of production volumes and future forecasts.” Companies scrambled with little or no notice to meet growing customer demands and plummeting supply.

During one of the biggest e-commerce booms, the businesses that thrived deployed partnerships and processes that improved supply chain performance. Delays, disruptions, and ongoing issues in the supply chain will not be dissolving anytime soon. This article will discuss why partnering with a 3PL is critical in improving supply chain resilience.

What are the supply chain risks?

Long Lead Times

The time it takes from an order placed to an order delivered to the consumer dramatically increased in 2020. According to a report by Anvyl, the top five reasons for the long lead times were:

Lack of containers
COVID-related issues (shutdowns, outbreaks, curfews, sick workforce)
Vessel space constraints
Raw material delays
Awaiting information from buyer (mostly payment delays)

Longer lead times cost many e-commerce customers. Even global conglomerate Amazon struggled to meet its “prime effect” two-day shipping. When a customer makes a purchase, they want it on their doorstep in hours or days. With the pandemic easing and the supply chain recovering, customer tolerance for delays is eroding.

Raw Material Shortages

Several ongoing factors are still contributing to a raw materials shortage, including geopolitical issues, continued zero COVID policy in China, and an upsurge in prices for raw goods. The Russian-Ukrainian crisis increased fuel costs and limited mobility of materials to major export partners. The dramatic knock-on effect left global and domestic manufacturing plants scrambling to source new suppliers. A few key industries have been hit the hardest, including; textiles, footwear, electronics, and agriculture.

Lack of Diversification

Diversification is crucial in improving supply chain resilience. From suppliers to consumer delivery routes, a diversified supply chain will increase the likelihood of success. The most pronounced areas are suppliers and manufacturing, transportation, and distribution.

Lack of Visibility

Do these phrases sound familiar, “Out of stock, back ordered, delayed shipment, delivery canceled?” The likelihood you have received this as a consumer is high. If you are an e-commerce business owner, the possibility you just had a moment of anxiety reading those is higher. Once the supply chain dominoes began to topple, the transparency of how goods were moving through the supply chain became uncertain and imprecise.

Customer service teams were overwhelmed with calls from frustrated consumers who just wanted to know WHEN or IF the product they purchased over ten days ago would arrive. Unfortunately, many businesses didn’t have a confident response. The limitations in supply chain visibility became evident. Companies that leveraged person-to-person communications and technology to illuminate issues within the supply chain could give consumers more details. Even though they may have had significant delays, they could communicate with customers proactively.

How to Improve Supply Chain Resilience with a 3PL Partner

Improving Long Lead Times

While a 3PL cannot make your manufacturer produce products any faster, they can assist with the long lead times by offering flexible warehousing. Even though lead times from international manufacturers might still be 6-8 months, the lead time from order to consumer can become significantly shorter. Having a scalable amount of storage based on fluctuating consumer demand allows e-commerce brands to pre-order products.

Improving Diversification

This is where a 3PL partnership can make the most significant improvement in supply chain resilience. Third-Party-Logistics providers are experts in transportation, manufacturers, and distribution. Where an individual e-commerce may have relationships with a few van lines or shipping suppliers, a 3PL has a vast network of connections across the transportation sector. A 3PL poised to improve your supply chain resilience will have relationships spanning air, ocean, and land. This is critical when one transportation supplier cannot deliver based on illness, staffing shortages, or border/port closures. A quick pivot can be managed by your 3PL partner, which will reduce delays.

Second to transportation is the manufacturing sector. A solid 3PL can make introductions across suppliers in order to diversify. E-commerce companies reliant on one manufacturer were at their mercy. 3PLs can help locate and work with suppliers to mitigate the risk of stockouts.

Lastly, ensuring multi-site distribution and warehousing is key in diversifying your supply chain. The best 3PL partners offer multiple warehouses where products are received, pick-and-packed, labeled, and shipped. During the worst of the slow-downs in the ports, there were certain products that were moving through West coast ports better than East coast ports and vice versa. It was highly beneficial to have a partner that could receive products from either coast. Furthermore, having a distribution warehouse near domestic manufacturers was a game-changer.

Improving Visibility

Communication failures, confusion, and limited insight from the supply chain became commonplace. However, 3PL teams are adept at reading insights and proactively determining when supplies would become critically low. Partnering with a solid 3PL allows for detailed reporting on inventory levels, forecasting, and even managing customer returns. From receiving to final delivery, a 3PL can provide almost real-time insight into your business. Premiere 3PL providers will also offer a personal approach with dedicated account managers you can contact directly. Having insight into when, where, and how your products are being managed equips your team with the information they need to appease frustrated consumers.

Beginner’s Guide to Third-Party Logistics (3PL)

Want to learn more about how Falcon Fulfillment can improve your supply chain KPIs and create a more resilient process? Talk to one of our agents today.

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by Jamie C. Winters

4 Ways a 3PL Can Help With Outsourcing Inventory Management

According to Investopedia, inventory management is the process of ordering, storing, using, and selling a company’s raw materials, components, and finished products. Inventory management requires significant resources in order to run it efficiently. Inventory is one of the most valuable components of a business; therefore, mismanaging it can be detrimental to the organization’s success. Proficient inventory management streamlines the process of reducing overages and stockouts. If your company is losing time and money due to inefficiencies or staff overload, it is probably time to outsource inventory management to a third party. There are several ways a 3PL can help with outsourcing inventory management.

Aspects of Inventory Management

Why would I outsource inventory management?

You need to improve efficiency.
You need more time to focus on core competencies.
You no longer have the warehouse space to contain adequate inventory to scale.
You need to improve margins on shipping and staffing.

Ways a 3PL Can Help With Inventory Management

Provide Flexible Storage

Many growing e-commerce businesses work out of their basements, garages, and attics when they launch. Eventually, these spaces are inadequate to ensure quick, organized, and streamlined fulfillment. If you’re fulfilling in-house, you may be experiencing these types of growing pains. Alternatively, if you’ve rented a warehouse, it might be an expensive overhead cost. The jumbled mess of packaging, bubble wrap, and returns can become someone else’s problem. Partnering with a 3PL can give you flexible warehousing space depending on fluctuations in sales and seasonal needs. You can scale your warehousing resources quickly.

Faster and Cheaper Order Fulfillment

A 3PL provides expert order fulfillment services. Your business can benefit from bulk discounts by accessing their expertise and broad national network of facilities. Partnering with a 3PL allows your business to leverage economies of scale and negotiate lower shipping and delivery charges. Additionally, your company will likely see an expedited order delivery timeframe. A 3PL fulfillment team can receive an order, package it, and get it out for delivery in a single day. Provided your 3PL has multi-site distribution, you can offer 2-day delivery almost anywhere in the US. Fast delivery times make your company more competitive in the cut-throat e-commerce landscape. Outsourcing this aspect of inventory management is a life-saver.

Advanced Inventory Management Software

Because inventory management and transparency are critical to running a successful 3PL, most use highly advanced technology. This is another cost savings because you do not have to spend money to purchase software or train staff to use it. Your business will be able to use top-of-the-line technology and receive training on how to utilize it to grow your business. The detailed reporting available includes; stock levels, automated inventory tasks, forecasting, and returns management. Here are some benefits of using an automated inventory management system, such as the one Falcon Fulfillment uses.

Reduce Inventory and Fulfillment Staff

As your business grows, you will naturally require more staff in order to fulfill orders. If you have been running a business for more than five minutes, you understand that people are a company’s most valuable and expensive asset. The more you can reduce your inventory and fulfillment staffing risk, the more you can focus on core competencies. When you partner with a 3PL, the stress of whether or not your warehouse staff will show up and get your orders out the door is eliminated. Furthermore, you do not have to bear the expense and risk of injuries from fulfillment staff. When you work with a premiere 3PL like Falcon Fulfillment, you have even greater assurance that your inventory management teams are well-cared for.

Beginner’s Guide to Third-Party Logistics (3PL)

Are you interested in learning more about how Falcon’s proprietary inventory management software could help your business? Get in touch today.

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by Jamie C. Winters

Omnichannel Fulfillment - The Falcon Difference

Omnichannel Fulfillment – The Falcon Difference

What is omnichannel fulfillment? The simple answer is that omnichannel fulfillment is a streamlined process of picking, packing, and shipping orders across multiple sales channels. The more complicated reality is that it is an integrated, collaborative network of logistics, technology platforms, and order fulfillment options that create a cohesive purchasing experience for consumers, regardless of where they bought their item. As consumers’ expectations adapt to greater freedom and flexibility in the shopping journey, e-commerce brands must also adapt. This article will share some basic information regarding omnichannel fulfillment, the benefits and challenges of implementing this strategy, and how partnering with a 3PL can help.

Benefits of Omnichannel Fulfillment

More Accurate Data

Data is only good if it is accurate. Many e-commerce companies still have multichannel sales with siloed data. Omnichannel fulfillment eliminates the data silos by creating a single point of truth concerning inventory management. All SKUs funnel into a singular platform that allows business owners to make crucial decisions on inventory, sales, and marketing efforts. Forecasting becomes clearer and targets high-performing sales channels and ones that might need revamping. Better data means better decisions.

Reach More Customers

Omnichannel fulfillment allows brands to tap into new sales channels and reach new customers. By offering multiple fulfillment options like; ship to the customer, BOPIS, curbside, brick-and-mortar, and even locker pick up, customers have more access to buying your product. When you have more fulfillment options, you have more sales opportunities.

Greater Customer Satisfaction

No matter where a consumer decides to buy your product, providing them multiple ways to purchase and a seamless brand experience increases satisfaction. Leveraging omnichannel fulfillment will get products into consumers’ hands faster than a siloed multichannel approach. The reason is that although it might take 2-3 days to ship directly from the warehouse, a local store might have stock, and a BOPIS option can be made available. Customers who need it today will love the fact they can do the driving for your brand if that means they get that last-minute gift in time!

Complications with Omnichannel Fulfillment

Integrated Inventory Management

One of the main essentials to omnichannel fulfillment success is integrating all the technology systems that track and collate sales data. For some brands, they must start all over, adding new SKUs to a single inventory management system. For others, it requires a nuanced approach where systems talk to each other in real-time. If pre-built technology integrations are available, this isn’t difficult. However, the proprietary nature of inventory systems will often require an overhaul or a top-notch developer to code the API keys. Getting all the technology systems to communicate is crucial to ensure a single SKU for each item. This can be a significant undertaking if your business has multichannel fulfillment with different SKUs.

Difficult to Manage Infrastructure and Fulfillment Strategy

Fulfilling orders from multiple channels to multiple endpoints is complex. It requires expert knowledge in logistics, warehousing, inventory management, and transportation. Flexible staffing is needed, especially during seasonal sales periods. Investments in fulfillment warehouses, equipment, and fulfillment technology will become necessary as you scale. Partnering with a 3PL is an excellent way to outsource the difficulty and expense of offering omnichannel fulfillment.

The Falcon Difference in Omnichannel Fulfillment

Automated Inventory Management

Falcon Fulfillment uses an automated inventory management system that allows your brand to have the most accurate data for your inventory. It is simple to manage high-volume requirements. We utilize advanced barcoding technology to track inventory and guarantee the right product is shipped and received every time. “Four Ways a 3PL Can Help with Outsourcing Inventory Management.”

Personalized Approach

At Falcon, we don’t believe in a one-size-fits-all approach. Instead, we recognize that each brand is unique, and the omnichannel fulfillment strategy will need to accommodate for the differences. Therefore, we are proud to offer a level of customized service our competitors struggle to match. Specifically, every client has a dedicated Account Manager who works closely with them. As a result, this has allowed Falcon to understand their client’s individual needs and build a process to help meet those requests. By taking this personalized approach, we ensure that our clients receive the tailored support they need to succeed in their omnichannel fulfillment endeavors.

Eco-friendly Custom Packaging & Kitting Services

If you have been fulfilling in-house and want to jump to an omnichannel fulfillment strategy without losing the personal touch, Falcon can help. Specifically, Falcon offers on-site branding and packaging solutions to ensure a seamless brand experience across all sales channels. For instance, we can provide perfect-sized packaging, printed inserts, and even detailed personalization. As a result, you can maintain a strong brand identity while expanding your reach through multiple channels.

Falcon Omnichannel Reference Sheet

Beginner’s Guide to Third-Party Logistics (3PL)

Let the experts at Falcon Fulfillment walk you through the omnichannel fulfillment possibilities for your brand today.

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by Jamie C. Winters