Things to Consider When Switching 3PL Providers

If you’re a business owner considering switching 3PL fulfillment providers, then you’re likely well aware of the many benefits of outsourcing your order fulfillment. Working with a third-party logistics (3PL) provider can streamline your business operations and reduce labor costs while providing customers with a better overall experience.

However, with so many 3PL fulfillment providers, knowing which is right for your business can take time and effort. To that end, here are some things to consider when you’re deciding whether or not to switch 3PL fulfillment providers.

It’s important to take a close look at your fulfillment provider. Specifically, are they meeting your needs in terms of service, cost, and reliability? If not, it may be time to look for a new provider. Here are seven questions to ask when reviewing your fulfillment partner.

• Are they meeting accuracy and on-time delivery expectations?
• What services are included in your fulfillment package, and are they meeting/exceeding your business needs?
• Are the fees you are paying in line with industry standards?
• How accurate and transparent is the reporting for tracking inventory and orders?
• Are they handling returns and refunds?
• On a scale of 1-10 (10 being excellent), how is the communication between you and consumers?
• Do they have the ability to scale with plans you have for the future?

Once you’ve identified potential providers, it’s time to do research. Read reviews and testimonials from other businesses that have used their services, comparing rates and solutions. If you don’t know where to begin, you might want to start with WarehousingAndFulfillment.com. This free service matches your specific business needs to more than 500 prescreened 3PL companies.

In addition, to super charge your search, you should prepare and submit RFP’s (Request For Proposal) to a few new providers. This will let you see what other companies you have targeted have to offer and if they are a good fit for you. Don’t know how to create an effective RFP? Check out our guide on common mistakes to avoid here.

Your customers should be your top priority. Chiefly, think about how the new provider will impact their experience. Could they receive their orders faster? Are there more choices for delivery? Do they provide better packaging and protection for parcels? What are the unique problems you are trying to solve in your supply chain and fulfillment needs? Contemplate the solutions you will be looking for in a new partner. Here are some common customer pain points that can be alleviated by working with a 3PL partner.

• Long lead times that result in stockouts
• Slow delivery timelines
• Lack of tracking and delivery communication
• Difficulty in making a return or exchange
• Items arriving damaged
• Disconnected inventory management systems that result in inaccurate stock counts (leading to customer frustration at the POS)

Before making a decision, make sure to ask any questions you may have about the services offered by the potential provider. Here are ten questions to get your creative juices flowing:

• What is your experience in omnichannel fulfillment? In other words, will your technology integrate across my sales channels?
• What kind of automation do you implement within your warehouses?
• What other technologies do you use to streamline operations?
• How do you handle receiving from vendors? Will I be required to palletize or barcode my inventory before arrival?
• How do you handle lost inventory or incorrect orders?
• How are your fees structured? Do I get charged for individual services like; kitting, picking, packing, and shipping or do you offer an all-inclusive option?
• What are your product specialties?
• Is there a minimum monthly order volume required to work with your organization?
• Do you offer same-day order processing?
• What kind of accuracy guarantee can I expect?