What is 3pl Amazon?
3pl Amazon; a third-party logistics service is an outsourced service provider that offers companies logistics services and solutions like handling several aspects of a company’s supply chain, inventory management and warehousing, fulfillment services, shipping and return logistics, and many more.
Assuming you are shipping from China to US, 3PL can effectively handle the logistics activities. 3PL can be a viable way to improve sales or rapid business growth due to launching new products and improving your company’s overall efficiency.
Therefore, securing the service of the suitable 3PL for your brand is essential for a successful relationship. When searching for 3PL, be sure to select a 3PL that offers services and resources that correspond with your business needs. For instance, if you’re an Amazon seller, it is best to work with 3PL Amazon. To avoid customer satisfaction issues and less quality service, it’s essential to ensure your potential 3PL service provider can meet all your brand requirements. That is why it’s important to ask a few questions from available 3PLs to know your company’s most appropriate one. These questions include:
- Does my order volume exceed the monthly fees charged by the 3PL?
- Is it beneficial for my company to outsource logistics services like picking, packing, transporting, and return logistics?
- How well do they understand my market? Do they work with similar brands and products?
- How well do they know the ship channel I want to ship to? Are they already shipping there?
- Do they have software and technological tools that meet my needs?
- What do previous clients say about their services?
Pros of Working with a 3PL
Warehousing and Fulfilment Center
A reputable 3PL provides sufficient warehousing space for your inventory storage in the warehouse. Also, they offer some warehouse management software and tools for optimal daily inventory management. Although you have to pay for storage space within their site, they allow you to distribute your inventory to various warehouses with the country, thus saving you some shipping fees.
Personal Attention to Your Products
When you work with 3PL, you get a dedicated account manager who monitors and manages your sales growth. So, they discover and resolve any possible logistics issue that may arise. The account manager keeps you updated throughout the onboarding process and stays in touch before and after the product launch. This fosters efficient management of sale activities and improves your sales growth.
It is hard to be an expert in every aspect of logistics like inventory management, fulfillment, shipping, warehousing, and more. Fortunately, an established 3PL provides you with a range of experts to handle various logistics activities from distribution infrastructure, picking and packing, to shipping and handling. You can be rest assured that logistics professionals will handle your products. Working with experts relieves you of stress when shipping internationally. For instance, when shipping from China to US, 3PL will effectively help you handle the international shipping protocols like documentation, customs clearance, customs duties, and many more.
Most 3PL offer many value-added services and customization options that reflect your brand’s identity. Most 3PLs provide you with packing inserts, specialty packaging, in-person inventory counts, and many more. So, 3PL lets you customize your boxes and internal packaging according to your brand’s unique specifications, thus promoting your brand’s identity. Moreso, reputable 3PLs offer excellent business-to-business (b2b) and business-to-consumer (b2c) consumer service. They can help you handle both b2b and b2c fulfillment and support different e-commerce sales channels like Amazon, Shopify, and even brick and mortar stores.
Cons of Working with 3PL
Small Order Volume
3PL is not the best option for shippers or online sellers just starting and ordering in a small volume. It won’t be cost-effective for you to use 3PL. If you are not getting plenty of orders each month, it might not benefit you to have inventory in storage with a 3PL until you are sure you will be shipping out a steady amount each month. This is why some people prefer to use the Amazon FBA service when shipping from China to US.
Finding a Reliable 3PL
Due to many 3PL service providers in the market, it is not easy to find a competent and trusted 3PL that guarantees quality service. Not all of them deliver the services they claim. And working with an inefficient 3PL may affect your business/company reputation. However, by using recommendation and past clients reviews, you can find an efficient 3PL that offers services that meets your needs
Requires Advance Fees
3PL involves some initial cost which you need to pay monthly, or per SKU depending on the 3PL you’re partnering with. These fees include the following:
- Set up Fees: You have to pay this fee at once; it covers warehouse tours, software integration, training, and more, depending on the 3PL.
- Receiving Fee: 3PLs usually charge per shipment received to their warehouse in most cases. So, the charges may be an hourly rate for unloading, performing cycle counts, and entering products into an inventory management system. Conversely, it could as well be a flat rate per SKU or a flat fee per delivery.
- Storage Fees: Typically, 3PLs charge a storage fee per square foot or necessary space in their fulfillment center. But some charge on a per pallet basis.
- Fulfillment Charges: This cost cover fulfillment services like picking, packaging, labels, package inserts, package branding, among others. The fulfillment costs are determined by how many of the steps mentioned above are necessary for your products. So the cost varies.
Shipping Cost: You may receive a certain discount over shipping carrier listed rates because 3PLs receive bulk shipping rates based on their scale, order volume, and discounts negotiated with specific carriers.