It’s time to partner with a third-party logistics (3PL) provider. In 2020, ecommerce marketplaces saw record growth, due to the COVID-19 pandemic, which caused retail stores to close, forcing many brands and businesses online.
According to Digital Commerce 360, consumers spent $861.12 billion online in the U.S., up 44% year over year. Ecommerce in the U.S. hasn’t seen that level of growth in at least two decades, and experts at McKinsey & Company predict that “digital shopping is here to stay,” with online sales of both essential and discretionary items continuing to climb well after lockdowns have ended.
For brands struggling to keep up, a 3PL provider can help. Let’s take a look at some of the reasons why you should partner with a 3PL, the top five things a 3PL can do for your business, and what differentiates Whitebox.
When brands start, they often start small, and they often manage fulfillment in-house. With a small order volume, fulfillment is simple to manage… but when a brand’s order volume increases, however, it becomes difficult to focus on other areas of business.
What is a 3PL? On the whole, 3PL providers handle fulfillment, distribution, and warehouse management on a brand’s behalf. Successful warehousing and fulfillment requires specialized knowledge and in-depth market understanding. With a 3PL, brands gain access to this knowledge and transfer labor-heavy fulfillment processes, and cost-heavy infrastructure needs for storage to logistics experts.
As a result, brands have more time to focus on core business areas
without worrying about fulfillment, warehouse management,
or shipping networks and distribution.
Some 3PL companies also offer services in customer support and have the warehousing space that brands need to scale without investing in that space themselves.
Most established 3PL providers should offer the following five standard services: packaging analysis, shipping support, inventory management, reporting, and returns management.
Packaging plays an important role in delivering an optimal ecommerce experience. This service helps brands figure out how to optimize packaging to prevent damage during transit and reduce packaging costs. Additionally, more customers are looking for branded unboxing experiences with personalized, sustainable packaging. A 3PL company can help brands determine the appropriate packaging materials, dimensions, and designs to protect products, meet company goals, and satisfy customers.
Ingesting orders can become complicated, especially at high volumes. A brand needs to know when a customer places an order, what the order contains (such as product variation), and where the brand needs to ship that order to. And the brand needs to process all of that data and ship the order without delay so that it arrives at the customer’s doorstep on time.
Established 3PL companies have the technology to ingest, process, and ship orders accurately, efficiently, and quickly. They can help brands choose the best shipping option for each order so that it reaches the customer within the expected time frame. A carrier-agnostic 3PL company, such as Whitebox, has the flexibility to choose the most appropriate, cost-efficient shipping option to meet the needs of the brand and the customer.
Brands trust 3PLs to receive, manage, and track their inventory, providing regular inventory reports and alerts when stock is low. Transparent inventory management ensures brands have enough product to meet demand.
Certain brands require specialized inventory services. In food and beverage manufacturing, for example, brands must separate products with specific expiration dates and/or lot codes. Some 3PL companies, such as Whitebox, provide expiration-date and lot-code tracking to ensure traceability throughout the supply chain.
As a result, brands can find and pull expired inventory more efficiently to prevent spoiled products from reaching customers. Not all 3PLs provide these specialized services, so it is important for a brand to find a company that meets its needs.
In addition to inventory management, some 3PLs provide regular reports on sales performance to help brands identify their most and least popular products at any given time. Brands can use this data to better inform their marketing efforts and drive sales. Whitebox’s proprietary reporting tools provide unique insights that other 3PLs cannot—we do not use off-the-shelf reporting technologies.
Our self-built warehouse management system provides real-time inventory insights for forecasting, inventory planning, and order tracking. In addition, our technology collects multichannel sales data and combines it with fulfillment data on a single easy-to-use dashboard for smarter decision making, enabling fulfillment to inform sales and vice versa.
Whenever a product leaves a warehouse, there is a chance that a customer will return it. Whether it’s buyers remorse or not a good fit, brands need an efficient system to process, grade, and designate returns for resale or disposal. 3PLs can provide such a system.
Returns management is part of the supply chain that is sometimes forgotten. Returns compose a small percentage of a brand’s sales, but a high number of returns can indicate problems. Using reporting tools, 3PLs such as Whitebox can identify when customers are returning more of a specific product and why so that the brand selling it can work quickly to address the issue.
There are many 3PL companies, but not all of them provide all the services that brands need for modern ecommerce success. Some 3PL partners offer additional, differentiating solutions, such as strategic warehousing and customer service.
Warehousing is expensive, especially for a growing brand. Brands not only need to provision the right amount of space but also must hire the right people and build the infrastructure. By partnering with 3PLs that have established strategic warehousing with plenty of space, brands can avoid this cost and labor.
Whitebox has warehouses in Baltimore, Maryland; Memphis, Tennessee; and Las Vegas, Nevada, strategically covering 99% of the U.S. with two-day shipping coverage. And we recently added over 650,000 sq. ft. in warehouse space, scaling up our Baltimore and Las Vegas facilities to ensure that we have enough storage to meet demand.
Strong customer service is vital for ecommerce. However, handling customer inquiries in-house can be cumbersome. Partnering with a 3PL that offers customer service can alleviate the burden. Whitebox can assist in creating brand-aligned messaging for customer service and managing a brand’s customer service process.
Before choosing a 3PL, brands need to understand their goals—whether it’s cheap, flexible shipping, customizable fulfillment, or warehouse space—and find a 3PL that can help reach them. Most importantly, brands need 3PL partners that are willing to become extensions of their businesses and not just transactional providers.
Whitebox is ready to be your partner for 3PL,
meaning we’re invested in your success.
With a comprehensive proprietary analytics platform, a robust fulfillment network, and much more, Whitebox has the flexibility you need to thrive. Contact us today to learn more about our fulfillment services.