3PL Warehousing Solutions: Grow Your Business with Our Expertise

Most people don’t dream of starting an ecommerce business because they love picking and packing. They do it for the product or the company’s mission. However, no matter what industry your direct-to-consumer business falls under, logistics management and all that goes with it is a big piece of creating a successful ecommerce business.

When an ecommerce company starts, most people pack boxes from their garage, basement, or living room and drop them at the local post office. However, this method becomes unsustainable as the company grows, and the entrepreneur faces a choice. Does the company build its own logistics infrastructure and Team, or do they Partner with a 3PL provider?

This can be a tough decision, with pros and cons for each choice, and it is essential to take the time to calculate the ROI of your fulfillment operations, whether you are looking at ecommerce fulfillment or warehousing and distribution for a retail facility. No matter which direction you choose, warehousing requires time, effort, money, and management. However, by working with a third-party logistics provider, or 3PL, you defer much of the heavy lifting to the experts, who do exist because they love picking and packing.

However, like with any Partner, it is vital to calculate a warehousing Partner’s ROI to ensure the benefit is worth the cost. Many KPIs can determine the ROI, the most common of which is cost savings or calculating what you would spend running operations yourself versus what you pay a 3PL. However, in the case of a logistics Partner, the savings run past what shows up on a balance sheet. Here are five things you save when you work with a 3PL provider for warehousing and logistics solutions.

1. Working with a 3PL saves Money

Okay, this type of savings can be seen on a balance sheet. However, don’t forget all the different line items that need to go into calculating those savings. To manage your own logistics, you would need to calculate the warehousing space cost, the warehouse’s operational costs, technology, freight management, inventory control, equipment, and more. If you need temperature-controlled warehousing, don’t forget all the systems required to control and maintain temperature and the specialized equipment because it takes more than just an air conditioner! You also can’t forget about repair costs, upkeep, and upgrades. Another cost to consider is labor and all that goes with it, including training, recruiting, benefits, and more. Keep in mind there are a lot of positions you will need to fill that many people outside of the logistics industry don’t think of, like plant engineers, safety managers, inventory control, and many others. You also have to make sure you keep up with safety regulations and are prepared to coordinate inbound and outbound freight. A lot goes into maintaining a storage building with cold air and making it run efficiently. Running your own warehousing operations, all falls on your shoulders, including the unexpected costs and challenges. When you work with a third-party logistics provider, you pay a set fee that you can depend on and plan for, and when unexpected issues arise, like needing new equipment or more Team Members, you won’t have to pay for it.

2. Working with a 3PL Saves Time

Think about how most start-up ecommerce companies manage their inventory. It usually involves an Excel file and a lot of emails. When you are just starting, this is accessible and manageable.  As the company grows, though, it’s a full-time job and not always the most accurate.  Calculations are done manually for every skew, numbers must be entered for each supplier, and order data has to be entered piece by piece.  It takes time, patience, and extreme attention to detail, and even then, numbers aren’t in real-time, and not everyone is operating off the same information, increasing the likelihood of items going out of stock or being sent inaccurately. As a company grows, the technology and picking and packing process must grow too. Most 3PLS have technology that integrates with software like Shopify, ShipStation, or propriety software to help automate the process. Many also have technology to help with inventory management, like our Burris Supply Chain Portal.

This saves a ton of time and increases accuracy. Using a 3PL also saves time because it takes logistics out of the equation of day-to-day management, allowing you to focus on large business items like product development, marketing, and sales.

3. Working with a 3PL Saves Space

As strange as it sounds, space can be hard to come by right now, especially regarding warehouses. With a growing demand for ecommerce and the need for facilities to be large and in an area with the infrastructure to support a heavy volume of truck traffic, it’s not always easy to buy a space for a warehouse. Plus, in today’s society, two-day delivery is paramount, meaning so is the need for warehousing facilities across the country, positioning you in various shipping zones. Limited space can also hinder product development, forcing tough choices regarding what products go to market and how many skews you can offer. Having a 3PL removes the need for space to store boxes upon boxes of products.  It also allows space to grow as you do, not forcing you to stay in the confines of your warehouse. Most 3PLS have multiple locations (at Burris, we have 8, click to see our locations), offering plenty of room to expand as you add new products or reach new customers. When considering the space you save using a 3PL, consider equipment space. Forklifts, docks, pallet jacks, and charging rooms are all extra spaces your 3PL provider already has accounted for, so you don’t have to.

4. Working with a 3PL Saves Customers

Order fulfillment accuracy. It is a huge factor in customer satisfaction. Working with a 3PL improves order accuracy from their industry technology to the checks and balances they already have. Duplicating that in your warehouse would require additional space, equipment, training, technology, and money. Using the technology and tools a 3PL provider offers, you can quickly and accurately complete orders with more order visibility. This increases customer satisfaction and ultimately saves customers.

5. Working with a 3PL Saves Headaches

Ecommerce Logistics and warehousing is all about adaptability. There are many moving parts to coordinate and adjust for, and only sometimes does everything go according to plan. The best 3PLs are the ones that know how to adjust. They have an IT team ready to tackle any technology hiccups or updates. Engineers are nearby if the equipment isn’t working at total capacity. They have connections with a freight brokerage company, like our sister company Trinity Logistics, they can call when they need help moving products quickly. When you run your ecommerce fulfillment and a truck can’t make the delivery time, or too many orders jam the system, or something spills, you get the call in the middle of the night. Using a 3PL with systems and protocols in place and a Team ready for whatever might happen saves you and your company headaches.

Conclusion

Warehousing is a massive part of any ecommerce fulfillment or distribution business.  It requires planning, coordination, and a lot of cash. Many KPIs exist to measure when deciding whether to invest in your warehousing or use a 3PL. From order accuracy to order fulfillment, inventory management, inventory accuracy, to picking and packing, a lot goes into the logistics management side of ecommerce and DTC businesses. Those pieces have measurables, statistics, and numbers to look at on the balance sheet, which are important. Yet don’t forget to add everything you save by working with a 3PL, too, like money, time, space, customers, and lots and lots of headaches.

 About MexLucky

MexLucky is the operational brand of MexLucky offering traditional cold storage, distribution, and direct-to-consumer fulfillment for Ecommerce companies. Since 1925, this family-owned company has expanded its networks of warehouses from Florida to Maine, and now out to the Pacific coast of California. For more information about us please visit www.Burrislogistics.com.