By: Scott Weiss, Vice President, Business Development, Port Logistics Group
A Third-Party Logistics (or 3PL) service provider can offer great value to a manufacturer, importer, or retailer regardless of how small or large the operation. A 3PL partner allows you to outsource your inventory management, warehousing, and fulfillment operations.
Here are three advantages of partnering with a 3PL for your ecommerce logistics operation:
No More HR Headaches
Let’s face it – in today’s world of COVID-19, managing a labor force has never been more challenging. One COVID-19 outbreak at your distribution center can lead to a facility closure for days and generate negative goodwill among employees.
Operating your own facility and managing labor pre-COVID was challenging enough. You’re required to manage a labor force based on seasonality and ensure proper training as well as remain compliant with state labor laws all while working to maintain a productive and happy staff.
Labor is the biggest cost for a 3PL – so they excel at managing this aspect of the business as efficiently and productively as possible. Most 3PL-owned distribution centers are shared allowing for a communal labor force, spreading the team out based on the needs of the shipper. With this model, your labor costs match your volume needs whereas running your own DC requires a fixed labor force despite fluctuations in cargo.
Flexibility with space
A 3PL either operates a shared warehouse or a dedicated warehouse – or in some cases both. In a dedicated warehouse space, you are the sole customer and the entire facility is dedicated to your cargo needs. In a shared warehouse space, you are provided a base footprint and have the ability to flex up and down as needed.
Typically equipped with an in-house engineering team, your 3PL partner can help determine the most cost-effective and efficient method to store your product such as pallet racking, wire decking, automation, and/or packing stations. This benefit helps shippers meet today’s tight performance metrics and maintain customer satisfaction.
Partnering with this service provider allows unlimited opportunities to grow your business by eliminating the space constraints of your own facility. Another advantage – your 3PL will often have a national network of facilities allowing your business the ability to maintain multiple inventories and fulfillment centers near growing consumer markets.
Do What You Do best.
Bottom line – your strength is the product you produce. Your focus should always be on what your selling and how you can grow your share of the market. You are not in the warehouse business – unlike your 3PL partner who is.
Keep your focus on the product, sales, and customer satisfaction and let a 3PL partner focus their time and money investing in all the aspects of running an efficient fulfillment center. Whether that is the HR requirements and automation needs or reporting and exceeding Key Performance Indicators (KPIs).
For retailers looking to establish an ecommerce presence for the first time or for a business looking to outsource fulfillment needs to a new consumer market – a 3PL partner can add value to your logistics strategy.
About the Author
Scott Weiss has 22 years of logistics experience and is Vice President, Business Development for Port Logistics Group, a leading provider of warehousing and order fulfillment services. The company operates 17 Distribution Centers around the country, including a facility near the Jacksonville Port Authority (JAXPORT) in Northeast Florida.