Ecommerce businesses often partner with third-party logistics providers to manage the fulfillment and shipping side. This allows owners to focus more energy on improving their products and customer service, and other critical business tasks.
But as with any other professional relationship, hiring a 3PL service provider entails benefits and challenges.
This article will discuss the role that 3PLs play in small or big businesses, the common challenges faced when working with them, and how to overcome these challenges for a smooth and streamlined fulfillment process.
How Does 3PL Work? Download our quick infographics here.
Why businesses work with 3PLs companies
Companies work with 3PLs for various reasons, mostly related to enhancing shipping and delivery for both the business and the customer. Here are some of the main reasons working with 3PLs is a good idea whether you’re a new or growing business:
- 3PLs are cost-efficient. Contrary to some beliefs, 3PL companies are not an additional expense. It helps save money for small businesses as these providers are experts in managing logistics and ensuring the optimization of money spent in the process.
- 3PLs help you focus on what matters most. With trusted logistics providers handling product shipping, business owners can concentrate on improving, marketing, and reaching the right customers, benefiting the business overall in the long run.
- 3PLs help you expand easily. Handling products and more orders becomes easier, allowing you to fearlessly offer and sell more products, thereby growing your revenue.
- 3PLs help you reach more places. 3PL companies also help businesses reach more customers. With the providers’ connections and expertise, it’s now easier to bring products to more places and people across the country.
9 Common 3PL challenges today
While there are obvious advantages to working with third-party logistics, providers encounter a range of challenges in today’s dynamic business environment. Some of the most pressing issues include:
1. Adapting to ecommerce
As the world of online selling continues to grow rapidly and exponentially, it is crucial for 3PLs to figure out ways of adapting to the unique demands of online retail, including handling smaller shipments, managing returns and navigating shorter fulfillment cycles to stay competitive.
2. “Last Mile” Delivery Options
‘Last mile’ delivery or getting your products to your customers is probably the most crucial stage in the completion of the delivery process.
It’s important to optimize last-mile delivery routes to ensure timely deliveries and meet the expectations of today’s discerning consumers. Especially those that require specific handling and urgent shipping.
See more Challenges in Last Mile Delivery.
3. Growing omnichannel retail
Omnichannel in retail is when businesses use multiple touch points when making a sale. Online sellers would sell on various platforms such as Shopee, Lazada, TikTok shop and Facebook Marketplace just to name a few.
It’s the 3PLs’ responsibility to manage and seamlessly integrate these channels and orders ensuring a consistent and cohesive customer experience across all platforms.
4. Managing and tracking multiple inventory
Handling inventory across different locations and sales channels requires efficient and effective systems in place to prevent stockouts, overstocks and discrepancies in the inventory.
In these instances, real-time inventory tracking becomes a requirement for accurate demand forecasting and planning.
and discrepancies in the shipper’s inventory
5. Safety and security
Ensuring the safety and security of transported goods is one of the most important factors to consider for 3PLs. They must maintain robust security measures to prevent damage or loss of products or theft, especially in unexpected situations like typhoons and other public emergencies.
6. Providing real-time visibility
Transparency in the supply chain is essential for both businesses and customers. 3PL providers face the challenge of providing real-time visibility into the status of shipments, inventory levels and order fulfillment processes.
7. Meeting fast fulfillment
Customers are not willing to wait long for their orders to arrive, making meeting fast fulfillment expectations a significant challenge. 3PL providers must optimize their processes to ensure quick order processing, packing and shipping.
they are in the country.
8. Rising fuel costs
With rising inflation rates, prices of commodities are also shooting up. Fuel costs are not exempted.
Fuel expenses take up a huge chunk of the 3PL companies’ operating expenses. And if the rising costs continue, it would be difficult to offer competitive pricing, which may lead to a huge cut in the overall revenue.
9. Environmental concerns
With growing concerns about the effects of logistics and transportation on the environment, 3PLs are held accountable to comply with certain standards that might entail a cost if not planned out and executed efficiently.
As a shipper, you can help by reducing your packaging waste.
How Ninja Van overcomes 3PL challenges
Ninja Van has had years of experience in the logistics industry, with strong presence all over Southeast Asia (SEA), and is always innovating to address and meet these challenges. Our goal is to provide seamless and hassle-free deliveries for our partner businesses and their customers.
Here are the ways we efficiently address these common 3PL challenges.
and provide seamless fulfillment for our shippers.
1. Tech-enabled inventory management system
Ninja Van invests in efficient technology, like the DWS (Dimension Weighing and Scanning), automated rollers, conveyors and multipurpose mobile scanners for accurate tracking and movement of your inventory.
We leave little to no room for errors, optimizing stock levels, and enhancing overall inventory handling and accuracy.
2. Seamless ecommerce integration
Our ecommerce API is easy to install and works perfectly with top ecommerce platforms, including Shopify, Pancake, WooCommerce, Anchanto, and more. This allows you to streamline and optimize your order fulfillment and shipping processes in one place.
3. Real-time inventory view
Through Ninja Van’s advanced and effective tracking systems, businesses get real-time updates on their stocks, providing insights and more time for proactive decision-making. This then minimizes any unforeseen problem that may arise due to poor tracking and monitoring of stocks.
4. Enhanced safety and security measures
Ninja Van’s state-of-the-art logistics and warehousing distribution centers is your business’ guarantee that your products are safe and secure from when the stocks are picked up, packed, sorted to when they arrive at the customer’s location.
In the complex world of ecommerce, Ninja Van’s technology-driven services can provide you with customized solutions designed to overcome these challenges and optimize your business for growth.
Make Ninja Van your 3PL partner today!
More logistics tips for your growing business:
The 6 Steps of the Order Fulfillment Process
Full Truckload and Less Than Truckload in Shipping
Shipping from China to the Philippines: An Easy Guide
