You are in this blog interested in knowing what third-party logistics is. Maybe you are a researcher or an e-commerce seller. To give you a quick and detailed guide about it, let us first know its definition.

Third-Party Logistics or abbreviated as “3PL” is a supply chain management where business outsources their products for distribution, warehouse, and fulfillment services. They typically specialize in inventory, the fulfillment of orders like picking and packing, and shipping.

How does it Work?

  • Receiving: Seller will send their products to the third-party logistics company for inventory.
  • Warehousing: The company or warehouse will store the products ready for inventory.
  • Inventory: This includes checking of quantity, inspecting, and labeling.
  • Picking: Once an order is received, workers will pick the products from an order.
  • Packing: When the items are already picked, workers will start packing the orders ready to ship.
  • Shipping: Most third-party logistics company have their own shipping carrier. They can do the shipping for their clients, too.
  • Returns: Some also handle returns from customers.

How can it Benefit Sellers?

  1. It can save sellers time, money, and effort.
  2. Sellers will have the time to focus on their business growth, goals, and priorities.
  3. Sellers can also expand their reach through the networks of the third-party logistics company.
  4. Online stores can have better customer satisfaction because of fast fulfillment, neat packaging, and delivery.

How to Know if Your Business Needs 3PL?

  1. You’re shipping over 10 orders per day.
  2. Your products occupied almost all the space in your inventory.
  3. Your team can no longer handle the demand.

How to Choose the Right 3PL Provider?

Consider the following factors when choosing a provider:

  • Operating Hours
  • Volume of Products Handled
  • Performance
  • Technology

All these factors come to you, as a seller, and to the 3PL provider as well. Before checking into a third-party logistics company, make sure to have a check of your store first. Consider the factors above to know if the business needs a fulfillment service.