{"id":2524,"date":"2020-04-15T09:34:43","date_gmt":"2020-02-11T18:46:32","guid":{"rendered":"https:\/\/www.aihello.com\/resources\/?p=2524"},"modified":"2025-09-02T10:10:34","modified_gmt":"2025-09-02T10:10:34","slug":"heres-everything-you-need-to-know-about-3pls","status":"publish","type":"post","link":"https:\/\/www.aihello.com\/resources\/blog\/heres-everything-you-need-to-know-about-3pls\/","title":{"rendered":"Here’s Everything You Need to Know About 3PLs"},"content":{"rendered":"

What\u2019s a 3PL?<\/strong><\/p>

It\u2019s simple, you take theorders as usual, but a third-party logistics provider (3PL) fulfills them.Sounds seamless at first, doesn\u2019t it? It\u2019s the least concern for customersabout how an order they made online gets delivered to them. They\u2019ll hardly giveit a second thought, provided their order arrives safely and in a timelymanner. A third-party logistics provider is a link in the supply chain industrythat brands use to outsource part or all of a company\u2019s distribution andfulfillment services. 

Following the start and exponential growth of eCommerce<\/a>, the market for 3PLsexploded. Most established companies, like the Fortune 500 companies today,rely on 3PLS for order fulfillment<\/a>, and so should you!

It\u2019s not only about order fulfillment, but 3PLs also receive new inventory<\/a> fromyour manufacturers before shipment to consumers. A well equipped 3PL can alsohandle retail distribution and returns. In the end, they deliver your orderswith a stellar experience.<\/p>

When Should\nYou Enlist a 3PL?<\/h2>

Why wait until the ordersoverwhelm you? By the time the orders have overwhelmed you, you have probablydone so much damage to your brand<\/a> than you probably don\u2019t realize; you havebroken lots of promises to your loyal customers. To make matters worse, itdistracts you from your main goal of being wholly focused on your businessgrowth. 

These three key questions will help you when determining whether you need a3PL:

1. How many orders do you fulfill in aday?
<\/strong>
If you realize that you fulfill more than 10-20 orders in a day, so, you maywant to calculate the costs of partnering with a 3PL to help keep your profitmargins strong. Similarly, estimate your growth potential\u2014these areopportunities you may currently not be able to pursue\u2013by outsourcingfulfillment.

2. Do you often run out of inventorystorage space?
<\/strong>
It\u2019s not unheard of for brands to forget to include storage costs in theirfulfillment expense modeling. So, compare your current expenditure with estimatesfrom 3PLs. Then compare between bundling storage costs and outsourcedfulfillment; which one is a better value?

3. Is your business a coiled spring?
<\/strong>
Are you expecting a sustained spike in order volume? Unlike one-off flash salesor marketing<\/a> promotions? How about you estimate the costs and headcountnecessary to meet demand on your own, and then compare with the costs ofoutsourcing fulfillment.<\/p>

Types of 3PLs Providers<\/h2>

There are four vitalcapabilities you need to be on the lookout for when comparing 3PLs:<\/p>