Are you a startup or a new business? Are you looking for an easy way to scale your business to accommodate more demand and orders? It’s easy to propel your business towards success with the right logistics partner – Zip Logistics!

A 3PL or third-party logistics offers a full suite of logistical services that you can rely on to support and fulfill certain parts of your business – Transportation, Warehousing and Storage, Order Fulfillment (Picking and Packing), Inventory Forecasting, Freight Forwarding, and Reverse Logistics.

Understanding Third-Party Logistics

Your business has a lot of different moving parts, and you need to partner up with someone who has the expertise, technology, and experience in the industry that can transform your business from average to extraordinary in a short time.

A 3pl or third-party logistics offers a full suite of logistical services.  The great thing about 3PLs is that they’ll be able to meet your specific needs, and it’s up to you to decide how much you want them to help. 3PLs work with you to provide the perfect solution for your logistical needs that help create value in ways that enhance your operational and financial performance.

How About 2PL and 4PL?

So, if the numbers overwhelm you and if choosing between 2PL, 3PL, and 4PL can be too complicated, then it’s time to look at what the other two options can offer.

2PL

A 2PL or second-party logistics provider offers services to handle the transportation component of the business’s supply chain and is responsible for getting the company’s goods from point A to point B.

4PL

A 4PL service provider essentially takes 3PL a step further by managing the resources, technology, infrastructure, and sometimes even external 3PLs to design a supply chain solution for your business. 4PLs usually encompass the services that 3PLs provide and act as a consultant role to organize your business functions for you.

While a 4PL focuses more on the design and execution of the business processes, they may collaborate with 3PLs, warehouses, and asset-based carriers to provide the services needed in the supply chain solution.

Different Fulfillment Models that Fit Your Business

There are many different models that businesses can use to complete the fulfillment of customer orders. The following three are some of the most common ones found.

In-House Fulfillment

In-house fulfillment occurs when the merchant completes each step of the fulfillment process internally without the help of a drop shipper or third-party logistics provider. This model is usually standard for newer merchants that are just starting to manage their inventory and pack orders at home.

Although in-house fulfillment allows the merchant to have complete control of their logistics processes, it takes up a lot of time otherwise spent on other business functions such as acquiring more customers and developing new products.

Third-Party Fulfillment

Third-party fulfillment is when a merchant hands the responsibility of their logistical needs to a third party.

Some examples where this may be required are when the merchant runs out of space and needs to hire more people, spends too much time packing boxes, or needs more time for other strategic processes.

Third-party services may be either 2PL, 3PL, or 4PLs, but they all offer convenience and professionalism for the business owner as they have been in the business for many years. However, it would be best if you did your due diligence as, in the end, the 3rd party can raise or lower your customer satisfaction levels.

Dropshipping Fulfillment

Dropshipping at a basic level means that the merchant never holds the product they sell from start to finish. Instead, the products are produced, stored, and shipped by the manufacturer. When a customer places an order online, the manufacturer dropships the product directly to the customer. However, this means that customers may have to wait to receive orders from from the other side of the world.

Advantages of Using a Logistics Partner for Your Startup or Small Business

Cut on Costs

Storage is much cheaper than self-storage companies and renting warehouses, and you only need to pay for what you use. Using 3PL means that your logistical needs are scalable and flexible, meaning that you can adjust your service due to your business’s varies or seasons change.

By optimizing your full-service packages (bulk freight, inventory management, order fulfillment, and return logistics), you can negotiate much lower prices than separate your services to different agents.  3PL companies partner with many other agents, and they usually get better prices than individuals do.

Save Time

By outsourcing your logistics, you can be physically free from managing freight bookings, designing delivery routes, organizing storage requirements, fulfilling (picking and packing) and ship orders. This time can be spent expanding your business, acquiring more customers, and developing new products.

Improve Customer Experience

Using a 3PL has much faster fulfillment with high accuracy and same-day shipping compared to in-house logistics. This allows customers to receive their goods quickly with the help of experienced professionals, leading to a great customer experience.

Work with a marketing expert

Some 3PL companies can leverage their experience within the e-commerce field for many years and have varying experience with helping and mentoring small merchants. By using a 3PL, you have access to the point of contact, which can help you navigate the challenges of your business by offering advice and inspiration to deal with potential problems.

Easy Data Management

Through 3PL integrated systems, e-commerce startups can easily manage everything and see the overall picture through analyzing the data from 3PLs. This allows a considerable value add-on as business owners can easily manage their stock and gain insights about their products and the market.

If you happen to be a new business owner starting your first e-commerce business, or an experienced business owner that is looking to grow and scale your business, a professional logistics provider like Zip Logistics can help you provide excellent customer experience while saving your money, time, and hassle in your businesses logistics.