What Is 3PL Fulfillment and How Does a 3PL Work?
Quick answer: A 3PL (third-party logistics provider) takes over your logistics so you don’t have to run a warehouse. You send inventory to the 3PL, it stores your products, picks and packs each order, ships it to the customer with tracking, and handles returns. Your online store is connected to the 3PL, so orders flow to the warehouse automatically and you only pay for the storage and fulfillment you use.
What is a 3PL?
Third-party logistics (3PL) is the process of outsourcing logistics services. This includes anything that involves the management of one or more elements of a business’s procurement and fulfillment activities, including storing and shipping items around the world.
What Services does a 3PL Provide?
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Warehouse Storage3pl provides warehousing services to manage order fulfillment for multiple customers in one location, maximizing efficiency and reducing costs.
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Inventory Management
Inventory management is not simply about storing your company’s products, but also about synchronizing your inventory with your store in real-time, tracking inventory, and forecasting demand to replenish it in time to avoid delays in orders.
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Picking and Packing
In addition to storing your company’s inventory, 3PL has employees perform tasks associated with order fulfillment, including picking products from each order and properly packing them for shipment.
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Freight Forwarding
After the products are picked and packed, 3pl will ship them through a partner carrier. Different 3pl work with different carriers and a good 3pl will choose a carrier that has the right price and shipping speed. Some 3pl even work with local carriers to provide convenient and fast service for local orders.
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Expedited Shipping
Partnering with a 3PL allows your company to provide your customers with fast shipping options. Fulfillment centers send orders daily, which is much more efficient than if you were to process them in-house. 3PLs often work with carriers such as FedEx, DHL, USPS, etc., and will have a good discount and can offer faster delivery at a manageable cost.
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Shipment Tracking
In addition to handling the shipping process, 3PL will also have customer service dedicated to tracking the status of your order, and if any abnormalities are found in the logistics information, we will provide timely feedback to the logistics company and deal with it in a timely manner.
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Reverse Logistics (Returns) 3pl also offers reverse logistics services to handle customer returns for you, where the customer gives the returned product to the carrier and then dispatches it back to the fulfillment center.
What is the 3PL Order Fulfillment Process?
The first step in the 3PL process is receiving the inventory at a warehouse after being made. As soon as the stock has been received by one of our warehouses, it gets ready to go into storage.
During the next phase of the 3PL process, your stock is placed in one of our 3PL warehouses for storage. Each stock-keeping unit (SKU) has its own dedicated location in one of our warehouses. Our scalable solution means there’s more than enough room to scale with you.
When a customer places an order, the fulfillment part of 3PL begins. If your CMS is through Shopify or WooCommerce, our app ensures that orders are automatically passed through to the warehouse to be picked, ensuring a seamless, automatic process.
For non-mainstream platforms, orders can be uploaded by CSV/Excel spreadsheet.
As soon as the items have been picked up by warehouse staff, it’s time for them to be packed! Honest FulPhilment allows for custom packaging, branding, and inserts for your products.
The next step in the 3PL process is to ship your order to your customer, whether this is by land, air, or sea.
We offer our shipping services direct to your customer and to businesses. Our tracking software integrates with your eCommerce platform to keep up to date with orders and their fulfillment.
How 3PL Benefits a Business?
Reduce Investment Costs
There may be those who think it makes sense to run your own private warehouse and fulfill orders with your employees. As the business grows, the cost of labor, rent, packaging materials, etc. all increase, making it cheaper for 3pl to process orders.
Reduce Error Rate
As a business manager, you may be skilled in all of your company’s operations, but fulfillment and logistics, and transportation may not be your strong suit. As your business grows, a true logistics and transportation expert can reduce the trial and error rate and be of greater value to your business.
Improve Customer Satisfaction
Dealing with shipping, fulfillment, and logistics issues can be physically and mentally exhausting, leading to errors that affect the customer experience. 3pl minimizes the occurrence of order errors such as incorrectly shipped orders, missed shipments, delayed shipments, and incorrectly filled order information. This greatly improves customer satisfaction and will also attract the growth of new customers.
Why Honest FulPhilment Should Be Your New 3PL
Transparent and Easy-To-Understand Pricing
One of the most daunting aspects of 3PL is the hidden fees and complex pricing structure. It is a challenge to figure out the different fees for each service, such as unloading, loading, warehousing, storage, shelving, etc. We believe 3pl fees should be more transparent, that’s why choose our 3pl service, HF’s 3pl service has only two fees: packing fee and shipping fee, this fee also applies to our 18+ overseas warehouses, for more pricing details please check out our pricing page.
Everything Is Covered in One Honest Platform
The Honest Fulphilment App was built and is maintained in-house. Updates are released at least once a month as a result of feedback and feature requests from our clients. We also offer to develop bespoke modules for those who wish to automate and systemize specific tasks.
We are proud to offer a transparent and user-friendly system that anyone can use. There’s no lengthy fixed-term contract or complicated onboarding and setup process, just an easy-to-operate platform!
Global 3PL Warehouse Locations
With warehouses around the world at your fingertips, you can ship in bulk to any of your designated 3pl warehouses. Learn more in our guide to the 3PL global warehouse.
FAQ
What does 3PL mean?
3PL stands for third-party logistics. It means a business outsources part or all of its logistics, such as warehousing, order picking and packing, shipping and returns, to a specialist company instead of doing it in-house.
How does a 3PL work?
You send your inventory to the 3PL warehouse, where it is received and stored by SKU. Your store is connected to the 3PL, so every new order is passed to the warehouse automatically, picked, packed and shipped to the customer with a tracking number.
What is 3PL fulfillment?
3PL fulfillment is the order fulfillment part of third-party logistics: storing products, picking and packing each order, labeling it and handing it to a carrier. It lets online sellers ship orders without running their own warehouse.
What is a 3PL warehouse?
A 3PL warehouse is a facility run by a logistics provider that stores inventory for many different sellers and fulfills their orders. Sellers pay for storage and fulfillment instead of renting and staffing their own warehouse.
How does a 3PL handle returns?
The customer sends the item back to the 3PL warehouse, where staff inspect it, restock it if it is sellable or set it aside if it is damaged, and update the seller's inventory. This process is called reverse logistics.
Can a 3PL handle wholesale orders as well as ecommerce orders?
Yes. Many 3PLs fulfill both single-item ecommerce orders to consumers and bulk B2B or wholesale orders to retailers and other warehouses from the same inventory.