Navigating the vast ocean of eCommerce can feel like a daunting task, especially when your business is primarily based on Amazon’s robust platform. The list of tasks a seller must take on includes managing inventory, packing and shipping orders, handling returns, customer service, and much more. Thankfully, you don’t have to do it all on your own. Enter 3PL (Third-Party Logistics) companies, your dedicated crew members on the eCommerce voyage.
What is a 3PL?
A 3PL is a partner that lends a helping hand. They offer a comprehensive range of services, including warehousing, inventory management, order fulfillment, and delivery. By outsourcing these tasks to a 3PL, you free up valuable time and resources, allowing you to focus on growth and strategy.
What is Amazon?
In the world of eCommerce, Amazon needs no introduction. It’s an online marketplace behemoth, a platform where thousands of sellers worldwide list their products for millions of customers. Whether you’re a small home-based seller or a multinational brand, Amazon provides a platform where your products can reach customers across the globe. But with the vast opportunities come challenges—managing inventory, handling shipping, customer service, etc.–-these tasks can be overwhelming for sellers. That’s where 3PL companies come into play.
How Does A 3PL Work With Amazon?
In Amazon’s bustling marketplace, a 3PL shoulders the burden of logistics and operational tasks, freeing you to focus on the core aspects of your business. Services range from storing your products in a secure, climate-controlled warehouse, managing inventory, picking and packing orders, to shipping products directly to customers. A 3PL also handles returns and customer inquiries related to shipping and deliveries, ensuring a smooth post-purchase experience for your customers. Some 3PL companies even go a step further, offering powerful analytics tools that deliver valuable insights into your operations to optimize your business.
Understanding the Benefits of 3PL for Amazon Sellers
What Are The Advantages of Using A 3PL Logistics Company?
A 3PL takes the logistical load off your shoulders. From managing storage space to handling shipping and returns, a 3PL allows you to devote your attention to other critical aspects of your business, such as product sourcing and marketing. Furthermore, a 3PL can often negotiate better shipping rates with couriers due to their high volumes, resulting in cost savings that can be passed on to you.
Benefits Of Third-Party Storage & Fulfillment
Outsourcing storage and fulfillment to a 3PL means you don’t have to worry about warehouse rent, packaging supplies, or hiring staff for order fulfillment. Additionally, a 3PL’s expertise in packing and shipping can help prevent costly errors and delays, ensuring your customers receive their orders accurately and on time.
Improved Customer Service
With a 3PL handling post-purchase customer inquiries and returns, you can rest assured knowing that your customers will receive professional and timely service. This improved customer experience can lead to positive reviews and repeat purchases, boosting your seller reputation on Amazon.
A 3PL can easily scale its services to match your business needs, whether it’s a seasonal surge in sales or long-term growth. This flexibility eliminates the need for you to invest in additional storage space or staff during peak selling periods.
Comprehensive Tracking Services
Most 3PLs provide comprehensive tracking services, allowing you and your customers to know the exact location of your shipments at all times. Which means you can keep your customer updated on their delivery.
Criteria For Choosing A 3PL Provider
Diversification of Logistics Services
Look for a 3PL that offers a wide range of logistics services. Beyond basic storage and fulfillment, some 3PLs offer additional services like:
- Freight forwarding
The eCommerce landscape is ever-changing. A good 3PL is adaptable and able to adjust its services to meet the evolving needs of your business and the marketplace.
Understanding the cost structure of a 3PL is essential. Look for transparent pricing with no hidden fees. Remember, the cheapest option is not always the best—consider the value and quality of services provided.
The location of a 3PL warehouse can affect shipping times and costs. Choosing a 3PL with locations closest to your customer ensures fast and cost-effective deliveries.
International Service Network
If you’re selling internationally on Amazon, it’s beneficial to work with a 3PL that has an international service network. This can simplify international logistics and ensure your customers worldwide receive their orders in a timely manner.
Understanding a 3PL’s pricing structure is crucial. Some charge per order, while others charge per item. Make sure to choose a pricing structure that aligns with your order volume and business model.
Sales and Customer Service
Lastly, assess the 3PL’s reputation for sales and customer service. Read reviews and speak with current clients to gauge their satisfaction with the 3PL’s services. A 3PL that provides exceptional service can significantly enhance your customers’ post-purchase experience.
The Top 10 Best 3PL Companies for Amazon Sellers
ShipHero stands out as a leading 3PL provider with its user-friendly software, comprehensive services, and strategic warehouse locations. They offer kitting, bundling, and returns management, among other services. Their dashboard provides sellers with real-time inventory visibility and order tracking, allowing for seamless operations.
#2 Red Stag Fulfillment
Known for their high accuracy and customer service, Red Stag Fulfillment provides a range of services that include pick and pack, kitting, and custom packing options.
ShipStation is a 3PL provider that specializes in order fulfillment and shipping solutions. They offer a robust platform that integrates with various e-commerce platforms and marketplaces, and features such as order importing, batch processing, and customizable packing slips.
Whitebox offers an all-in-one solution that includes 3PL services, listing optimization, price management, and customer review analysis.
#5 FedEx Fulfillment
Leveraging their vast logistics network, FedEx Fulfillment provides an array of services, including warehousing, fulfillment, packaging, transportation, and reverse logistics.
Easyship offers a global fulfillment solution with access to over 250 shipping solutions and rates discounted by up to 70%.
Offers flexible storage and fulfillment services with no long-term commitments. They have a wide network of warehouses, offering nationwide coverage.
This 3PL offers a global reach with services like storage, order processing, shipping, and return handling. They have warehouses in the U.S., Canada, Europe, and Asia, which makes them an excellent choice for international sellers.
#9 Fulfillment by Merchant Warehouse (FBMW)
FBMW specializes in serving Amazon FBM sellers. They offer competitive pricing and flexible storage options.
#10 eFulfillment Services
They offer transparent pricing and a comprehensive suite of services, catering primarily to small and mid-sized businesses. They also provide a “no long-term storage fee” guarantee, making them an attractive option for sellers with slower-moving products.
Top 3PL Solutions for Amazon Sellers
Alternative 3PL Solutions
As an Amazon seller, you have a plethora of 3PL companies to choose from, all offering a variety of services. Apart from ShipHero and others on our list, you may consider options such as ShipNetwork, Thill, or IDS Fulfillment, among others. All of these companies have their own strengths and specialties.
How Do You Choose the Right 3PL Company?
Choosing the right 3PL company involves considering factors such as their service range, expertise, pricing, scalability, and reputation. Take time to understand your needs and future plans. For instance, if you plan to expand your market internationally, you’ll need a 3PL with a broad global network.
Leveraging 3PL for eCommerce
3PLs For eCommerce Order Fulfillment
Third-party logistics companies play a vital role in eCommerce, handling critical operations. With a 3PL like ShipHero, eCommerce businesses can focus on their core competencies, like product development and marketing, while leaving logistics to the experts.
Looking for an eCommerce Fulfillment Partner?
If you’re seeking an eCommerce fulfillment partner, it’s crucial to consider not just cost, but also service quality, integration with sales channels, and scalability. You’ll want a partner that offers transparent pricing, integrates with popular eCommerce platforms like Shopify and Amazon, and can grow with your business.
If you want to talk to a fulfillment expert, let’s chat!
Why Use Amazon’s Fulfillment Alternatives?
While Amazon offers its own fulfillment services called Fulfillment By Amazon (FBA); there are valid reasons to consider alternatives. These include avoiding long-term storage fees, gaining more control over inventory, or seeking better customer service. Additionally, using a 3PL allows you to diversify your sales channels beyond Amazon.
Amazon Fulfillment Concerns
Amazon’s FBA service, while convenient, isn’t without its drawbacks. Long-term storage fees, complex fee structures, and lack of control over customer service are common concerns. Also, Amazon’s stringent requirements can lead to account suspension for minor infractions. These are some reasons why many sellers are exploring alternatives.
Enhancing Customer Experience
Improve Customer Experience With Shipment Notifications
Providing real-time shipping updates can significantly enhance the customer experience. With a 3PL like ShipHero, you can send updates to your customers at every stage of the delivery process. This not only keeps customers informed but also builds trust in your brand.
Improved Customer Experience Overall
A good 3PL provider offers a host of services that can indirectly improve your customer experience. From ensuring accurate pick and pack processes to reduce errors, to providing faster shipping options—all these can lead to higher customer satisfaction.
Quick Delivery With Low Shipping Costs
One of the advantages of using a 3PL is access to their network of carriers, which can help you achieve quicker deliveries at competitive rates. This is a game-changer in today’s eCommerce landscape, where customers expect fast and affordable shipping.
Better Inventory Management
Proper inventory management is crucial to avoid stockouts or overstocking. A 3PL provider can offer real-time inventory visibility, automatic reordering, and other features that ensure your stock levels are just right.
Navigating the eCommerce landscape, especially as an Amazon seller, presents a unique set of challenges. As your business grows, managing logistics operations in-house can become overwhelming, diverting your focus from strategic growth initiatives. This is where 3PL companies come in. A reliable 3PL company, like the ones we’ve highlighted, can take over your logistics operations and give you more time back. Whether you’re a small seller just starting out or an established brand looking to scale, there’s a 3PL out there that can help you navigate the exciting voyage to eCommerce success!
Frequently Asked Questions
Does Amazon Use 3PL?
Yes, Amazon utilizes a variety of 3PLs to manage different aspects of its supply chain and logistics.
How Do I Choose a 3PL for My eCommerce Business?
Choosing a 3PL for your eCommerce business requires careful consideration of several factors:
Remember, it’s important to compare several providers and consider your unique business needs and growth objectives before making a decision.
What Type of Logistics is Amazon?
Amazon uses a mix of different logistics types. In addition to its in-house logistics operations (which include warehousing, order fulfillment, and transportation), the eCommerce giant also relies heavily on third-party logistics (3PL) providers for functions like last-mile delivery.