Feb 17, 2023 | 3PL Warehouse Management, Blog, Fulfillment
White glove service and personalization have become an increasingly popular way for customers to receive their goods with special attention given to each item, being thorough and not skimping on quality assurance. This article will detail what white glove services are, why they have become so prevalent in 3PLs’ offerings, and how companies like yours can provide these services efficiently and cost-effectively.
What Does White Glove Service Mean for 3PLs?
At 3PLs, white glove service is the ultimate in terms of personalized servicing. It goes beyond standard transportation and handling to provide premium care for high-value and sensitive items. These value-add services include extra attention to details like specialized packaging, inside delivery, installation, and even debris removal. Every customer has different needs, so this kind of service is tailored specifically for them – it requires additional fees, but they’re paying for quality.
Why are White Glove Services Gaining Popularity?
As the modern consumer’s demands for personalization and a high-touch experience continue to rise, along with the growth of e-commerce and the luxury market, white glove services are becoming increasingly popular for companies to respond to these changing needs.
Companies that offer white glove services can stand out from their competitors by providing enhanced value-added services such as specialized packing and delivery, something customers genuinely appreciate in this age. White glove services have become an ideal way to give customers the top-notch service they expect and add a touch of luxury every step of the way.
Companies quickly recognize that offering something extra in today’s competitive landscape is the key to luring and satisfying customers. White glove services give customers a personalized touch on orders, allowing them to customize their packages further and receive help with other added conveniences.
People always appreciate feeling like they have received special treatment. Hence, increasing the popularity of white glove services means 3PLs must embrace new levels of flexibility and creativity to meet customer expectations. As interest surges, it is clear that these extra services are here to stay.
Levels of White Glove Fulfillment
- Inserts: Inserts such as thank you notes, personalized packing slips, and discount offers are a straightforward way to add something special without too much extra work required by your warehouse employees. Plus, this is a surefire method for making sure your customers have great experiences with their purchases!
- Protective Packaging: Using high-end packing materials such as wood crates, packing peanuts, styrofoam, bubble wrap, and cardboard boxes, ensure every measure is taken to keep your shipment from any potential damage during transport. And don’t worry about the cost of these extra steps of protection – they can be taken care of by your client so that you don’t have to suffer any financial loss.
- Inspections: White glove fulfillment ensures shipments arrive quickly and safely. Some 3PLs perform pre and post-site inspections before assembling the shipped product to ensure everything is correctly configured. Consider spending more time on particular layers of labor that can add value – but keep in mind that these costs will have to be balanced against labor rates and availability when making promises to your customers.
- Product Assembly: Assembling or disassembling products is the highest level of white glove fulfillment services. Delivery professionals are responsible for unloading the shipment and setting it up safely and efficiently. Then, removing the replaced products and cleaning up debris gives your customers a pleasant experience. Providing these services might require an additional charge – but businesses want to ensure their customers get exactly what they want.
Ways to Up your Fulfillment Game
- You can improve your fulfillment game by implementing white glove fulfillment or other special service levels. A white-glove touch to your logistics handling services could separate you from your competition, allowing you to win new customers and create a stronger brand in a highly competitive industry like logistics.
- Professional warehouse workers employed with 3PLs are some of the most efficient labor forces in the world. With a proper training program, these workers can become even more impressive, specializing in white glove fulfillment. Not only will this help meet all your needs without fail, but it will also be an excellent investment for you over the long term. No need to spend extra time or money when you have an outstanding team already at hand! The skill and commitment of a well-trained team of warehouse workers make them worth every penny!
- Finding a 3PL provider with white glove personalized fulfillment services can be difficult, but it can be worth the effort for your clients! Having few providers to choose from means businesses utilizing these services will select fewer vendors and guarantee a higher quality offering. Why not make sure that your business is the one they pick? Building off the niche industry of white glove services could give you a leg up on the competition and help to ensure that your customers are getting what they need.
Should My 3PL Utilize White Glove Delivery?
Finding those high-touch, high-value clients willing to pay more for your services is the key to greater success in the 3PL sector. This way, you can increase operational capabilities and reduce client numbers without losing profitability. Differentiating yourself from the competition is as simple as adding white glove delivery.
White glove delivery isn’t suitable for every company, but its growing popularity means it’s now an attractive option for more and more industries. This unique approach could be just what you need to secure long-term success in the 3PL arena.
In conclusion, white glove services are gaining popularity, and different levels are available to providers. Service levels, pro teams, and niche 3PLs, as well as flexible capabilities, are all ways to up your fulfillment game. So when it comes to whether or not you should utilize white glove delivery for your 3PL business, that’s entirely up to you and your customer’s expectations.
White glove service might be worth considering if you have high-touch, high-value clients willing to pay more than the standard rate for this extra attention and care. White glove services can even allow you to take on fewer clients while surpassing the break-even point and making a profit. Ultimately it is up to each provider to decide whether or not white glove delivery will benefit their individual company goals and customer needs.
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Maggie M. Barnett, Esq. COO of ShipHero – Author
About the author: Maggie M. Barnett, Esq., is the COO of ShipHero. She is responsible for planning and executing the overall operational, legal, managerial, and administrative procedures, reporting structures, and operational controls of the organization. Barnett’s greatest strengths are leadership, risk mitigation, change management, and a passion for business transformation. She is known for her expertise in delivering operational excellence and her ability to provide guidance and mitigate risk. Her leadership of ShipHero is grounded in a servant mentality, always doing the right thing for our stakeholders. Her passion for ShipHero comes from the ability to drive operational excellence throughout the organization impacting the lives of our employees, customers, and partners.
Follow Maggie on Twitter & LinkedIn.
Mar 31, 2023 | Blog, Fulfillment, Warehouse Management Software
So, should you keep returns in-house or say good riddance? Keeping returns in-house can be costly, and thinking carefully about how best to handle this crucial part of your business is essential. Outsourcing returns can be a great option — but is it always the correct answer? Weighing the pros and cons ahead of time will help you decide if outsourcing returns is worth it for your eCommerce business. Let’s explore both sides of this debate so you can make an informed decision!
What is Outsourced Returns Management?
Navigating the world of returns management can feel like solving a complex puzzle, but when executed effectively, it can transform a potentially negative customer experience into a positive one. As an integral aspect of the supply chain and fulfillment process – returns management relies on the principles of reverse logistics to ensure that goods make their way back from customers to retailers smoothly and efficiently.
This dynamic workflow goes beyond simply receiving the returned product; it seamlessly integrates every step, from shipping and storing to updating stock levels in real time. When handled with finesse, accuracy, and a touch of tech magic, a well-coordinated returns ecosystem benefits not only the customer making the return but also potential new clients, stock managers, and payment operators.
By developing and implementing strategies to minimize the occurrence of returns, businesses can save valuable resources while ensuring maximum customer satisfaction. Remember, a well-oiled returns management machine makes the whole process more cost-effective. It fosters loyalty from customers who can trust that your business will address their concerns in a timely and friendly manner.
Advantages and Disadvantages of In-House Returns
Advantages
In-house returns can be both a blessing and a challenge for businesses, depending on the situation. One of the most significant benefits is the level of control it offers organizations over their operations, allowing them to tailor every aspect of the process to ensure the utmost customer satisfaction. This means that every returned item is handled efficiently and effectively, maintaining the trust and loyalty of the clientele.
The improved communication resulting from an in-house team’s deeper understanding of the company’s values and systems greatly benefits the organization. Since they are better equipped to represent the brand, there is a reduced risk of losing vital information due to miscommunication.
Disadvantages
Managing in-house reverse logistics programs can be challenging for businesses, particularly regarding scalability and customer expectations. Reverse logistics necessitate a diverse array of resources, which can sometimes be limited within a company. As various departments and teams compete for these resources, the efficiency and effectiveness of reverse logistics processes can be compromised.
Moreover, with giants like Amazon setting the bar high in terms of hassle-free return experiences, customers have come to expect a smooth and streamlined process when it comes to returns. Failing to meet these expectations can significantly impact customer satisfaction and brand image, making it imperative for businesses to invest in and prioritize a robust in-house reverse logistics program. Solidifying these crucial aspects of your business can help ensure long-term success and a loyal customer base.
Advantages and Disadvantages of Outsourcing Returns
Advantages
- Intelligent Automation
Embracing the advantages of outsourcing to a 3PL with intelligent automation can significantly impact an eCommerce business’s growth and success. Imagine no longer having to spend countless hours logging into various seller portals like eBay, Amazon, or Walmart.com to manage each return and refund request on your own laboriously.
Instead, cutting-edge software takes the reins, seamlessly integrating with those very portals, while the market-driven logic works tirelessly to automate your returns management. This results in faster refunds for your customers and reduced freight costs for your business.
- End-to-End Returns Management
By connecting their returns gateway to a reputable third-party returns management provider, sellers can benefit from comprehensive end-to-end management, ensuring a smooth and efficient process for handling returned items.
Partnering with a 3PL guarantees the highest possible recoveries, enabling sellers to resell returned goods at optimal value, thereby minimizing losses. A reliable 3PL can offer robust fraud protection measures, further safeguarding sellers from scams and fraudulent activities.
- Cost-Effective Shipping and Handling
Outsourcing returns management is a favorable decision for businesses because it leads to cost-effective shipping and handling and can help boost customer confidence. Companies can reduce operational costs and manage returns more efficiently by delegating this important aspect of the supply chain process to experts who deeply understand local and international customs. They also ensure that all returns are correctly tracked, regardless of destination, which can be essential in protecting a company’s bottom line.
- Access to Experience
One of the most significant benefits lies in gaining access to a wealth of experience through a 3PL. Having an expert team handling return logistics eliminates the daunting upfront costs associated with establishing an in-house returns center and ensures that seasoned professionals manage the entire process.
The knowledge and expertise of these experienced staff members can greatly enhance the efficiency and effectiveness of your return operations, fostering stronger customer relations and promoting a seamless overall experience. A close partnership with a reliable returns management provider can be an invaluable asset for businesses of all sizes.
- Reporting Capabilities
Migrating this process into expert hands provides the reassurance of relying on their robust reporting capabilities and well-established protocols. This essential collaboration allows for seamless tracking of returned items and a clear understanding of the costs involved. As a result, you gain valuable insights, enabling you to make well-informed decisions and optimize your business processes for better performance.
Disadvantages
- No Control of the Returns Process
One of the most prominent concerns is losing control over this aspect of the business, which might leave you uncertain about the future. Even though most logistics providers go the extra mile to adopt your brand’s identity, ensuring a seamless experience for your customers, it’s understandable that handing over this responsibility might be unsettling.
The key is to weigh the pros and cons carefully, evaluate the expertise and experience of the third-party company, and remember that building a robust and transparent partnership can help alleviate some of the challenges associated with outsourcing returns management.
- Integrating Technology
One significant challenge that arises with outsourcing is integrating technology smoothly between partners. This issue becomes critical as data must flow seamlessly between systems, and all parties involved need to have profound visibility to manage and optimize their shared networks effectively.
To achieve this, customers must be prepared to adapt to new systems and technological platforms, which can sometimes be daunting. Moreover, a lack of support and commitment from a company’s internal IT department can jeopardize the partnership’s success.
- Up-Front Costs
It’s important to appreciate that upfront costs, while seemingly daunting, are only part of the journey of unlocking value and potential growth for your business. When forming a partnership with a logistics provider, clients must be aware of the monetary implications and work towards establishing a shared strategic vision complemented by jointly determined KPIs. An outsourcing relationship should not be viewed as merely an expense but rather an investment in a strategic alliance that fosters innovation and contributes to a competitive advantage.
Does Outsourcing Really Save Money?
The concept of reverse outsourcing logistics might strike some as questionable when aiming to save money. It’s easy to wonder just how much reverse logistics costs can impact a company’s bottom line.
However, when we consider that approximately 15% of all goods are returned, and around 30% of those end up in landfills, it becomes evident that a staggering 4.5% of goods sold are essentially a lost cause from the get-go.
Imagine transforming this seemingly grim picture by enabling retailers to swiftly handle returns, repackage, relabel, and liquidate products. This potential twist in the narrative is precisely why many retailers are turning to third-party logistics (3PL) providers.
Through their collaborations with these providers, retailers are discovering innovative ways of making the returns process more sustainable, ultimately leading to substantial cost savings in the long run.
Make Returns Hassle-Free With ShipHero
In conclusion, the eCommerce returns process can be a complex undertaking. It may seem like a difficult decision to make when deciding between keeping returns in-house or outsourced. By understanding the advantages and disadvantages of both solutions, you are better prepared to decide for your business and customers’ needs. When staying in-house can help create more efficient processes and an enhanced customer experience.
On the other hand, outsourcing offers total peace of mind that all returns will be handled expertly and efficiently. Regardless of your business’s route, if you’re looking for easy access to a network of service specialists and solutions tailored to your fulfillment needs, consider taking advantage of what outsourced returns management offers. Are you ready to outsource? Call us today, and we’ll walk you through the process!
Subscribe to our blog to learn more, or click HERE to schedule a meeting today!
Aaron Rubin, Founder & CEO – ShipHero
About the author: Aaron Rubin is the Founder & CEO of ShipHero. He is responsible for planning and executing the overall vision and strategy of the organization. Rubin’s greatest strengths are leadership, change management, strategic planning, and a passion for progression. He is known for having his finger on the pulse of ShipHero’s significant initiatives, entrepreneurial spirit, and keen business acumen. His leadership of ShipHero is grounded in providing excellent customer service that drives improved business operations. His passion for ShipHero comes from the culture and his ability to impact the lives of employees, customers, partners, and investors.
Follow Aaron on Twitter & LinkedIn.
Apr 14, 2023 | Blog, Warehouse Management Software, Warehouse Operations
In today’s competitive automation market, managers and COOs are tasked with making decisions that will enable their 3PL to stay ahead of the curve. By leveraging digital twins, warehouses can meet ever-changing customer demands and save time and money. In this blog post, we’ll explore how digital twinning works and examine if it could be the future of automated warehousing for your 3PL.
What are Digital Twins?
A digital twin is a virtual replica of a physical warehouse that can be as simple or complex as needed. For example, suppose your warehouse workers move a pallet from one area of the warehouse to another. In that case, it shows in real-time on your digital twin software by gathering real-time data from sensors within the facility.
The use of digital twin technology allows for better oversight of the performance of an asset (a warehouse in this case), identification of potential faults, and informed decision-making regarding maintenance and the asset’s lifecycle.
Essentially, digital twins are computer programs that take real-world data and produce simulations or predictions of how a physical object or system will be affected by those inputs.
That way, you can optimize your operations without experimenting in the physical space. Plus, digital twins can act as prototypes for products that don’t even exist yet. They’re a powerful tool for 3PLs who want to stay on the cutting edge of automation technology.
The Importance of Automation
Finding enough skilled workers to keep pace with demand is challenging for most warehouse operations. Fortunately, we’re in the midst of a technological evolution allowing us to automate many of these processes.
Thanks to the Internet of Things (IoT) and artificial intelligence (AI) breakthroughs, warehouses can now handle changing eCommerce demands. Warehouse automation is now mainstream, and businesses that don’t invest in it risk being left behind.
The Benefits of Digital Twins for Warehouse Automation
Digital twins connect assets with data to create a complete picture of what’s happening. They allow teams to collaborate more effectively and make better decisions by analyzing past and present conditions and predicting future issues. Using simulation and 3D visualization, companies can understand how different scenarios might play out before they even happen. Just look at some of the benefits of digital twins.
- Improved efficiency: Using digital twins can identify inefficiencies in the warehouse operation and suggest improvements, such as optimizing the warehouse layout, reducing worker travel time, and reducing order picking and packing time.
- Predictive maintenance: Monitoring equipment health and predicting when maintenance is required can reduce equipment downtime and extend its lifespan with digital twins.
- Real-time monitoring: Digital twins allow warehouse managers to monitor inventory. Warehouse managers can use digital twins to track inventory levels in real-time and detect any errors in real-time, improving visibility and reducing errors.
- Risk reduction: A digital twin can identify risks and hazards in a warehouse, such as collision risks, allowing managers to mitigate them.
- Cost reduction: Using digital twins, warehouses can improve profitability by optimizing processes and workflows.
Challenges of Digital Twins in Warehouse Automation
One big hurdle is how disruptive the adoption process can be for an organization. Digital twins can transform the way warehouses operate, but getting there involves change that touches many areas of a company. It’s like going through a renovation — the result can be amazing, but the construction process can be pretty disruptive.
- Data quality: To be effective, digital twins require accurate and current data. Simulated results can be inaccurate when the data is incorrect or incomplete.
- Complexity: Developing and maintaining digital twins can take significant time and resources, requiring specialized skills and knowledge.
- Integration: Integrating digital twins can be challenging, requiring careful planning and execution.
- Cost: Implementing digital twins requires the use of hardware, software, and trained staff, all of which can be costly.
The Future of Digital Twins and Warehouse Automation
As eCommerce continues to increase, companies are scrambling to find ways to stay ahead of the competition in the fulfillment game. And that’s where digital twins and warehouse automation come in. They have the potential to revolutionize the way warehouses operate, making them faster and more efficient than ever before.
But the impact of digital twins doesn’t stop there. The technology has already proven itself in industries ranging from healthcare to manufacturing, and even entire cities are starting to leverage it for more intelligent infrastructure. It’s safe to say that the future of digital twins is something to keep an eye on, as it will continue transforming how we live and work.
As we move into this digital age, these virtual counterparts of people, products, equipment, buildings, and cities become increasingly prevalent. From facility management to vehicle customization, digital twins provide a revolutionary path to streamline and optimize warehouse operations. The eagerness for cutting-edge technologies will only propel digital twins’ capabilities further in such endeavors.
Leveraging Digital Twins
Digital twins are a powerful technology that can revolutionize warehouse automation, and it’s no surprise, given all of the advantages they offer. Utilizing digital twins enables warehouses to streamline all aspects of tracking inventory, which, in turn, virtually eliminates human error from the equation. Ultimately, digital twins have the potential to become an industry standard for warehouse automation capabilities quickly.
ShipHero’s WMS is a comprehensive solution that helps retailers leverage comprehensive inventory and order management to reach peak efficiency channel-wide. With its user-friendly interface, deep integrations, and customizations, ShipHero can help you free up your warehouse team’s valuable time so they can work on high-value tasks instead of manual data entry. Click now to learn how to integrate ShipHero’s WMS in your warehouse!
About ShipHero: We make it simple for you to deliver your eCommerce. Our software helps you run your warehouse, and our outsourced shipping solutions eliminate the hassle of getting your products to your customers. With thousands of brands and 3PLs relying on us daily, we’re here to help with all your logistics needs.
Let us know how we can help you today by scheduling a call HERE.
Jun 9, 2023 | 3PL Warehouse Management, Blog, Economics of 3PL, Fulfillment
Understanding the Components of Carrier Costs | Understanding the Economics of 3PL
Surcharges are the bane of every 3PL operator’s existence. They not only drive up costs but can prove to be an unpredictable factor when calculating expenditures. Shipping rates are constantly in flux, and this complexity can make predicting costs a daunting proposition. 3PLs must be able to manage these costs effectively to ensure they don’t adversely affect their bottom line. The good news is that there are multiple strategies that your 3PL can employ to contain these costs and protect your profits.
Base Rate vs. Accessorial Charges
Understanding the actual cost of shipping can be challenging. Although base rates provide a starting point, they are not enough to give a complete picture. Additional charges, known as accessorial charges, can accumulate quickly, making it vital to comprehend what you are paying for. To manage your outbound shipping expenses, it is essential to understand the additional charges and address them whenever feasible.
What is a Base Rate?
Base rates refer to the basic cost of transporting products from point A to point B, and they are typically negotiated between you and your carrier.
Accessorial charges, on the other hand, are additional charges that may be tacked on for specialized services like lift gates or residential delivery.
Additional charges may be temporary and contextual, but your base rate will remain the same depending on your contract agreements.
How Do You Choose the Best Base Rate?
When it comes to selecting the best base rate for shipping, it’s important to consider all options. While it’s true that carriers’ base rates tend to be similar, package specifications can make all the difference in choosing the most cost-effective option.
Take into account package size, weight, and distance, as these will all affect the rate. But don’t forget about accessorials and additional fees, which can significantly increase the overall cost of shipping.
Tools like ShipHero rate shopping will compare base rates from different carriers in real-time, so you will always find the best available shipping rate per order.
What Are Accessorial Charges?
Accessorial charges are described as supplementary fees or surcharges imposed by a carrier for services not included in the basic delivery of a shipment. These services may include loading, unloading, packing, or unpacking. The carrier may also charge fees for waiting time or delays at the loading dock.
Accessorial fees have become a contentious issue in the transportation industry over the last few years, with carriers increasingly relying on surcharges to boost their revenue. According to a recent survey, over three-quarters of carriers view accessorial surcharges as crucial to their financial well-being.
With this knowledge, you’ll be better equipped to develop shipping cost strategies that work for your 3PL. You’ll also have more information to use when negotiating rates with carriers and shipping partners.
How General Rate Increases (GRI) Affect Base Rate
General Rate Increases are a reality of the shipping industry and have the ability to impact all players involved, including 3PLs. These increases are a direct result of rising costs across the supply chain, such as fuel, insurance, wages, raw materials, and other operational expenses.
Carriers can pass on these costs to shippers through an increase in rates. These GRIs are typically announced in October-November, providing carriers with time to adjust their base rates accordingly. While these increases may seem small, hovering around 4-6%, they can significantly hike carrier base rates for 3PLs.
Here are the current increases for the top three carriers:
UPS General Rate Increase 2023
Average GRI increase at UPS: 6.9%
Effective from: December 27, 2022.
FedEx General Rate Increase 2023
Average GRI increase at FedEx: 6.7%
Effective from: January 2nd, 2023
USPS General Rate Increases 2023
Average GRI increase: 5.5%
Effective from: January 22, 2023
Know What You’re Paying For
As the logistics industry continues to evolve, so do the complexities of managing accessorial charges and other fees. Accessorials can be a significant expense for 3PLs, but there is one advantage to these fees: they are usually negotiable, and the key to successful negotiation is understanding your surcharges.
You can leverage this information by knowing the percentage of these fees in relation to your total volumes. Carriers are more likely to be receptive to your proposal if you have done your homework and can present a clear case for why the fees should be adjusted. Regularly auditing shipping bills and disputing errors or overcharges can help recover unnecessary costs and improve carrier accountability.
How to Estimate Your Shipping Cost
Our Invoice Analysis tool provides a comprehensive overview of your UPS expenses. By importing your data and using our template, you can quickly identify where your money is being spent. Our tool breaks down charges into a clear and concise format, highlighting the fees that are most impactful to your bottom line. Say goodbye to hidden fees that drain your wallet – click the link above to make more informed decisions.
Common Surcharges By Carrier
Carriers use surcharges to ensure that their volume remains manageable. Although robots and software have automated certain processes, some aspects of shipping still require manual labor. For example, when carriers must handle large packages that won’t fit into an automated sortation process, they implement oversize charges to offset the additional labor costs.
During peak shipping seasons, carriers also take on seasonal labor to sustain their service standards and manage their increased workload. By understanding the common surcharges shipping carriers impose, you can take proactive measures to minimize your shipping costs. Some common surcharges by carriers are:
- Non-Machinable Surcharge: An additional charge will be applied for packages that require manual sorting beyond the normal automated process.
- Fuel Surcharge: Similar to other delivery services, a fuel surcharge is incorporated to account for the fluctuations in fuel expenses. This surcharge is calculated as a percentage of the standard shipping fee.
- International Fuel Surcharges: FedEx fuel surcharge percentage is subject to weekly fluctuations, depending on jet fuel prices.
- Delivery/Pick-Up Surcharge: It is important to know that shipments that require delivery or pick-up in remote areas will incur an additional fee known as an out-of-pick-up or out-of-delivery area surcharge.
- Handling Surcharge: FedEx applies additional handling surcharges to packages measuring more than 48 x 29 inches.
- Oversize Charge: This applies to packages over 96 inches long or 129 inches in combined length and width.
- Fuel Surcharge: UPS utilizes index-based pricing derived from jet fuel costs in the US Gulf Coast.
- Address Correction: Billed to the shipper for failed delivery due to an incorrect address.
- Over Maximum Limits Fee: Billed on packages weighing more than 154 pounds or more than 108 inches in length.
ShipHero WMS offers live rate shopping, so you won’t have to spend time figuring out which carrier is the most cost-effective for each shipment. Comparing and selecting carriers based on their rates, transit times, service levels, and surcharges can help reduce your shipping costs. Access to real-time rates will give you the information you need to make the smartest possible shipping decisions every time.
Additional Surcharges
DIM Weight
Dimensional weight, or DIM weight, is the formula carriers use to determine shipping costs by factoring in the size of a package. Lightweight and compact packaging can save on dimensional weight charges and transportation costs. But those who ship relatively light items in large boxes may end up paying more than expected due to this pricing model.
Peak or Demand Surcharge
Peak season and demand surcharges are additional fees carriers add to their base shipping rates to cover the increased operating costs. Typically, these surcharges come in the form of flat fees per package and may last for a fixed period or until further notice.
These peak season surcharges can hit your P&L twice; once when receiving inventory for the season and two when shipping parcels to customers. One way to avoid extra peak season costs is to use accurate demand planning. Demand planning will help you determine which products you need and where to send them to maximize your distribution strategy and optimize shipping costs. You can avoid peak season charges by ordering your inventory well before the typical peak season time frame (typically October-January).
Demand forecasting can also help you determine areas in the country where your products are most likely to be shipped – by moving products closer to these destinations, you’ll be able to cut down on transit times, fuel costs, and other transportation expenses, which includes surcharges.
Shipping Cost Strategies
Investigating accessorial charges is crucial to forecast your total shipping expenses accurately. 3PLs should take the following strategies into account:
- Negotiate fees with your carriers based on the volume of your shipments and their characteristics.
- Consolidate shipments to minimize the number of individual deliveries.
- Optimize packaging to reduce dimensional size and weight.
- Analyze and optimize shipping routes to lower fuel surcharges.
- Leverage technology to streamline the shipping process and reduce the chances of incurring fees.
By thoroughly understanding and addressing these surcharges, you can better manage your overall shipping expenses and utilize shipping cost strategies to maximize your budget.
Lessons in Outbound Shipping
As we close our discussion on outbound shipping, it’s vital to understand that it’s not just the base rates determining the overall shipping costs. Here are the key takeaways when you’re estimating your outbound shipping costs.
#1 – Know All Your Costs, Even the Hidden Ones.
When you begin negotiations, carriers will present any initial rate card with base shipping rates. However, those rates don’t tell the whole story. Ask about accessorial fees and how you can best avoid paying extra.
#2 – Analyze Your Shipping Invoices on a Regular Basis.
Pull reports that outline all the shipping costs for a set time frame (a quarter or six months) and take a closer look. Analyze these charges and ask your carriers for itemized bills if anything looks off. While this is time-consuming, understanding what you’re paying and why is the only way to ensure you’re not being overcharged. This data can also help you when your shipping contracts come up for renewal.
#3 – Plan Ahead to Avoid Peak Season Surcharges.
It’s important to order your inventory for peak season early. This is the best way to avoid paying peak surcharges twice, once when receiving inventory and again when sending individual orders to customers.
Outbound Shipping Cost Takeaways
Knowing the common surcharges by carrier and utilizing shipping cost strategies can help you save money in the long run. By taking the time to analyze your shipping costs and strategizing ways to reduce expenses, you can ensure that your business is operating as efficiently as possible.
ShipHero provides a plethora of tools and information to help you find the carrier that is right for you. With the use of our analytics and customized dashboard, you can shop real-time shipping rates to help you comprehend the total summation of your shipping fees, helping you stay informed and maintain complete control over the economics of your 3PL.
About ShipHero: We make it simple for you to deliver your eCommerce. Our software helps you run your warehouse, and our outsourced shipping solutions eliminate the hassle of getting your products to your customers. With thousands of brands and 3PLs relying on us daily, we’re here to help with all your logistics needs.
*Stats provided by Coyote Logistics*
Jul 10, 2023 | 3PL Warehouse Management, Blog
If you’re lucky enough to build out a successful and enduring SaaS product, chances are you’ll have to deal with technical scaling issues.
An advantage of being in the eCommerce fulfillment space is that large spikes in usage are usually predictable and can be planned for (with a notable exception: pandemics!), so while there are a few spikes throughout the year, there’s one everyone in the space is well aware of: Black Friday & Cyber Monday (Peak Season). From late November up until a day or two before Christmas, usage of our systems spikes by 2-5x.
For ShipHero’s use case, the real-time pressure on our systems is applied from people working at the warehouses and not end-users shopping from their homes (we get hit with that as well, but it comes in at different times so that we can control the flow). We have an advantage over most systems: physical space limits how much can be done simultaneously. You can only fit so many more people in the same warehouse during peak season.
So, how do we avoid having your systems break when they get several times more than their regular traffic? Well, there are a few things we do:
We Break it Ourselves Ahead of Time
We look at spikes in usage throughout the year, use our peakiest days as a reference, and target to comfortably do 2-3x that amount of traffic comfortably. We do that by artificially sending traffic to a non-production set of services, applying pressure to them, and tracking key performance metrics for the service (primarily, ensuring the servers remain healthy and response times don’t suffer).
If something breaks, we know where we have some work to do, and if it works, we go back and apply more pressure until it fails. We want to know when it’s likely to break and how. This is a relatively common practice known as “load testing.”
We also do something often overlooked but have caught issues more than load testing: we scale up our existing production infrastructure beyond what we think we’ll need. So, for example, if we’re usually running 100 AWS EC2 instances for a service at peak hours of the day, we slowly spin up more until we get 500 EC2 instances, all of which process real production customer requests.
If it goes well, customers get a slight performance improvement that day, and we burn through some money. However, when you add capacity, you start to hit service limits that aren’t related to load, the most common ones being the number of concurrent connections to databases and AWS default limits. So what we’d sometimes find is we need to request more IP addresses or a higher quota of elastic load balancer, both specific things to do ahead of time but very stressful and disruptive when in the middle of heavy usage.
We’ve also found that we can continue adding servers, but there are too many concurrent connections to a database at some point, and adding more just flat-out breaks everything.
No Big Changes leading up to Peak Season
What use is stress-testing a system if you make significant changes afterward? Because most of the stress during the busy system is with the humans at the warehouses, we ensure we don’t make any substantial changes to our system after we try to break it. This means no database version upgrades, performance improvements, or new features. With complex systems, it gets tough to predict how even small changes might affect other parts, so we carefully consider any changes in the 6-8 weeks ahead of Black Friday.
We change as little as possible during Peak Season
We make very few meaningful changes ahead of the busy season. We make fewer changes during the most active month. We froze our codebase for a few years and didn’t allow deployments to production. It was a great way to ensure no unexpected changes, but it had the side-effect of accumulating bug fixes and minor improvements for a month or two, which isn’t ideal.
So in 2022 and again this year, we’ve switched to setting an exceptionally high bar to land and roll out any code, but not a complete freeze. That means we expect every single code being produced to have an exhaustive amount of automated tests, manual QA, and a code review by at least two people where one of them is the domain expert, and make all the people involved in the process co-responsible for how it affects production. In practice, it can take a week to roll out something that usually takes hours, but we’re ok with that for a month out of the year. Productivity goes down by a ridiculous amount, but in return, we get productive customers at a time of the year when everyone’s heads down trying to get packages out the door.
We do other things at the organizational level, like having engineers on-call 24/7 to respond to incidents within minutes and hopefully get ahead of any issues before anyone notices.
It’s something we’re constantly improving, we’ve had years of exceptional reliability during peak season, and the only way to keep it that way is to keep making internal processes better all the time.
Martin Albisetti, ShipHero Vice President of Engineering
Mar 8, 2021 | Blog, Podcast, Warehouse Management Software
About the Podcast
Objects! with ShipHero talks with the entrepreneurs, innovators and idealists that put items on the shelf and bring packages to your doorstep. From hot sauce to board games, toothbrushes to frying pans, startup side-gigs to enterprise players, join ShipHero founder, Nicholas Daniel-Richards, as he demystifies the manufacturing and logistics behind some of our most beloved household objects, with transformational ideas that are guaranteed to make you say, why didn’t I think of that?. This fast-paced and intriguing podcast covers thousands of travelled miles in less than an hour, so next time you’re standing in your local store and see a label that says ‘Made in <A Land Far, Far Away>’, you’ll know just how it got into your hands.
If you are a successful entrepreneur looking to grow or an aspiring innovator with an idea, Objects! with ShipHero provides a detailed, 360° exploration with the masterminds behind modern ecommerce and shipping solutions. So settle in, buckle up, and prepare to get objectified! … no wait, not that. Get ready to say “I objects!”… we’ll work on it. Available on Spotify, iTunes and at this link.
Episode Introduction
Episode FORE of Objects! with ShipHero gets into the rough business of golf gloves, as we’re joined by Adam Karger and his company Scotch & Skins — a brand dedicated to upping your golf game with premium leather golf gloves and other high-end golf accessories.
“True differentiation didn’t have to be about being so different from everyone else, but rather celebrating really good materials– really amazing, natural materials. And this glove did that… and so we found a little bit of our voice.” — Adam Karger, co-founder of Scotch & Skins
As a tech consultant by day, an entrepreneur by night, and a new father around the clock, Adam shares his journey of designing and manufacturing a high-quality golf glove from scratch, with absolutely zero prior knowledge of making or selling gloves.
So how do you start a business selling a product you don’t know how to make? Join us as we learn how Adam, armed with only a laptop and an idea, forged the right partnerships to create his brand Scotch & Skins, set to tee off in the spring of 2021. (Already nauseous of these golf puns? Don’t worry there isn’t any more).
All Businesses Start With a Little Drive
Although he started as a novice in the manufacturing and design of golf gloves, Adam Karger is no amatuer in the golf world. Adam played Division 1 Golf at Colgate University and in his Senior year competed in five tournaments, posting a scoring average of 83.2.
Adam and his co-founder and friend, Bryce, had toyed around with the idea of vintage-style golf gloves for some time. With no prior experience, the road seemed long and challenging, and a lot of questions stood in his way like, how do you find a manufacturer? How do you design and get tech specs? How do you ensure quality? How do you source the leather?… to name a few.
But like all journeys, Adam began with a single, brave step towards his new future, after a couple beers with his friend of course.
“For me, it was a really interesting problem to solve. Because, I think when you’re building a company or a brand or a product, really it’s just solving a bunch of little questions, and the amalgamation of those answers turn into the go/no go of building a product or a brand” — Adam Carger
Where did Adam turn for the answers to these problems? Why, Google of course. The start of Adam’s journey was typing phrases “glove designer” and “glove manufacturer” into a publicly available search engine… Here he proved that there is no secret to success other than persistence, perseverance, and a little drive. (last one ;-p)
Play To Your Handicap
Adam’s philosophy of “partner with people who have the superpowers that you don’t” led him to Greg, a glove consultant with years of experience making all types of gloves, except golf gloves. Excited to work on a new project, Greg agreed to consult and Adam began to grow his team.
The first superpower Greg brought to the table was his large network of manufacturers, which they were able to whittle down to a few choices and eventually settle on a Connecticut-based leather manufacturer.
Currently, Adam’s home will be the fulfillment hub due to the minimum required investment and full control of the packing and boxing customization. In the spirit of partnering with people who have superpowers they don’t, Adam set the goal for his company to eventually work with a 3PL like ShipHero, because reaching that point means the company has gotten big enough to where order fulfillment takes up too much time and a 3PL partner is needed to help your business scale.
Avoid the Sandtraps
Golf gloves are typically made of natural leather or a synthetic substitute, so the question was which material was better for their business? With this first decision, Adam and Bryce decided that whenever they came to a similar fork in the road, they were going to take the path towards high-quality materials.
But, where would their journey’s excitement be without hitting the hazards early on? They wanted to use real leather, and golf gloves are typically made using Cabretta leather (not actually leather) because it is thin, form-fitting and “soft as butter”.
In hopes to stand out from this tradition, Adam and Bryce found an Australian distributor for kangaroo leather… and when the prototype was complete, they immediately realized their massive mistake. The kangaroo leather was extremely poorly suited for a golf glove, because the leather was not thin enough or flexible enough to be useful on the golf course. Luckily, they had a mulligan.
Their glove consultant Greg recommended UK-based Pittards, a top manufacturer of Cabretta leather with over two centuries of experience. A month after the kangaroo catastrophe, their next set of Cabretta leather golf gloves were a hole-in-one: thin, form-fitting, and supple. With this, Adam and Bryce realized that differentiating your brand doesn’t need to lead you down a difficult path; rather, choosing to celebrate really good materials is a way to differentiate in and of itself.
The Back 9
“We’ve evolved over time, but it makes you appreciate where you are when you think of where you started.” — Adam Carger
Adam found that being laser-focused on their first product allowed them to bring one high-quality and thoughtful product to the market and helped them to determine their company’s manufacturing principles. They then applied what they learned to making their Cabretta leather ball markers and North American hickory alignment sticks with covers made from North American leather from North American tanneries. How boujee.
Officially teeing off in the spring of 2021, Scotch & Skins is currently going through the final process of creating sizes, finalizing logo design, and will go into full-scale manufacturing soon with their premium golf gloves and assortment of high-end golf accessories.
So remember… if the glove don’t fit, you must not have shopped Scotch & Skins.
And be sure to check out https://www.scotchandskins.com/ and join their email list to be notified of product release.
How About You?
Have you been sketching the next big thing on the back of a cocktail napkin? Are you frantically Googling everything about it right now? Now, right now, is the time to make it happen. There’s loads of tools and resources available everywhere to convert the idea in your head into an OBJECT! on the shelf. All it takes is a little follow through. ⛳️
May 17, 2021 | Best Practices, Blog, Case Study, Fulfillment
Introduction
Masks are coming off and that means one thing… time to take care of your teeth again. Thankfully, the folks at BURST, a long-time ShipHero customer, are here with the affordable subscription service for oral care, championed by thousands of dental professionals across the USA.
BURST was co-founded by Hamish Khayat and Brittany Stewart in 2017, and in less than a year, they had already amassed hundreds of thousands of subscribers. It’s no exaggeration to say that they “BURST”’ onto the e-commerce scene. By the end of 2019, the company reported 100% year-over-year growth and a 140% increase in ‘BURST Ambassadors.’ These brand advocates, including dentists and hygienists across the country, now number more than 20,000 strong.
“Since switching to ShipHero, we’ve reduced our fully-loaded costs by 35%. At the volumes we move, that’s huge.” Brittany Stewart, President and COO, BURST
Fully-Loaded Cost means the direct cost of the applicable good, product or service plus indirect charges and overhead.
But as Brittany explains in our chat below, with meteoric growth comes challenges. Specifically, BURST’s 3PL partners were struggling to fulfill and ship orders at a breakneck pace that matched their growth.
Challenges
- Partnering with a 3PL to provide on-time shipping and fulfillment
- Ensuring the 3PL’s software can scale with 100% YoY growth
- Gaining order transparency to ensure BURST is able to deliver exceptional customer service
- Seamless integration with ShipHero APIs
- Fast and intuitive picking and packing capabilities for 3PL warehouse teams
- Visibility into order status for the customer experience team
- 100,000+ shipments per month
- Over 100% YoY growth w/ similar growth projected for the future
Brittany, what was your fulfillment process like BEFORE ShipHero?
Brittany Stewart: “We’re moving significant volumes—over a hundred thousand packages every single month. We’ve outgrown some 3PLs. The problem with most warehouses boiled down to their software capability—it wasn’t capable of scaling with our growth.
Honesty and transparency are so important in a 3PL partner. Issues are going to crop up—I just want to know about them. Our retention rate is directly tied to our ability to provide on-time fulfillment and unbelievable customer service. We can’t do that if we don’t know what’s going on.
We have a very close relationship with our fulfillment partner, Swoop. They started looking for a WMS that would help them scale with our growth. We tested out a lot of systems together, and nothing was quite as good as ShipHero”
Solution
ShipHero’s painless and intuitive warehouse management system. We also spoke with Brandon, the owner and CEO of Swoop (BURST’s 3PL provider).
Brandon, what has been your experience with ShipHero?
Brandon: “ShipHero has exceeded all expectations. For a lot of 3PLs, onboarding clients can be quite the task but ShipHero has found a way to make it very painless and very quick.”
Getting set up with ShipHero was exceedingly simple. A dedicated solutions engineer visited Swoop’s warehouse to help Brandon and his team with migration, education, training, and rollout. Brandon describes it as a “true partnership” as opposed to just another piece of software you invest in and never wind up using. After that, using ShipHero within the warehouse is intuitive.
ShipHero’s software is the perfect fit for e-commerce fulfillment 3PL warehouses looking to scale up. Part of what makes it such an effective solution is its seamless integration with must-have distribution platforms like Amazon.
Brittany, what was the integration process like for you?
Brittany: “We have a Fulfilled By Merchant (FBM) storefront on Amazon. It took us maybe a minute to integrate ShipHero into everything. Anyone who’s done FBM Amazon fulfillment knows that it can be a pain in the ass without the proper systems in place. With ShipHero, fulfillment is as easy as slapping labels onto packing slips. The integration is perfect and seamless.
With ShipHero, fulfillment is as easy as slapping labels onto packing slips. The integration is perfect and seamless.”
And what have you been able to accomplish since the switch?
Brittany: “Through ShipHero, we have the ability to export our orders, get transparency into what’s moving, assess issues, purchase labels, and ship on our accounts. It’s all stuff you need—laid out in a way that’s intuitive and useful for you.
“We have a team of 30 people responding to customer requests full-time. With ShipHero, they can see what’s going on with an order, make notes, and talk to the warehouse—all through one user-friendly interface.”
ShipHero also provides much-needed visibility into the fulfillment process for Brittany’s team. With it, they’re able to maintain the same exceptional, high-level of customer service that first catapulted the BURST brand into the limelight.
ShipHero has even worked with Brittany directly to add options that increase back-end efficiency. For example, instead of needing to pick and weigh each order individually, the ‘bulk shipping’ feature allows warehouse staff to easily pick and ship hundreds of the same product—perfect for a company with limited SKUs.
And if anything ever is confusing, Brittany has an easy-to-navigate knowledge database at her fingertips—help.shradical.wpengine.com—and she knows that ShipHero’s team is always standing by to help.
Results
Fully-loaded costs cut by 35% or more.
Brittany, what have been the lasting results of switching to ShipHero?
Brittany: “We have unbelievable retention rates because we strive to create an incomparable experience for our customers. Robust and user-friendly software makes that possible. A solution like ShipHero pays for itself over and over again. In 2020, we anticipate our growth rate doubling native to the US. Projections indicate that we’ll grow another 60–70% the year after. As for international growth—that’s another beast for another day.
To make that growth a reality, ShipHero is vital. We need software that will scale with us as our volumes increase and we expand into multiple locations. The ability to do that without extensively programming lead times (i.e., logic for routing one thing to one place and another thing to another place) is helpful.
“Since switching to ShipHero, we’ve reduced our fully-loaded costs by 35%. At the volumes we move, that’s huge. Robust and user-friendly software makes our high retention rate]possible. A solution like ShipHero pays for itself over and over again.”
BURST continues to have extraordinary retention rates for a subscription-based business, and that’s wholly thanks to their stellar customer service and super-fast turnaround times. According to Brittany, ShipHero is part of the solution that enables them to continuously deliver that high-quality service.
With ShipHero, Brittany is confident that her 3PL has a software solution that will enable them to keep pace as BURST expands—which is good, because the company’s growth doesn’t show any signs of slowing down.
BURST currently moves well over 100,000 packages each month. Brittany expects that number to double within a year—and that’s before BURST takes its products to an international market.
ShipHero delivers simple and smart warehouse management that scales with you. Let’s talk.
Want to be featured in our case study?
If you would like to share with us stories about your e-commerce experiences, whether it’s how you started your business, what opinions you have on the stories we share, or if you just feel like venting… we’re here for you.
Shoot us an email and you could be featured on an upcoming Case Study, our critically-acclaimed weekly news segment The Packet, or if you’re lucky, you could be invited to join one of our many Podcast episodes!
Oct 25, 2022 | Blog, Fulfillment, Podcast, Warehouse Management Software
The Entrepreneurs We’ve Talked To This Season
It’s hard to believe that our little podcast, Objects! With ShipHero, has reached its season finale already. But what a season it’s been! From laughter to tears, we’ve navigated the ups and downs of being an entrepreneur with the help of ten inspiring guests who have launched successful products in the eCommerce industry. We feel grateful to have been able to share our guests’ journeys and learn from their experiences—cheers to all our fellow entrepreneurs out there crushing it every day. Keep launching, keep learning, and keep growing.
Which podcast episode was your favorite? Which one inspired you? Let’s recap on a very successful season one and the fabulous guests we had along the way!
Episode 1: WiFi Thermometers and Hygrometers
Digital sensors. Who knew? Not these guys, until they discovered a way to make and sell digital sensors that measure humidity, temperature, and other environmental conditions. It turns out there are all sorts of people and businesses who need these sensors. So the entrepreneurs turned their creative consultancy into a thriving business, making and selling digital sensors to everyone from individuals to major corporations. What started as a simple idea has turned into something pretty amazing. Become a fan of SensorPush by listening to our podcast.
Episode 2: B Side: Sensor Push
If you’re feeling lost or adrift, take a page from Nick and Jonathan’s book and start selling something. It can be anything from your consultant skills or your story. The important thing is that you get started somewhere, and the rest will follow. Check out our interview with Nick and Jonathan from SensorPush to hear more about their entrepreneurial journey.
Episode 3: EDC Knives & Climate Friendly 3PLs
If you’re curious about the world of EDC, listen to our podcast with special guest Yong-Soo Chung. In this episode, you’ll learn about the community’s origins and what motivates people to seek out the best-made versions of unremarkable items. You’ll also hear hilarious stories about knives (you might even want to start carrying one yourself). Who knows? Maybe after listening to this episode, you’ll be inspired to launch your own online store for everyday carry enthusiasts.
Episode 4: D2C Jewelry Brand
Stefanie Taylor is the perfect example of a leader who knows how to read her market and adapt. She’s taken her 3rd generation retail jewelry company from $3M annual revenue to over $20M by being bold and pivoting her business model when necessary. If you want to learn more about being a successful entrepreneur, listen to our podcast with Stefanie herself.
Episode 5: Healthcare Fashion
If you’re in the market for a good cry, listen to our podcast with special guest Chat Razdan. The founder of a healthcare fashion brand, Razdan, is radically changing how hospital gowns and other medical devices look and feel. He founded his company without any experience in healthcare OR fashion, proving that anyone can make an impact in this industry. So pull up a chair, grab some tissues, and enjoy the story of one man’s mission to make healthcare more comfortable for everyone.
Episode 6: B Side: Urban EDC
The world is a big place, but it can be even bigger if you’re willing to explore. I think that’s what our guest today was trying to say when he told us how far his journey has taken him – from Wall Street right into coding school and then onto taking tests selling headphones on Amazon! Listen up because this podcast could give insight to anyone who doesn’t know where their passions lie or how they should use them as an income source with a special guest: Yong-Soo Chung.
Episode 7: Adult Toys (and MORE)
As a self-taught entrepreneur, Anna Dee quickly learned that the best way to succeed was to dive in and figure things out as they came. Starting with handmade items on Etsy, she soon expanded her offerings and developed her website for her now wildly popular dildo business. That little venture turned into five successful companies, including a warehouse, online store, and community, where she teaches others about entrepreneurship and maintaining a positive mindset. Be sure to listen to this fun podcast about extraordinary and unique products.
Episode 8: Antimicrobial Copper Phone Cases
Say hello to Nick O’Brien, the quintessential entrepreneur who didn’t let a global pandemic stop him from achieving his dreams. He co-founded a phone case company in quarantine and navigated the challenges of setting up a Shopify site and finding a manufacturing partner. And if that wasn’t impressive enough, his company even got featured on Good Morning America! How did he do it? Get ready to take some notes from this podcast and turn your quarantine ideas into a real business.
Episode 9: African-Inspired Fashion
Meet Chioma and Uchenna, the entrepreneurial sisters behind the booming African-inspired fashion brand Cee Cee’s Closet NYC. From humble beginnings selling their wares at pop-up shops to being featured on NYC billboards, these ladies know how to make a splash in the business world. So how do they turn social media content into brand loyalty? It’s all about authenticity and connecting with their audience on a personal level. The sisters share key lessons learned during their journey, like the importance of taking risks and staying true to your mission.
Episode 10: Vegan Cookie Dough
Erica Rankin is the mastermind behind Brodough, a vegan cookie dough company taking over Canada with its delicious and healthier-for-you treats. What started as a mere idea in Erica’s head blossomed into a full-fledged business, despite her lack of prior entrepreneurial experience. In this interview, we get to hear about Erica’s journey and learn some valuable tips for aspiring entrepreneurs. So if you’re looking for some culinary inspiration or just want to hear a delicious success story, be sure to give this podcast episode a listen.
Episode 11: Cold Water Smoking Pipes
Even if you’re not in the market for a smoking apparatus, Rich’s story is exciting and provides insight into what it takes to be a successful entrepreneur. He has over 20 years of experience in the retail industry, which gives him the knowledge and skills necessary to design, manufacture, and market his products. If you are looking for inspiration or want to learn more about what it takes to start your own business, check out this episode of Objects! with ShipHero.
Get Inspired to Start Your Business Journey
It’s always exciting to see and hear about successful entrepreneurs constantly blazing their trails and setting new goals. They serve as examples of what is possible and inspire us to think outside the box and push ourselves to do better. So go ahead and check out some of their stories, and remember– entrepreneur or not– never stop dreaming big.
Be sure to subscribe and follow Objects! With ShipHero on both iTunes and Spotify for even more success stories in season two. Thanks for tuning in!
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Objects! with ShipHero is a detailed, 360′ exploration of eCommerce and shipping one object at a time. John Wakim, your new host and ShipHero Head of Partnerships, will drill into the details to help you make sense of this world. If you have an object that you want to profile, please send a note to John Wakim at pitch@shiphero.com.
Click HERE to Listen on iTunes. Click HERE to Listen on Spotify.
About the host: John Wakim is the Head of Partnerships at ShipHero and Host of the Objects! With ShipHero podcast. As an early-stage entrepreneur with experience in SaaS, eCommerce, and retail, John has a diverse background. His innate ability to embrace challenges head-on makes him an early adopter at heart. No matter if he’s working alone, with an in-house or remote team, with a vendor, or with an agency, John can wear many hats and roll up his sleeves and work relentlessly to meet goals.
Aug 3, 2023 | newsroom
NetSuite is to Finance and IT what ShipHero is to WMS. As a result, NetSuite is used to manage dozens of internal functions that make your business run. However, keeping your warehouse data in sync with your system, giving your customer support team the information they need to resolve customer issues, and keeping your operations running smoothly needs more than a standard WMS.
The ShipHero team is thrilled to announce that they have achieved “Built for NetSuite” status for their WMS solution. The “Built for NetSuite” program recognizes solutions that meet the same level of standards for security, data privacy and overall quality as the solutions offered by NetSuite. ShipHero’s WMS for NetSuite solution is a powerful combination of ShipHero’s WMS, embedded tools within NetSuite, and a real-time two-way integration that moves data between platforms.
Here are the key areas areas where the NetSuite/ShipHero integration really shines:
Visibility
You’ll always know what’s happening in your warehouse with the easy-to-read NetSuite dashboard. NetSuite’s dashboard updates in real time, giving you instant awareness of any delays right when they happen. If an order is flagged or an action is taken on a shipment, that information is immediately captured and displayed, giving you the full story of an item’s delivery status.
Data Sync
Never wonder again if the data you’re seeing is accurate. The NetSuite/ShipHero integration allows data to freely move back and forth keeping your inventory counts accurate and helping you to avoid lengthy financial reconciliations on missed inventory or missing shipments.
More Efficient Processes
ShipHero with NetSuite brings you a fully paperless warehouse management experience, cuts down on error rates and waits for manual updates to show in the system. Plus, we can help you better schedule your workforce, to cut down on the number of overtime shifts. One of the best parts is that ShipHero is one of the easiest WMS to learn. Many of our clients have told us that they can get a brand new employee up and running on the mobile app in 15-20 minutes. No more waiting for your team to get up to speed.
ShipHero & NetSuite
ShipHero clients are already leveraging the NetSuite integration to boost their response time and keep customers happy. As an important player in the eCommerce space, ShipHero is committed to working closely with NetSuite to ensure our clients get maximum value from their customer service interactions.
Additional features of the ShipHero & NetSuite integration include:
- Bi-directional data synchronization
- Products & Kits
- Sales Orders
- Purchase Orders & Transfer Orders
- Inventory Quantities & Locations
- Serial Numbers, Lot codes and Expiration Dates
- Work orders & Assemblies
- Returns Implementation
The integration will also be handled 100% in-house by ShipHero, allowing you to go live in as little as 6 weeks without any third party involvement.
As ShipHero CEO Aaron Rubin says, “We win because of the quality of our software, the features of our software and our support and ops teams. As eCommerce continues to grow as an industry, close collaboration with our software partners is a top priority.”
Get the best warehouse operating system in the business and leverage the power of NetSuite with the backing of ShipHero. Get started now!
About ShipHero
ShipHero is a US based, leading provider of an award-winning cloud-based warehouse operating system that gives online retailers and third-party logistics providers the tools to ship more efficiently anywhere in the world. With more than 6,500 customers located around the globe, ShipHero offers online retailers a suite of services ranging from warehouse management software to outsourced fulfillment as a service. Additionally, ShipHero is the official fulfillment network partner for Shopify, and now has 9 owned and operated warehouses across North America to get our clients’ products to their customers faster.
Feb 16, 2023 | 3PL Warehouse Management, Article
Your business deserves the best. And you can’t get that unless you utilize business processes that work for you. Software is the top resource for “shortcuts” in our world today. When many of us encounter a problem or a task which is terribly time-consuming and manual, what’s the first thing we do? Find an app or software to fix that problem. Warehouse management software solutions can help with laborious warehouse processes such as putaway, inventory control, and cycle counting, whether you’re a 3PL or a DTC brand looking for a 3PL. Here we’ve included insight into the top 3PL WMS software available to enhance your business and how to maximize the benefits they offer. Enjoy!
What is 3PL in WMS?
As you likely know, 3PL stands for Third-Party Logistics. In the context of warehouse management systems (WMS), 3PL refers to a service provider that manages the storage and distribution of goods on behalf of a company. When it comes to WMS, a 3PL provider can use the software to manage their client’s inventory, track and trace goods and shipments, and optimize warehouse operations, inventory visibility, vendor support, and customer support for their clients. This can include receiving, storing, picking, packing, and shipping of goods, as well as providing real-time visibility into inventory levels and order status. The 3PL provider takes care of the physical handling of goods, while the WMS software helps them to manage the inventory, orders, and logistics operations, such as tracking and reporting.
What is 3PL WMS Software?
3PL WMS software is a comprehensive and sophisticated warehouse management system designed to streamline and optimize the operations of third-party logistics companies. It encompasses a wide range of functionalities, such as inventory management, order fulfillment, transportation management, and analytics, all aimed at increasing efficiency, reducing costs, and improving the overall performance of the warehouse.
Benefits of Third-Party Logistics Software
With its advanced features and intuitive interface, 3PL software empowers logistics providers to effectively manage their warehouse operations, from receiving and storing goods, to picking and shipping orders, to tracking and reporting on inventory levels. This technology is an essential tool for companies that rely on third-party logistics providers to manage their warehouse and supply chain operations, as it enables them to gain real-time visibility into their inventory, improve their operational efficiency, and enhance customer satisfaction.
How to Maximize the Benefits of 3PL WMS Software
Implementing 3PL software is just the first step in maximizing the benefits it can bring to your warehouse operations. To truly get the most out of your software, it’s essential to customize it to your specific needs. This means configuring the system to optimize it for your warehouse operations, such as automating repetitive tasks, creating custom reports, or integrating with other software. By customizing the software to your specific needs, you’ll increase efficiency and get the most out of the software.
Another key tactic to keep in mind is continuously monitoring and analyzing data. By regularly monitoring the system’s performance and analyzing the data it generates, you’ll identify areas for improvement and make adjustments as needed. Additionally, you can use the data to make informed decisions and optimize your operations. By doing this, you’ll keep your warehouse operations running smoothly and efficiently.
Much 3PL software also has mobile apps that allow you to access and manage your warehouse operations from anywhere, at any time. This can be especially useful for warehouse managers and supervisors who are always on the go. Utilizing this mobile capability can help you stay on top of your warehouse operations even when you’re away from the office.
Another benefit of 3PL software is the ability to plan and optimize your inventory. The software can provide real-time data and analytics, which will help you keep track of what products sell well and what products don’t. This will allow you to make informed decisions about what products to order and how much of each product to stock. By doing this, you can optimize your inventory and reduce the costs associated with overstocking or stockouts.
Finally, good 3PL software can also help you improve customer service. By providing real-time data on inventory levels and order fulfillment, you’ll provide accurate and up-to-date information to customers. This will allow you to resolve any issues quickly and improve customer satisfaction.
ShipHero’s WMS can do all this and more, check us out!
The Role of AI in 3PL WMS Software
Artificial intelligence can make warehouse work safer and more efficient. WMS for 3PL synthesizes vast amounts of data at every moment and can find the relevant answers to your employees’ and clients’ questions before they even think to ask. As soon as employees log into their dashboards on their mobile devices, they will see which items they need to pick for today’s orders and where they can find these items. With its streamlined integrations, the WMS instantly uses the input from the scanners every time an employee scans the item, so that it updates the inventory in real-time. Inventory management software can do its job much faster with the help of artificial intelligence, rather than if employees had to enter all the inventory data into Netsuite or Oracle manually. The real-time updates lead to cost savings and flexibility for 3PL providers and eCommerce enterprises alike.
Automation rules the day in many industries, including supply chain management (SCM) and fulfillment centers. Data collection, data interchange, and analytics help business owners make decisions about everything from warehouse workflows to retail pricing. The best WMS for 3PL providers, like the best freight broker software, will even make their own decisions if you authorize them to do this. For example, you can automate the reorder process to the extent that you let the WMS decide which stock levels should trigger a reorder of certain items.
Artificial intelligence algorithms are the modus operandi of search engines like Google. An AI algorithm in an order management WMS functions in a similar way, except that they are searching within the data set of your company’s warehouses or the supply chain of which your warehouse is a part, instead of the entire searchable internet. Of course, the more comprehensive WMS suites also have applications where they can analyze data from the World Wide Web. These algorithms can study market trends among brick-and-mortar stores and online retailers. These market trends can help with predictive forecasting.
AI analytics applications are very efficient at researching multiple trends that you would not think to research. While you are busy concentrating on what is going on within the walls of your warehouse, your WMS can research trends in weather and in the price of airline tickets. Therefore, it can accurately predict how much room you will need to make in your warehouse for cute swimsuit coverups (in a summer where travel is affordable and an area where temperatures are hot) or backyard “splash park” type sprinklers (where the weather is hot and when prices are high and the labor market is in the doldrums, so no one can afford to travel). It can even study which cooking videos are trending on YouTube in which areas so that it can guess where and when customers of the eCommerce companies that store products at your warehouse are going to start buying konjac noodles so that they can make low-carb fettuccine alfredo. Your warehouse will have exactly as many boxes of konjac fettuccine as it needs by the time you have even navigated to Wikipedia to find out that the konjac plant is also called the voodoo lily, devil’s tongue, and elephant yam, among other colorful names, and that you can, in fact, make noodles out of it.
How to Get Started with 3PL WMS Software
Whenever you start with new software you must define what you need the software to do for your business. That way, once you have identified software that fits your needs, you can set it up to improve your business processes based on the KPIs you need to see improvement from. This software is often used for automating repetitive tasks, creating custom reports, or integrating with other software. And don’t forget your team. Training your team on how to use the software is crucial to ensure the smooth implementation and operation of the system. Once implemented, monitoring and analyzing the data generated by the system will help you identify areas needing adjustment and a regular maintenance cycle will ensure continuous uptime.
Future Trends in Warehouse Management
According to the Start Us Insights website, warehouse management systems are one of the biggest trends in warehouse management in 2023. WMS ranks behind warehouse automation as the second most important warehouse management trend of the year. Other notable priorities this year are inventory tracking, wearables, the Internet of Things, immersive reality, warehouse security, sustainable warehousing, and fleet management.
WMS software is not new, and it is always evolving. Software developers are continuously analyzing the copious amounts of data they receive from warehouses that use their products and are always finding ways to make the WMS better serve the needs of the clients who use the software and of society at large. For example, if you have been using the same WMS for several years, you may find that its user interface is more intuitive than it was when you first implemented it several software upgrades ago. You might also find that it offers a greater variety of features and pricing plans.
Only the oldest warehouse employees remember what it was like when warehouses had to operate without computers, and employees had to keep a record of everything by using pen and paper. The older generation will also tell you what an adjustment it was when computers first came to warehouses. Today, mobile devices are ubiquitous in warehouses, so developing user-friendly and versatile mobile applications for warehouse management is a priority. Ensuring that WMS works with every iPhone, Android, or other mobile device is the key to successful warehouse management.
The partnership of analytics and automation is another trend that is helping 3PL providers operate more efficiently. The new versions of WMS keep track of where every person and every machine goes in the warehouse at every moment and how long each product stays on the shelves. Based on this, they can generate maps for how you can better arrange your warehouse and can guide you through the process of changing your warehouse layout, either just to improve efficiency or because you have signed a contract with a new client and need to make room in your warehouse to accommodate the new client’s stock. Analytics and automation can also help you ship products from the appropriate warehouses as quickly and inexpensively as possible. An algorithm can figure out whether, on a given day, the customer that just ordered the low-carb fettuccine will receive it more quickly if it arrives by plane from the Denver warehouse or by truck from the Atlanta warehouse.
Warehouses can only be profitable if the planet can support a human population. Therefore, environmental sustainability is as much a priority in 3PL as it is in other industries. Warehouses endeavor to reduce packaging and to use packaging materials made from biodegradable or recycled content when possible. They can also organize their operations so that all the trucks that leave the warehouse are full, instead of spending all that fuel to transport only half a truckload of freight. This may involve timing outgoing shipments strategically or partnering with other warehouses to share truck space.
What Features Should You Look For in a 3PL WMS Software?
When purchasing a 3PL WMS software, it’s essential to look for specific features which will enable you to optimize your warehouse operations and gain a competitive edge in the market. Here are a few lesser-known tips and tricks to keep in mind:
- Scalability: Look for a solution that can scale your business as it grows. This will ensure the system can handle an increase in volume and complexity without any disruptions.
- Automation: Automation is key to increasing efficiency and reducing errors. Look for a solution that offers automation capabilities for tasks such as inventory management, order fulfillment, and transportation management.
- Integration: The ability to integrate with other systems and software is crucial to achieving a seamless and efficient warehouse operation. Look for a solution that can integrate with your existing systems, such as your ERP or accounting software.
- Real-time data and analytics: Real-time data and analytics is crucial for making informed decisions. Look for a solution that offers real-time data and analytics capabilities, allowing you to monitor inventory levels, track orders, and gain insights into your operations.
- Mobile compatibility: With an increasing number of warehouse workers using mobile devices, look for a solution that is mobile-compatible, allowing you to access and manage your warehouse operations from anywhere, at any time.
- Cloud-based: Cloud-based systems are increasingly popular as they can be accessed from anywhere with an internet connection, which can be more cost-effective than on-premises solutions.
Customizability of 3PL WMS Software
Every warehouse operates in its own unique way. Therefore, it helps to be able to customize business software. If you have been working at the warehouse for a long time, you probably remember how cumbersome it was when you first started using QuickBooks to keep records at the warehouse. Over time, you were able to adapt and customize it so that it fits the needs of your company. The eCommerce companies that partner with your warehouse have probably had a similar experience with business software. They have probably customized their own shopping carts and other features to something that works for them.
If it were generic and not customizable, then WMS would offer little advantage over simply entering data manually into spreadsheets, except that it would be faster. One of the benefits of using WMS for 3PL, instead of just using generic business software, is that you can customize many of the features so that they accurately reflect your warehouse processes. For example, you can customize customer billing and order fulfillment features, since the details of these processes vary from one 3PL provider to another and one warehouse to another.
With WMS for 3PL, you can customize the analytics features so that the software asks the right questions about the data. Sometimes customization features of WMS for 3PL are called decision support tools. They let you enter “what if” scenarios and then predict outcomes based on the data. The more sophisticated decision support tools can even propose scenarios to analyze and predict.
WMS for 3PL also makes it easy for you to customize the workflows in your warehouse. Without customizable WMS, cycle counting is an endless and tedious process. With customizable WMS features, you can decide based on the data which counts you need to do and at what intervals to do them. You can automate cycle counting with your WMS. Even better, the software doesn’t miss a beat if you change the layout of your warehouse and then have to pick up where you left off with the counting process. Because everything integrates so smoothly with the warehouse employees’ mobile devices, nothing seems out of the ordinary to them, because the WMS adapts so smoothly to changes in your warehouse.
How Much Does a 3PL WMS Software Cost?
The cost of 3PL WMS software can vary widely depending on the vendor, features, functionalities, warehouse size, and number of users, and it can range from a few thousand dollars for a basic system to tens of thousands of dollars for a more advanced solution, you should also consider the ongoing costs such as maintenance, support, updates, and additional modules. Do your research, compare different options, consider the benefits the software will bring to your operations, and find the one which best fits your needs and budget, considering also that some vendors may offer lower upfront costs but have higher ongoing costs, while others may have a higher initial price but offer more features and support.
Best 3PL WMS Software
1. Shiphero
ShipHero’s WMS (Warehouse Management System) software streamlines and automates the process of managing warehouse operations with its advanced features and intuitive interface. You can easily track and manage inventory, fulfill orders, and optimize operations for maximum efficiency and productivity. Using ShipHero’s WMS software saves you time and money because you can customize ShipHero’s WMS software to meet the specific needs of your business whether managing a small stockroom or a large distribution center. The software also provides real-time visibility into inventory and operations, allowing you to quickly identify and address any issues that may arise. This avoids stockouts, reduces errors, and improves customer satisfaction.
2. WithoutWire
WithoutWire’s WMS software is a cloud-based solution that helps companies manage and optimize their warehouse operations. It offers a range of features such as inventory management, order fulfillment, and real-time tracking to help businesses increase efficiency and productivity in their warehouse operations. WithoutWire software has a focus on the fashion and apparel industry, offering specific features tailored to this market such as style and size matrix management, and pre-pack functionalities. They also utilize RFID tracking and automated warehouse robots to enhance their speed.
3. Logiwa WMS
Logiwa provides a range of features such as inventory management, order fulfillment, real-time tracking, and advanced reporting to help businesses increase efficiency and productivity in their warehouse operations. This software offers advanced features such as multi-client and multi-warehouse management, and integration with multiple sales channels and shipping carriers, which can help companies to streamline their order fulfillment operations, and manage more complex logistics operations. Additionally, Logiwa WMS also offers an advanced barcode scanning functionality and mobile device compatibility, which allows for real-time inventory tracking and warehouse operations management.
4. Synapse WMS
Synapse WMS provides a range of features such as inventory management, order fulfillment, real-time tracking, and advanced reporting to help businesses increase efficiency and productivity in their warehouse operations. Synapse software offers advanced features such as multi-channel integration, EDI integration, and RFID scanning, which can help companies to streamline their order fulfillment process, and manage more complex logistics operations. Synapse also offers a more robust analytics and reporting functionality, which can help businesses make data-driven decisions about their warehouse operations.
5. 2Ship
This company focuses on leveling the playing field within shipping. Their software will search all carrier rates so you can select the best service for the best price. It is a multi-carrier shipping platform built for eCommerce businesses that help business owners know their products will be shipped in good hands. Plus through their software, you can track shipping from any carrier and you have access to performance indicators to measure their efficiency. Please note, while this is not a WMS software, it is focused on relieving your stress when it comes to your shipments so it’s a worthwhile platform to consider.
What 3PL WMS Software Does Your Business Need
Choosing the right 3PL WMS software requires a strategic approach that involves defining your business objectives, researching different software options, considering scalability, and looking for automation capabilities and integration options. By taking the time to carefully evaluate different options and considering the key factors that are essential to your business, you can ensure that you select a 3PL WMS software that is tailored to your specific needs and will help you achieve desired outcomes such as increased efficiency, reducing costs, and improved performance of your warehouse.
Security Measures in 3PL WMS Software
Cybersecurity and data privacy are major concerns for business owners in many industries. We have all heard news stories about class action lawsuits against businesses that suffered data breaches, leading to data theft that resulted in financial harm to the company’s customers, vendors, or employees. The dangers of data theft are even more serious for companies that, in the course of their work, must store data belonging to many different individuals and businesses. Cybersecurity is important for all businesses, but it is especially important for eCommerce businesses and 3PL providers. To get a sense of how much you stand to lose from data breaches, think about the financial losses your company would suffer if a single item were stolen from your warehouse, and then think about what you would lose if a Social Security number or bank account number got stolen from your company’s devices. The theft of a piece of identifying information or financial data harms your company more than the theft of a pair of sunglasses or a lemon juicer. Now think about how many bank account numbers, credit card numbers, and pieces of identifying information such as Social Security numbers, birth dates, and passwords are stored in your system. Clearly, you have a lot to lose.
Businesses should review their cybersecurity policies periodically, sometimes with the help of cybersecurity consultants. Even though new computer viruses, and new protections against them, are developing all the time, some data security best practices remain consistent across time. For example, cloud-based software is more secure than storing sensitive data on the hard drives of your devices. If you use cloud-based business software, including cloud-based WMS for 3PLs, then your warehouse’s data is safe on the cloud even if hackers are able to breach your company’s devices.
Another way that 3PL providers can protect their data is to require employees to use strong passwords and to update them on a regular basis. For example, the WMS might require each employee to update his or her password after a certain number of logins or every 90 days, whichever happens sooner. It should only accept passwords that are strong. Characteristics of a strong password are that it has at least one capital letter, one lowercase letter, one number, and one special character. The password should be at least eight characters long, and it should not contain numbers in sequence, nor should it include words found in the dictionary. Some WMS for 3PL also have employees set up security questions, which the system prompts them to answer after entering their password. The WMS can propose a list of security questions from which employees can choose, such as, “What street did you live on in third grade?” or “What is your paternal grandmother’s name?” The purpose of these security questions is that the answers to them are unlikely to change (unlike “What is your favorite food?” or “How old is your youngest child?”), but other people are unlikely to be able to guess them or look them up (such as “What city were you born in?” or “When is your wedding anniversary?”).
Two-factor authentication is an increasingly prevalent feature in business software in general and in WMS for 3PL in particular. With two-factor authentication, an employee must confirm, through another device such as a mobile phone, that he or she is trying to sign into a company computer. The leading WMS for 3PL companies offers online support and phone support for questions about security matters relating to the software.
Key Takeaways
The WMS you choose for your company should not only fit your needs but also be easy to use. The goal here is to find software that gives you more power and time back in your day. While the initial setup of any software can be painful, the WMS you choose will likely have a consultant to help walk you through every step of the setup. If you want to speak to an eCommerce WMS expert, come chat with us at ShipHero!
3PL WMS Software FAQs
What is a Tier 1 WMS?
A Tier 1 WMS, or Warehouse Management System, is a type of software that is typically used by larger organizations or those with more complex warehouse operations. These systems tend to have a wide range of functionalities and capabilities and are typically more expensive than other types of WMS software. They are often used by companies that operate multiple warehouses, have a high volume of SKUs or require advanced features like RFID and real-time tracking. They also tend to integrate with other enterprise systems such as ERP, CRM and eCommerce platforms. Tier 1 WMS solutions are often provided by large, well-established software vendors, and are known for their robustness and scalability. They are designed for large companies with a significant investment in warehouse operations and logistics.
What are the Four Types of 3PL?
There are several different types of third-party logistics companies (3PL), but the four main types are:
- Traditional 3PL: These providers offer a wide range of logistics services, including transportation, warehousing, and distribution. They typically handle the entire logistics process from start to finish, taking on the role of a full logistics provider.
- Dedicated contract carriage: These providers focus on transportation services, such as trucking and rail, and manage a dedicated fleet of vehicles for a specific customer. They typically handle all aspects of transportation, including scheduling, routing, and compliance.
- Lead logistics provider: These providers act as a coordinator and managers of logistics services, working with multiple service providers to create a comprehensive logistics solution for a specific customer. They are typically responsible for managing the overall logistics process and coordinating with other service providers.
- Value-added logistics: These providers focus on providing specialized logistics services, such as packaging, assembly, kitting, and labeling. They typically handle only a specific aspect of the logistics process, but they add value to the overall logistics solution by providing specialized services that the customer may not have in-house.
It’s worth noting that some providers may offer a combination of these services and that the line between these categories can sometimes be blurred, depending on the specific 3PL provider and the services they offer.
What Are the Latest Trends in WMS?
The integration of artificial intelligence (AI) and robotics, IoT devices, and cloud technology is revolutionizing the warehouse management system (WMS) industry. AI and machine learning algorithms are used to optimize warehouse operations and provide real-time data and analytics. Robotics are used to automate tasks such as picking, packing, and transportation. And IoT devices allow for real-time monitoring and tracking of inventory and equipment, and cloud-based WMS allows warehouse managers to access their data and control their operations from anywhere at any time and also allows for easy scalability. These trends enable warehouse managers to optimize their operations, improve efficiency, and reduce costs.
