Have you heard the latest? ShipHero’s Warehouse Management Software has enhanced its cycle count feature. You can now set counts by your schedule, assign users, flag for recounts and choose to count by location or SKU – whatever works best for your brand! We’re so excited to offer this enhanced functionality and give our clients the flexibility and control they need to keep their inventory counts accurate and up-to-date.
How does a 3PL navigate managing shipping accounts for themselves and their clients? In this video, ShipHero’s founder + CEO, Aaron Rubin, discusses the economics behind a 3PL and why it’s important to know when to use your own shipping account or your clients.
Find out how everyone wins with our Economics of a 3PL video. Included are tips for running a profitable 3PL and making sure you and your clients both come out on top when using national and local carrier rates.
A 3PL, it’s a blue collar business. Your goal is a dollar per order profit, that’s basically best in class. Your other goal is to not lose money or run out of money, which is really easy to do at a 3PL. It happens one of two ways, mostly related to using your shipping accounts. If you’re using your shipping account and a merchant doesn’t pay you,
UPS and FedEx still expect you to pay them and then you get squeezed, right? You don’t have the money to pay. If you’re using your should be account, not your client’s shipping account, you are responsible for the bill. So you need to make sure you’re only doing that if you know that your merchant is going to A, pay you and B, pay you on time.
Because UPS or FedEx will expect to be paid in, say, 21 days. If your merchant is on 30 day terms, you’re already behind. And then if they pay you late, you now get cash crunched for nothing you did wrong. So make sure that you’ve got the right terms or you’re using your client’s shipping account, which will protect you.
The other reason to use your client’s shipping account sometimes is if you’re not going to mark up your shipping, you have no profit margin in there, which means any mistake that happens, you have no buffer to take that out of. So if you make a mistake or even if you don’t, but UPS charges you for something extra. If you are using your account, your client might not want to pay you for that.
But UPS is going to expect you to pay and you’re going to end up losing money on that. So you need to make sure if you’re using your account, you’re marking it up. So then if you mark it up 10%, there’s the occasional mistake. You have the buffer to to offset that, or it’s the client’s shipping account and then it’s their responsibility.
So if there’s a mistake, let them fight directly with UPS or FedEx. It’s not your cash that you need to watch out for. 3PLs in general should be a fairly profitable small to midsize business. If using our ShipHero software, you can bill the client for using your account or you can plug in their account and you can also do it differently per client.
So let’s say you’ve got, you know [brand] as a client, their shipping rates are probably better than yours, so you might plug in theirs. And then if you’ve got a really small merchant, they probably don’t have access to as good UPS rates as yours. So maybe you plug in yours, maybe you have a bit of a markup on there.
So they’re still getting a better rate than they would get on their own. And now you’ve got a bit of a profit center by leveraging the volume you have with the carrier to get better rates. So that’s how everyone sort of wins.
Do you know the 3 key factors to setting up an optimized packing station? Discover the best way to set up pack stations in your warehouse and how it can help improve your team’s efficiency!
Hello. I’m Aaron Rubin, the CEO of ShipHero. I’m at one of our facilities. I want to show you a typical way to set up your packing station and what that process should look like. So your objectives are, first of all, you want to minimize touches, so you want to touch everything once. You never want to go backwards, so you want a flow that always moves in one direction. It never requires you to change directions. You want to not use your keyboard and definitely not use your mouse. So those things will all go slow. So, I’ll show you how we do it at ShipHero but those are the basic principles to build your own flow. So we start with totes. Totes have barcodes. You scan the barcode which pulls up the order.
You then scan the items, you put them on the scale. You then choose your correct packaging material. These buttons actually tell our system which was selected, put the items in the packaging material. If it’s a box, we use this to get the wet tape, seal the package. The invoice is printed by pressing this button here so we don’t use a keyboard, we don’t use a mouse.
We just use this big button that says invoice and label that prints a label from here. You slap that label on. You typically throw it on a conveyor here. The way this is set up, we’ve got these bins at the station, so you throw it in the bin. If you need void fill that’s available right here. There’s a foot pedal, so you’re completely hands free and you’ll notice the flow goes uninterrupted from grabbing the tote until here.
When you’re done packing it, you’re done with the order. The tote goes back, you grab the next one, repeat the process. That’s it. That’s the simple philosophy when you’re designing your pack stations: one touch, keep one direction throughout the flow, don’t move backwards, don’t use the keyboard, don’t use your mouse. Just keep those points in mind.
VareYa Tripled Their Business With ShipHero.
Located in the Netherlands, VareYa began providing 3PL services for B2B companies across Europe, Asia and the UK in 2008. With just 30 full-time employees, and looking to switch to a B2C business in 2016, VareYa knew that their current, disorganized warehouse management solution wouldn’t allow them the growth they wanted. All of these non-integrated systems led to a ton of paperwork, a ton of mistakes and a ton of headaches.
Enter ShipHero. With its fully end-to-end Warehouse Management Software solution, ShipHero was able to migrate all of VareYa’s systems to an all-in-one platform. Instead of using a variety of different software, VareYa could now just look to ShipHero to run its warehouses.
ShipHero was a lifesaver. It was three years ago that we decided to find a new system. So, I had a list of requirements and it was like, check, check, check, check. And the support was very great from the beginning. When we onboard the client, the connecting with the store is like plug and play. Even the client can do it in like 5 minutes and before it took days to get connected.
You can just create the automation rule very easy. It’s very user friendly. Everything that we needed was integrated. So it was like a system that was built for us. Since we used ShipHero, we tripled. So all our clients love it because they are able to to have an account and they can also create all their accounts for their for their teams.
And that is something they really like. And I know for sure that for a lot of clients, it was the reason to start doing business with us. What’s helped us a lot is that we have the reports in ShipHero and we communicate these reports to our clients and they really appreciate it. I know for sure that that ShipHero has helped us a lot to grow.
I’m really happy with the support every day. It’s really positive. Also, if we need new features, they put it on the feature list. Actually, I don’t have any negative points.
Follow Aaron through our PA warehouse as he explains what replenishment is and the tools you need to do it better and faster.
Hello, I’m Aaron Rubin, CEO of ShipHero. I’m at one of our owned facilities and I want to explain what replenishment is and what your typical process will be of doing it. So if you look out here, you’ll see a typical picking area where you have lots of small boxes, each of which have different products, which is the ideal way to pick.
But if you look on this side. You’ll see we have pallets which have many, many boxes of the exact same product. Now, why don’t you just pick from a pallet? And it’s like if you replace each of those little boxes with the pallet it originally came on. There would not be enough room in the warehouse and you would also end up walking for mile because would just take up so much more space.
So when stock comes in, oftentimes you get a pallet worth of the goods, you need to store that pallet. But then you only want to be able to pick out of a single box of it.
So replenishment is the process of moving one or a few boxes out of a pallet and putting it into the pickable area.
If you have a really fast mover where you’re picking from the pallet, you still end up replenishing because what often happens is…With a SKU, with that velocity, you have a full container of a SKU. So, you’ll have 24 pallets, let’s say, of the single SKU. So you still need to keep most of it up in the air and on racks. And then one pallet at a time to be pickable. So you replenish that.
So, in our software it tells you what products need to be replenished. So, I’m not going to go into too much detail on that, but I’ll show you the physical process of how we do it.
When you’re replenishing from your pallet positions, if it’s on the floor loaded position.
It’s pretty easy to just grab a box. If it’s higher up, you can do things like a rolling ladder, but typically what you’re doing is you’re grabbing a forklift, pulling down a full pallet, taking out the box or two that you need.
Then, putting the pallet back up into that original position.
An ePicker makes it a lot easier where you can go up, remove the box or two that you need, drive it to where it needs to go without having to pull the full pallet down and put it back.
So, it’ll take about half the time. And ePickers are generally cheaper and easier to operate than a forklift. So if you have the need to do a lot of replenishment, making an investment in an ePicker will often be a smart idea.
Click below to either login to your ShipHero Software account or your ShipHero Fulfillment account.
And welcome back
