You've been running your e-commerce business for a few years now. Sales are growing steadily but managing your own fulfillment and shipping is starting to become a real hassle. You know you need some help but aren't sure if you should look for a 3PL tailored to mid-sized companies or smaller operations. The stakes feel high because choosing the right logistics partner could take your business to the next level. But choosing poorly could create a costly mess. This article will walk you through the key factors to consider so you can determine what type of 3PL customer you are. With the right insight, you'll be ready to find a provider that's the perfect fit. Now let's dive in and figure out whether you need a mid-sized or small 3PL!
If you're running an e-commerce business and trying to figure out if you should work with a 3PL (third-party logistics provider), there are a few key factors to consider:
Order volume. Are you shipping less than 100 orders per day on average? If so, you likely fall into the "small customer" category for a 3PL. Once you surpass 200+ daily orders, you're entering mid-size territory.
Storage needs. Do you have 5,000 square feet or less of warehouse space? For a 3PL focused on small/medium businesses, that's their sweet spot. If your inventory takes up a 50,000+ square foot facility, you may need a bigger 3PL suited for enterprise-level clients.
Delivery footprint. Are you shipping mostly to consumers within a single country? Smaller 3PLs specialize in domestic delivery, while mid-size and larger providers offer global logistics services.
Peak season. If your sales spike 300%+ during the holidays or other peak times, then you'll benefit from a 3PL's ability to scale up/down as needed. Large 3PLs have vast networks to manage huge volume surges.
Service requirements. Do you just need basic warehousing and shipping? Or are value-added services like kitting, labeling, and customer returns handling important? Smaller 3PLs focus on core fulfillment, while mid-size and up provide expanded offerings.
Looking at these key criteria will help you determine if you're a small, medium, or large-scale shipper when selecting a 3PL partner to meet your specific e-commerce fulfillment and logistics needs. We aim to provide top-tier service no matter the size of your operations.
So you think you've outgrown being a small fry in the logistics pond, but you're not quite a whale yet either. How do you know if you fall into that mid-sized category when it comes to third-party logistics? Let's break it down.
First, take a look at your annual shipping spend. Mid-sized customers typically have between $1 million and $25 million in annual logistics costs. If your spend falls in that range, you're likely a mid-sized fish.
Next, examine your shipment volumes. Mid-sized customers ship around 5,000-15,000 orders per month on average. Compare your monthly volumes to see if you align.
Check how many distribution centers and fulfillment locations you utilize. More than one but less than 10 is common for mid-sized e-comm companies using a 3PL.
Finally, consider the variety and complexity of your logistics services needs. Mid-sized players often require value-added services beyond just freight brokerage. We're talking kitting, FBA prep, retail compliance, etc.
If your shipping spend, volumes, locations, and services needs fit the mid-sized profile, then it's safe to say you've graduated from being a small fry! That means it's time to find a 3PL like us that offers the right mix of competitive pricing, value-added services, technology, and high-touch support for customers your size. We'd love to show you what we can do for mid-sized e-comm brands like yours. Let's talk!
So you're trying to figure out if your e-commerce business is a small or mid-sized 3PL customer. Here's a quick guide to help you determine where you fall.
Order Volume - Small customers typically ship less than 150 orders per day on average. Mid-sized customers ship 150-500 orders daily.
Peak Volume - During peak seasons like holidays, small customers may ship up to 300 orders a day. Mid-sized customers can ship 500-2,000 orders on peak days.
Revenue - Small customers generally have under $5 million in annual revenue. Mid-sized customers make $5-20 million.
Fulfillment Options - Smaller customers usually use one fulfillment center. Mid-sized customers often use multiple fulfillment centers or mix 3PL and in-house fulfillment.
Technology Needs - Smaller customers have basic tech needs like shipping software integration. Mid-sized have more complex tech needs like custom API integration.
Account Management - Smaller customers get an account rep. Mid-sized get dedicated account teams.
Growth Trajectory - Smaller customers have steady organic growth. Mid-sized have rapid growth goals.
The key is looking at your current state and your goals for the next 12-18 months. If your growth plans will push you into mid-sized territory soon, you may want to partner with a 3PL suited for mid-sized clients now. That will ensure you get the right solutions and support as your business scales quickly.
As a small or mid-sized e-commerce business owner, you can expect personalized service and attention from your 3PL logistics provider. Though you may not have the shipment volume of larger companies, you are an important customer nonetheless. Here's what you can anticipate:
Dedicated Account Manager. Your main point of contact will learn the ins and outs of your business and be available to answer questions and address any issues that arise. Don't hesitate to reach out!
Flexible Solutions. Your 3PL will assess your unique needs and design a logistics program tailored to your business model, whether FBA prep, direct-to-consumer order fulfillment, or a hybrid approach. As you grow, they can scale alongside you.
Competitive Pricing. Look for ways to keep costs down, like warehouse selection and consolidation opportunities. Negotiate for the best rates thanks to the 3PL's shipping volume discounts.
Tech Integration. Your 3PL should integrate with your e-commerce platform, providing inventory visibility, tracking info, and more. APIs and EDI allow seamless data exchange.
Personal Touch. Though systems are automated for efficiency, you'll work with real people who genuinely want to see your e-commerce business thrive. You're more than just a number.
The right 3PL values their small and mid-sized customers. Leverage their expertise so you can focus on sales and marketing while they handle logistics. Together, you'll find solutions that meet your needs and budget.
At our logistics company, we work with all types and sizes of e-commerce businesses. But when it comes to 3PL solutions, it helps to understand whether you are more of a mid-sized or small customer.
If you ship 5,000+ orders per month, you are likely a mid-sized 3PL customer. For you, we focus on expanding automation to drive efficiency, fine-tuning delivery speed, and providing visibility into your entire supply chain.
Smaller e-commerce businesses that ship less than 5,000 orders per month make up our small 3PL customers. For you, we concentrate on the basics - accurate order processing, competitive shipping rates, and proactive communication.
No matter the size, we aim to understand each client's unique needs in order to deliver customized, scalable logistics services. Reach out if you need help determining the right 3PL solutions and technology integrations for your e-commerce operations and growth plans. We're here to provide the logistics support that allows you to focus on sales.