If you’re in third-party logistics (3PL) fulfillment these days, no doubt you’re busy. Crazy busy, in fact. We can feel the pulse rising in your industry, as inquiries have been pouring in lately for a 3rd party logistics warehouse solution — or 3PL WMS — that’s specifically built to help simplify supply chain.
When 3PL companies first approach us, we usually hear a great deal of anxiety and confusion: “Do we really need a dedicated 3PL warehouse management system? Or can we get by with inventory fulfillment in an ERP or a homegrown WMS?”
Sometimes it’s, “We need a dedicated 3PL logistics solution, but the timing just isn’t right”. (Tisk-tisk)…
Considering the huge labor problem facing every warehouse, a specialized 3rd party logistics warehouse solution is an area well worth funding sooner rather than later.
The long-term benefits of a dedicated 3rd solution are crucial to maintaining profit growth in volume-heavy, unfamiliar spaces like Direct–to–Consumer (DTC).
What good 3PL warehouses look like
Being a 3PL leader means having a warehouse that can quarterback and support your clients’ growth journey, whether the client is a mom-and-pop shop or a global omnichannel leader.
It means setting them up with new services and new ways of selling without impacting your margins. Whether it’s through DTC, marketplaces, B2B channels like Amazon, Shopify, Walmart, or anything they need. Seamlessly. Optimally. Stress-free.
There are easy ways to make this happen, but if your business is still using legacy (or disparate) 3rd party logistics warehouse solutions instead of best-in-breed warehouse management software that offers speed/transparency — growth will be extremely difficult.
Consolidating multiple systems into one modern 3PL logistics solution that can handle everything in one platform, including billing capture, creates fast value and competitive advantages:
- Fulfill very high volumes without growing your staff
- Automate time-consuming customer service workflows
- Meet increasingly sophisticated client requirements for less
- Onboard new clients in just minutes
- Ship orders fast, with a <1% error rate consistently
- Keep systems adaptive to constantly shifting goalposts
Value of 3rd party logistics warehouse solutions – ITB ’s story
3rd party logistics solutions are how high-growth logistics firms are maturing their inventory operations for rapid ROI. Just watch this example with ITB Fulfillment.
In under 8 weeks, Deposco implemented a fully automated, cloud-based WMS for 3PL that uses barcodes and handhelds on the floor. The software streamlines bulk order processing from dock to receipt, with unmatched accuracy. ITB’s team can see in advance what’s coming in for every SKU order, along with a customer printout of all packing slips and shipping labels. Now, thousands of orders can ship with just a few people.
Client orders automatically sync into the 3PL WMS using one of Deposco’s 100+ pre-built software integrations (Shopify, in this case). ITB now has a plethora of direct sockets readily available as they scale, plus expert help with any rules-based customizations needed.
In October 2019, ITB shipped 10K packages. By December 2020, they shipped 90K packages. So in just over a year with Deposco, they were fulfilling 9x more orders without hiring 9x more people.
In addition, ITB is reporting an error rate of less than 1%. Being able to deliver this level of client confidence, and ship this much more without tripling their staff is a huge win for ITB and their clients.
Has your 3PL outgrown its logistics solution?
Whether your business has 10 clients or 1,000, you should be evaluating the impact of your 3rd party logistics warehouse solution to see if it is helping you grow:
Does the logistics solution require a lot of paper?
Omnichannel is growing too fast to rely on manual or paper-based processes. Modern 3rd party logistics warehouse solutions eliminate the risk associated with manual inventory management methods, which will never catch up to the speed of orders coming in.
Introducing real-time inventory availability, syncing, order updates, and 3PL automation will free your warehouse team from backlogs, manual catch-up work, missed shipments, and errors that kill deals.
A third-party logistics warehouse solution like Deposco easily connects to the software suites you already use, including your ERP. This tremendously speeds up KPIs like hourly picking rates and daily shipments, while ensuring your teams have access to crucial information that’s up to date at any moment.
Is it reliable?
As we saw this week, large product suites have a lot of moving parts and go down frequently, often with detrimental effects on the business and the staff. System stability is non-negotiable for high-powered 3PL businesses that don’t want to worry about outages paralyzing their operations at the very worst times.
Deposco is pleased to report 100% system uptime for our customers during their busiest time of the year.
Related Guide: Inventory Fulfillment in ERP: When to Buy a WMS
Does it provide quick onboarding?
How long does it take to set up a new client or service offering? Do you have custom requests that must be managed through an exception process? With the speed of client orders coming in, nobody has time for that.
Onboarding more clients into your 3rd party logistics warehouse solution requires a new degree of speed and automation. Look for a user-friendly interface that greatly shortens this process, along with getting new employees trained on the software in less than an hour.
Does it automate billing tasks?
Modern third-party logistics warehouse solutions automatically plug into your client billing systems to alleviate much time spent on the phone or emailing in search of answers.
Billing becomes part of your 3PL fulfillment platform, enabling you to stop costly errors, slash the billing cycle, and get paid for services you’re currently giving away for free – simply because you lacked the full picture. This also makes better use of your staff, which as you know is a challenge in and of itself.
Do you have the flexibility to offer value-added services?
When evaluating a 3rd party logistics solution, carefully examine its configurability to incorporate processes and value-added services.
For example, client-specific UCC128-compliant labeling requirements can be tucked into the outbound order fulfillment process and added to your normal menu of client options to pump your revenue stream.
Can the solution help you and your clients save on shipping?
With the high value placed on free shipping for retailers and customers alike, a specialized 3rd party logistics warehouse solution can be a significant component of your cost-reduction strategy and value offering.
Deposco offers 3PLs a built-in WMS and shipping platform with rate shopping that supports fulfillment times in <24 hours and big savings on shipping. The system offers native WMS capabilities for multi-carrier rate shopping, integrated directly with parcel and local carriers.
This allows your warehouse employees to automatically shop shipping rates, generate labels, connect to billing, and provide full tracking and documentation in real time.
Deposco’s 3rd party logistics solution can easily calculate box dimensions and show packers which box size to use. It also makes it easy to consolidate multiple orders going to the same destination to potentially ship all goods in one box — while providing support for kitting, work order management, EDI integration, and custom label/packing slip generation by customer and trading partner.