What is a 3PL? Third-Party Logistics Definition, Process & Resources

What is a 3PL and will your business benefit from it?

What are 3PLS and what the benefits behind them? These are very good questions. The traditional business model of executing numerous or all operations in-house isn’t always the most efficient. For example, if you’re running a small eCommerce business, this is especially true. Many eCommerce firms have been able to develop their operations while keeping operating costs low. Hire a third-party courier service to take your items from point A (your warehouse) When you apply marketing automation to a B2B sales organization, for example, the goal is to get products (customers) from point A (your business). This allows you to concentrate on marketing, growth, and customer satisfaction.

A third-party logistics firm can keep your inventory for you. It will pick, pack, and ship your items. 3PL is the key link between your production operations and your clients. When you have a good 3PL, you will enjoy a better customer experience, and your company will thrive. Excellent customer service is critical for eCommerce businesses to succeed.

It’s crucial to grasp what 3PL means before you begin dealing with a third-party logistics firm. This article discusses how to connect third-party logistics with your operations and the best 3PL partner. If you already know what you’re searching for, have a look at our 3PL services.

What is a 3PL or third-party logistics?

The distinction between third-party logistics (3PL) and fulfillment warehouse or center is sometimes blurred. Many of the same services as order fulfillment firms are available through 3PL providers. These services include:

  • Warehousing
  • Inventory management
  • Shipping and receiving
  • FTL and LTL freight shipping
  • Picking and packing
  • Kitting and customization
  • Reverse logistics (returns)

An eCommerce fulfillment company is a third-party logistics provider. It offers all of the logistics services you’ll need to outsource your operations.

Different 3PL solutions businesses specialize in various categories of fulfillment and storage. Some are suited for chilly fulfillment. Food goods that must be refrigerated or frozen can be stored and sent in these warehouses. Other 3PL firms are prepared to store and ship dangerous goods. Red Stag Fulfillment is one of the world’s leading third-party logistics services for large, bulky, and high-value items.

What is a 3PL?

The term 3PL is a reference to the fact that it relates to logistics, which was previously discussed. The term third-party logistics refers to the coordination of activities between companies and customers or suppliers (third parties). It’s also known as order fulfillment in some cases. A third-party warehouse offers a comprehensive set of eCommerce fulfillment services. Warehousing, order processing, and shipping and receiving are just a few of the activities that may be completed. Other 3PL process warehouses provide a variety of services. Customer care, returns processing, and customization are just a few examples.

The 3PL model is the most widespread form of outsourced logistics firm. Other variants include 4PL and 5PL, but the vast majority of businesses big and little are interested in 3PL.

What is a 3PL used for?

Third-party logistics companies handle both inbound and outbound transportation for clients, as well as storage. Many 3PL firms rent warehouse space to their customers. They don’t usually have their own truck fleet, but they do contract with other carriers for freight and delivery.

Third-party implies that you’re contracting out the fulfillment of your purchase. You don’t have control over the warehouse. Instead, you hire shelf space in a large warehouse to store the goods for many businesses. Warehouse workers pick up your items and put them into inventory. They fill orders from shelves and safely pack them for shipment. The 3PL collaborates with a variety of carriers to deliver your goods to your clients.

Third-party logistics warehouses are built to increase efficiency and speed. As your business expands, they can handle the extra volume, allowing you to expand your capacity without employing additional personnel. A 3PL may assist you in lowering your shipping expenses and delivery times by providing suggestions. You’ll get the benefit of expertise and concentration when you work with a 3PL firm for eCommerce fulfillment.