A third-party logistics (3PL) provider is a partner you outsource your shipping and fulfillment processes to. For retail startups, 3PL providers will pick, pack and ship your products to deliver to buyers or to brick-and-mortar stores. Shipping and logistics have become increasingly important processes in all businesses, including retail. As more people expect convenient product deliveries, your startup will need to meet consumer demand.
The Role of 3PL in Retail Startups
Retail startups have two core responsibilities: creating products to sell and delivering them to consumers. However, in the startup atmosphere, creating products is priority number one, making 3PL providers ideal partners in keeping startup retailers afloat.
As new retailers build their audiences, new products help to establish the brand and keep buyers interested. The process behind product development is intensive. Startups need to design products, source materials, find manufacturers for the products and grow stock to sell. With a 3PL, outsourced providers handle all of the steps that go into shipping, freeing up the resources to focus on production.
For many startups — retail or otherwise — teams are often very small, and each person has to juggle multiple responsibilities. While every employee could have a role in product development, there are also other processes to consider, like marketing and bookkeeping, that help the business grow. Adding logistics responsibilities to this long list can overstretch a small team and ultimately limit mobility.
Working with a 3PL gives your retail startup the space to scale and grow. Allow a partner, like Crown LSP Group, to handle fulfillment while your team focuses on the processes that bring in new buyers.
Advantages of 3PL for Startups
Choosing a 3PL partner offers plenty of advantages to your retail startup.
Cost-Effectiveness
In-house supply chain management is no easy feat, even for large businesses with plenty of resources. Retail startups that are still finding their footing often lack the financial resources to add a single supply chain expert to their team, let alone a whole department. Internal supply chain processes require warehousing resources as well.
While outsourcing might feel like an extra expense, it’s still a much more effective use of your startup’s funds. Plus, a focused supply chain organization can reduce challenges in inventory management and prevent time-consuming customer service needs that your team might not have the time for.
Streamlined Processes
With so many processes to pay attention to at a retail startup, your shipping tasks are prone to being disorganized. Add this to a lack of resources, and your fulfillment procedures become inefficient. A 3PL focuses on shipping and logistics alone. These companies have the experience to manage fulfillment with ease and efficiency, so you can meet every order request.
Today, online shopping is the main way people shop, and many of them will expect orders on their doorstep within a week. If you’re a retail startup with an online store or a store that exists solely online, you need to meet these modern demands. A 3PL has the focused processes to help you achieve that.
Adaptability and Scalability
A 3PL provider is prepared to adapt to your needs and scale with your business. These providers offer extensive resources in the world of fulfillment and logistics, giving them the ability to adjust their services for your startup as you need them. While this is valuable for your retail startup as it grows quickly, it’s also helpful for slower periods when you may need less support based on consumer behaviors.
This adaptability means your team can rely on the same provider throughout the life of your business. You don’t have to abandon your partnership when your needs shift because a 3PL is ready to respond to these changes.
Specialized Knowledge
In the world of shipping and logistics, there are various concepts you need to understand to effectively manage the flow of orders and meet fulfillment requirements. Between planning and coordinating shipments, organizing a warehouse and tracking goods through labeling, fulfillment can be challenging to manage.
With a 3PL, you’re partnered with a team of experts who understand what it takes to handle all of these processes. Rather than having to learn these concepts yourself, you can count on specialists with years of experience in the field. This expertise also means your 3PL partner can handle these processes efficiently.
Network Access
A 3PL company typically has multiple warehouses and may even have a nationwide network your startup can rely on. This network access greatly benefits your growing business because it allows you to reach more buyers in less time.
With modern buyers expecting fast shipping times, this network access allows you to meet consumer demand. A wider reach also allows you to capture a larger audience in the early stages of your startup.
Advanced Technology
Technology is a major player in logistics and fulfillment as well. If you choose to handle fulfillment internally, these technologies might not be available to you. A 3PL expertly leverages shipping technologies to improve efficiency and accuracy in the fulfillment process. Possible technologies used by 3PLs include:
- Warehouse management system (WMS).
- Automated fulfillment technologies, like barcode scanners and conveyors.
- Inventory management system (IMS).
- E-commerce integrations.
These technologies pair with a 3PL’s specialized knowledge to create a well-oiled machine. Your 3PL partner will seamlessly receive an order, retrieve the item from the warehouse and ship it out.
Selecting a 3PL Provider
With all the benefits of outsourcing logistics to a 3PL provider, your next step is to find one. Since these providers are essential partners in the success of your business, you need to choose one wisely. Consider the following factors when selecting a 3PL.
Customization
An ideal 3PL is able to customize all of your shipping items to reflect your brand. If you have specific packaging, labels and packing slips, your 3PL should use all of these custom items in your fulfillment processes. This customization is how a 3PL becomes a true extension of your team, not a removed third party.
When you’re searching for a 3PL provider, questions about customization should be at the forefront of your exploration. It’s in your best interest to work with a provider that tailors services to your unique needs, making your 3PL an excellent invisible extension of your retail startup.
Customer Service
To build a trustworthy relationship with your 3PL, you need a provider that’s committed to excellent customer service with your startup. Customer service is valuable for building trust with any outsourced provider. In the case of a 3PL, you need confirmation that your provider is invested in excellence and quality, as it will reflect back on your growing business.
In logistics and fulfillment, customer service is also important for keeping you informed. Details about elements like estimated delivery times and cost optimization can streamline logistics and give you confidence that processes are running smoothly.
Responsiveness
Logistics needs can change in an instant. Between canceled orders, recalls, returns and supply chain disruptions, you need a 3PL that’s ready to act in the face of these unexpected changes. When looking into a 3PL, you can ask about their processes regarding supply chain issues and sudden changes in order volume or destination.
For example, at Crown LSP Group, our team uses a series of technologies to maintain transparency in the shipping process. While this transparency is valuable for communication with your brand, it also allows us to see potential bottlenecks in the process and respond to them immediately.
Flexibility
A 3PL that can grow with you is one of the major benefits of outsourcing fulfillment. When selecting a 3PL provider, make sure they have the resources and flexible services to adapt to your changing requirements. It’s helpful to look out for value-add services. These solutions can be introduced to standard warehousing and logistics processes based on what your company needs.
Crown LSP Group offers a range of value-add services, including:
- Reverse logistics
- Cross docking
- Transloading
- E-commerce fulfillment
- Inventory management
- Kitting and assembly
Services like these illustrate a 3PL’s capabilities and their ability to adapt to your retail startup as the business grows.
Reputation
When a 3PL has a good reputation, you can feel certain they deliver on their promises. Choose a provider that is well-established and may even come highly recommended by other businesses. Looking into customer reviews online can give you a good idea of a provider’s reputation before you work with them.
Another way to tell if a business is well-established is by looking at its list of services. A highly experienced 3PL will have a wide range of solutions and will often highlight a turnkey approach in the process.
Explore 3PL Solutions From Crown LSP Group
Retail startups need a trustworthy logistics partner to keep their consumers satisfied and align with modern expectations. While you can attempt to manage these processes in-house, you can gain more from a focused expert. As a startup, growth is a top priority, and an experienced logistics team can help you achieve that growth.
Crown LSP Group is a distribution solutions company that can help your retail startup thrive. Get started with us today and request a quote.
