Today it is a consumer-driven world. It is no longer a bulk shipping to retailer supply chain, centered on products. Today’s consumer wants to be able to order from anywhere, have access to a bevy of delivery options and get goods in their hands in hours or days.

What is an online retailer to do?

One way to meet these complicated challenges is to outsource to a third party logistics provider (3PL). 3PLs provide specialized resources and expertise and are positioned to provide expertise and cost savings.

Ability to Meet Consumer Demand

Moving goods across the supply chain and positioning them within immediate shipping distance of consumers can be a tricky business.  So many supply chains are global these days.  This provides new levels of complexity when dealing with regulatory issues, supply chain disruptions and moving goods through customs.  These challenges typically require employing global supply chain experts on issues related to transportation and logistics, international law and trade regulations, a costly investment to be sure.

Relying on a 3PL enables an online retailer to invest in growing their business rather than managing a supply chain.  Third party logistics providers with global operations and expertise have already made those critical investments and have the experience necessary to solve the most costly, vexing problems on behalf of their customers.  They are able to combine freight, handle the necessary documentation, meet storage requirements and provide data for tracking.

Why is this important?  Because the time it takes to get goods to move along the supply chain to the point where last mile logistics can be engaged to reach consumers is absolutely critical. 

Food and other sensitive products can spoil and become worthless.  Fashion changes quickly and trendy goods can lose their value.  Using a 3PL can help online retailers to move goods from the point of manufacture to consumer consumption expeditiously, preserving their value so that the customer experience (CX) is rated highly.

Having multiple warehouse facilities in key locations is critical to ensuring fast shipping to consumers.  Today e-commerce retailers are struggling to meet consumer demands for fast free shipping.  Between rising transportation and shipping costs, labor challenges, location of consumers and type of goods, last mile delivery is an ever-present challenge for all concerned.  For online retailers, being able to meet these complicated logistics challenges of fulfillment and delivery provides them with a competitive advantage.

How are they accomplishing these objectives?  By using 3PLs.  Today’s 3PL is not the pallet shipping Mom and Pop operation of 20 years ago.  Third party logistics providers are much more sophisticated, invest in centrally located warehouse locations and trained labor and utilize cutting edge technologies including warehouse management software specifically for 3PLs.

Many 3PLs now offer last mile delivery options including white glove services.  White glove delivery services are often used in the home furnishings industry and can include receiving, packing, crating, specialized storage and transportation.  White glove last mile delivery service can also include assembly and set up, making it easy for consumers to have their purchases ready and waiting for them to enjoy without additional labor on the part of the consumer.

Seamless Omnichannel Shopping Experience for Consumers

Relying on a third party logistics provider can help to ensure a consistent customer experience across all devices and channels, critical to great CX.  A top-notch customer experience can only be had when customers have the same experience consistently whether they are shopping online, via phone or in a store.

This extends through the order processing and delivery.  Most 3PLs have order management capabilities so that they can optimize inventory to enable fulfillment from multiple sources including retail stores, distribution centers and others.  This facilitates customer-friendly service options including the ability to buy online and pick up in store.

Dealing with a 3PL has other advantages.  Your business will be able to reap the benefits of their years of experience servicing a range of clients, often with different types of inventory, clients and processes.  This can be very helpful when your business needs innovative solutions.  3PLs that are experienced in fulfillment can offer new ideas as well as industry best practices to help solve your critical business challenges.

Real Time Accurate Inventory, Order and Shipment Information Visibility

Few things are more frustrating to today’s consumers than encountering inaccurate information about products and inventory quantities when shopping online.  Picture this.  You are sitting at home, tablet in hand when you see a commercial on tv and decide to purchase the product online.  After shopping online and placing an order, you venture out to visit the retail store and retrieve your item only to be informed that the store is out of your particular item.  How frustrating!

Because 3PLs tend to rely on leading edge technology, they can typically provide ordering systems that provide real time inventory visibility, backorder receipt dates, purchase verification and much more.  This helps to expedite the order fulfillment process, ensuring that it is as accurate as it is speedy.

3PL technology investments usually include integrations with other business critical systems including financial and accounting systems, ERPs and TMS and make excellent use of EDI for streamlined communications.  These can be critical but costly investments in ensuring a streamlined order process and flawless execution of order fulfillment, essential to customer satisfaction rates.

Fast, Accurate Shipping and Delivery to Consumers

With their wide array of customers, 3PLs tend to have extensive experience and resources devoted to shipping, handling freight and often last mile delivery.  In other words, they are expertly positioned to help you get your goods into the hands of consumers on time and within budget.

Third party logistics providers typically have invested in shipping management technology solutions, transportation management systems and can offer impressive discounts from numerous shipping carriers.  Having a partner with effective shipping practices can provide an e-commerce retailer with a major competitive advantage. Using a TMS and routing software in combination with an established delivery network with nationwide reach can make sure that consumers have a positive delivery experience.  This is of high value to the overall customer experience.

Third party logistics providers can also help direct-to consumer retailers by providing them with lower shipping rates based on the large shipping volume of their combined client base of 3PL customers.  This helps to ensure that these savings are passed along to consumers, keeping shipping costs low and competitive.

Personalization, Customization and Other Value-Added Services

Packaging and personalization have increased in importance to consumers over the past few years.  Whether it is embroidery, engraving, gift wrapping or sustainable packaging, e-commerce businesses need to be ready and able to satisfy consumer preferences to maintain a high quality customer experience.

Customization is often quite labor intensive, however.  This might prove to be draining on your operation. Third party logistics providers are specialists in providing these types of value added services to meet an array of needs.  This can enable you to offer more products, more customization options and generate added revenue for your business.

With the recent popularity of unboxing videos, D2C retailers have recognized the importance of packaging their products to impress consumers.  You Tube has thousands of these amateur videos showing consumers opening purchases that they received from online retailers.  Because of this trend, retailers are making the unboxing experience more personalized and have been investing in more brand-centric packaging to create a more memorable customer experience.

Consumers love the authentic nature of the unboxing videos and often rely on this when deciding which products to purchase. 3PLs can also provide customized messaging and communication during and after the sale.  Email confirmations of shipments can be sent directly to consumers or the e-commerce platform if the D2C retailer prefers to communicate with consumers directly.

Effective, Responsive Customer Service Makes Consumers Happy

Whether you run a small e-commerce business or a major online omnichannel retail enterprise, consumers demand excellent service.  Did you know that over 65% of consumers report cutting ties with a brand after suffering one poor customer experience?    That single sobering statistic gives us a window into the psyche of consumers.  Industry studies also report that 71% of customers expect to receive customer support within 5 minutes.  Yes, consumer expectations regarding service and support are high.  Can your business deliver?

Here is another area in which 3PLs can be effective.  As specialists in solving a wide array of challenges for many different types of customer businesses, third party logistics service providers have already invested in warehouse space, technology, systems and a trained workforce.  With their resources, 3PLs are better positioned to be flexible to help you scale your back-office operations up or down whenever needed.  Some 3PLs provide call centers to expedite resolution of customer issues more quickly and process returns. This allows your company to focus on your core business without being forced to make substantial investments in space, technology and labor resources on your own.

Summary

Ensuring a top-notch customer experience is critical to the future of brands and online retailers.  In today’s exceptionally fast paced world, e-commerce retailers are increasingly turning to third party logistics providers for help.