How 3PLs help ecommerce businesses grow (without breaking)

Peter Tulisaari

By Peter Tulisaari Director of Business Development at King Solutions

ecommerce growthEcommerce is growing. This isn’t exactly news. After all, it’s something that’s been happening every year for nearly 20 years now. The thing is it’s not simply growing; it’s borderline exploding.

In fact, ecommerce is outgrowing retail.

In 2013, ecommerce grew by 14%. Comparatively, general retail growing at about half of that rate. That means ecommerce is actually consuming the market around it. It’s growing at such a rate, that it’s challenging the nature of the supply chain itself.

While it’s good that business is booming, the change in established systems has caused some areas to get congested. Namely logistics.

Changing the game
Shipping highly specified orders in tight windows of time is considerably different (and more difficult) than shipping mass quantities of like-products to individual stores on a set schedule. And thanks, in part, to companies like Amazon, things like free shipping and two-day shipping are becoming expectations in the eyes of consumers.

Retailers are scrambling to adapt and manage the new order of things. Even logistics giants like UPS are struggling to keep on top of things. A surge of last minute purchases essentially broke their systems during the Christmas season of 2013.

With things changing so rapidly and the need for precise, dependable fulfillment being more necessary than ever, retailers are realizing they need external help if they want to stay in the game.

They need third-party logistics providers.

3PLs help ecommerce businesses grow (without breaking)
If ecommerce is rapidly growing, that means there’s an opportunity for your business to grow with it. But fast growth, though it sounds like the best thing ever, can quickly expose pre-existing problems in your chain of operations.

A sudden increase in tension can break your business.

Partnering with a 3PL is a great way to not only help your business grow, but grow in a healthy, stable fashion. There’s a reason why 86% of Fortune 500 companies use 3PLs. Of course, you don’t have to be a billion dollar company to enjoy the benefits.

What are those benefits?

Superior industry knowledge
3PLs tend to work with a variety of companies in a variety of markets. If issues start to arise in your business, they’ve probably dealt with something similar before and know how to react. And if the market begins to change, they probably have a good idea of where it’s heading.

They know the tips, tricks, ins-and-outs that can save you a lot of time in the problem solving alone. Speaking of…

Time saving
The time you’d spend managing and sorting your logistics needs is completely freed up. They take care of it, leaving you with more time to run your business and strategize how you can utilize ecommerce more effectively.

3PLs also reduce errors, which saves considerable time as well.

They’re built to handle more
3PLs are built to handle increased sales, higher volumes of order, and general logistics growth. Though you might be able to support a degree of fulfillment now that will become more difficult to do as your business grows.

Higher volumes of ecommerce shipments inevitably require better rates, superior organization, real-time visibility on your supply chain, and more customizable shipping options. These are what 3PLs are designed to do.

But they don’t just handle your shipping.

3PLs can manage your entire ecommerce ordering process
In an effort to streamline efficiency, many 3PLs are taking over complete manage of their clients ecommerce outlets.

That means setting up digital storefronts, updating and managing inventory, handling returns, and of course, providing shipping services for all of it. This allows them to not only take more items off your plate, but also provide better service overall.

Using advanced software and tracking systems, 3PLs are able to leverage high-level data. With this, they’re able to better understand customer behavior and industry trends, allowing them to adapt logistics services according and providing you with better services and more relevant information.

What does a 3PL partnership look like for your business?
Whether its basic fulfillment needs, LTL services, or full online store management, we’d love to talk about your ecommerce needs. If you’re looking to grow without breaking, King Solutions is here to help you do just that.

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