When is it time to switch your 3PL provider?
There’s no doubt that order fulfilment is critical to the success of your business. It is therefore vital that your 3PL provider is the best fit for you, now and in the future. While your current 3PL provider might have been the best choice when you first outsourced order fulfilment, is this still the case? How do you know if it’s time to switch, or even if you want to switch? After all, changing provider can be costly and time consuming. Consider this however – if your 3PL provider isn’t helping you to offer best-in-class customer experience, especially in a market with rising ecommerce customer expectations, you will be losing more in potential customers and revenue in the longer term. We look at nine reasons to why a business would consider switching 3PL provider.
In ecommerce, delivery has a significant impact on customer experience. Whether it’s speed, cost or reliability, these factors can be ‘make or break’ for online shoppers. In fact, a survey conducted by MetaPack in 2020 found that 96% of consumers consider delivery an essential factor when making an online purchase. As more and more businesses expand into the world of ecommerce, customer expectations for delivery are rising too. According to a report by Statista in 2023, 38% of shoppers expect faster delivery from New Zealand online retailers. If your 3PL provider is not offering fast and efficient delivery for your customers, it might be time to consider finding one who can!
Inefficient warehouse systems
Your reputation is at stake when you outsource a part of your business. Inefficient warehouse systems result in miss-picks, loss of product and messing up of customer orders. The cost to your business of these errors can have a dramatic effect on your overall profit, as well as on customer retention. Warehouse issues are often minor – a damaged box, a few items missing from shelves, a late shipment. Individually these may seem like the cost of doing business, but taken together they can be a strong argument for switching supplier. Fulfilment is not a perfect science and mistakes will happen, but these should not be a regular occurrence, and your 3PL partner should be working with you to resolve them quickly and efficiently.
Technology advances at a lightning speed and ecommerce is no exception. Is your current 3PL provider keeping up with the latest most efficient ways to streamline processes, provide you with real-time inventory management, sync with your online store, and ultimately get your product to your customers faster, more securely and more efficiently? Access to the right technology is essential for efficient order fulfilment and you may be missing out on potential growth opportunities if your 3PL provider is not investing adequately in continuous improvements.
While often lower down the priority list for retailers, sustainability is becoming more and more important for consumers. According to a report by Statista in 2023, 34% of shoppers expect eco-friendly packaging from New Zealand online retailers. If your 3PL supplier is not already offering this option, or even considering it, it may be time to consider switching. Eco-friendly packaging is often a point of difference between online retailers, and it’s likely to become more and more important. You may also want to consider a 3PL provider that allows to you to create customised inserts, shipping labels and more.
As your business grows you need a 3PL provider who is flexible to scale with you. You may require additional warehouse space, logistics services or expanded geographical coverage. Perhaps you have a product that is very seasonal. The inability to adapt to the changing demands of your business or industry can indicate it’s time to find another provider.
Too many customer complaints
Ultimately the most important part of your relationship with your 3PL is your customers. At the end of the day, they get the final say as to whether your order fulfilment meets their needs or not. If delivery is not up to standard you will quickly find out – whether it be bad reviews on social media and other review sites, or simply a decline in sales. If your customers are consistently unhappy with the delivery experience it’s time to switch 3PL.
We can’t talk about the reasons for switching 3PL providers without mentioning cost. After all, logistics, warehousing, pick and pack and delivery are likely to be some of the largest costs your online business faces. However, it’s also true that cheapest isn’t always the best. What you should be considering, however, is whether the premium you are paying for order fulfilment is justified by the value to your business. Are there any savings that you gain by relationships your 3PL provider has, for instance with logistics companies? Are there any cost inefficiencies that are adding up over time? Money saved here can be invested elsewhere in your business, so if you are not getting your moneys worth from your current provider, it’s time to look around!
Looking to switch 3PL provider?
If it’s time to consider switching your 3PL provider, don’t forget to give Stocka 3PL a call. At Stocka, we understand the importance of working together with you to ensure your customer’s delivery, and returns, experience is best-in-class. With the latest technology for integrating with your ecommerce platform, advanced warehouse technology, transparency so you have control of your inventory at any point in time, returns management and trusted delivery partners, you can be confident that Stocka can meet all your 3PL needs.
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