- Define your logistics needs: Before you start looking for a 3PL, it's important to have a clear understanding of your logistics requirements. This includes the types of products you sell, the volume of shipments you handle, and the locations you serve. You should also consider any unique requirements or challenges you face, such as handling hazardous materials or meeting strict deadlines. Will you be selling D2C, B2B, or both? What channels are you selling through? Are their specific requirements you have? These are just a few of the questions you'll need to answer.
- Research potential 3PLs: Once you know what you're looking for in a 3PL, it's time to start researching potential providers. Look for companies that specialize in the services you need and have a proven track record of success. Not all 3PLs are the same, and quite often, each one has it's own speciality. For example, Tondo Fulfillment's specialty is low SKU count, high volume, small/light products in the D2C space (i.e. costume jewelry, cosmetic, hair care, vitamins/supplement brands). It's where Tondo Fulfillment has the most experience, and it's where they have the deepest discounted shipping rates. You can find information on 3PLs through online directories, industry associations, or by asking for recommendations from other businesses. Don't be afraid to ask for references or case studies from the 3PLs you are considering – this can give you a good idea of their capabilities and how they have helped other businesses.
- Evaluate their capabilities: When evaluating potential 3PLs, make sure they have the resources and capabilities to handle your logistics needs. This includes the right equipment, facilities, and personnel. Consider their technology capabilities as well – do they have advanced systems in place for tracking shipments, managing inventory, and handling returns? Do you still have your finger on the pulse even though they are handling the backend of your business? Do you have an account representative you can text or call at any time? Make sure the 3PL you choose has the infrastructure and resources to support your business.
- Consider their pricing and contracts: There is an old adage that goes something like "Good work ain't cheap, cheap work ain't good" –– and it certainly applies to the 3PLs. Price is an important factor to consider when choosing a 3PL, but it shouldn't be the only factor. Look for a 3PL that offers competitive pricing and transparent terms. Are they shipping same day? Are you getting the full quote? Are there hidden fees or fuel surcharges that may not be included? Is the contract month to month or are you locked in for a year? If they do a poor job and you want to leave, is there an exit fee for a certain amount of months? Make sure you carefully review the terms of their contract before signing. This will outline the rights and responsibilities of both parties, and can help prevent any misunderstandings or disputes down the line.
- Look for value-added services: In addition to traditional order fulfillment services, consider whether a 3PL offers any value-added services that could benefit your business. Tondo Fulfillment is interesting because they have several of their own eCommerce brands. They have scaled some of them to 7 figure weeks. Tondo Fulfillment has strategically partnered with top companies in the eCommerce space to streamline your growth and operations (i.e. Attentive, Klaviyo, Gorgias). The partnerships allow Tondo Fulfillment to pass exclusive discounts to their fulfillment clients. It's this type of value add that can help streamline your operations and improve customer satisfaction.
- Communicate with the 3PL: Good communication is essential to a successful partnership with a 3PL. Make sure you have a clear understanding of their processes and procedures, and that they are responsive to your needs and concerns. What is the response time per their SLA? Are you getting answers in real time or days later? Are you given a ticket system of do you have an account representative? It's also important to establish clear lines of communication and establish a plan for how you will communicate with each other in case of any issues or changes.
- Review and evaluate the 3PL's performance: After you have chosen a 3PL and started working with them, it's important to regularly review and evaluate their performance. This can help you identify any areas where they may be falling short, and give you an opportunity to address any issues before they become major problems. Are they following your pack-out requirements? How many orders are getting short-shipped? Are customers receiving your products or another client's product (the horror stories we've heard...)?Are thy shipping same day? Are they receiving same day? It's these types of questions you need to ask yourself when reviewing the performance. Make sure to establish clear performance metrics and benchmarks to help you track the 3PL's progress and determine whether they are meeting your expectations.
By following these steps, you can find a 3PL that is a good fit for your business and will help you streamline your logistics operations. Don't be afraid to take your time and do your research – choosing the right 3PL can make a big difference in the success of your business.