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5 Signs it May Be Time to Switch Your 3PL Fulfillment Partner

Blog Post
Here are 5 signs that may indicate you need to switch eCommerce fulfillment providers and what to look for in a third-party logistics (3PL) partner.
picture of the outside of a radial ecommerce fulfillment center

The last few years have proven that retailers must respond to change with flexibility, agility, a laser focus on customer experience, and a keen eye for protecting profitability. Part of this equation is your eCommerce fulfillment provider. Is it keeping pace with you?  

eCommerce businesses have experienced a massive boon in the last few years, and this growth is expected to continue. Many are growing faster than their fulfillment provider has been able to scale.  

Here are 5 signs that may indicate you need to switch eCommerce fulfillment providers and what to look for in a third-party logistics (3PL) partner.  

  1. Orders take too long and cost too much to get to your customers.  

    This can happen when fulfillment providers do not have enough distribution centers or fulfillment locations within a 2-3 day proximity of the majority of your customers. Having locations near your customers ensures faster fulfillment and reduces shipping and final mile costs. The farther a 3PL has to ship orders, the more it costs you and your customers. This can also damage your brand reputation, and negatively impact customer experience and your competitive advantage. 

    Look for an eCommerce fulfillment provider that has the size, infrastructure, and growth strategy that either mirrors yours or outpaces you. A 3PL should take the time to get to know your current needs and future roadmap, as well as address contingencies such as sudden viral sales and peak events.  

  2. KPIs get missed during peak season.

    If your 3PL missed KPIs and struggled to fulfill orders on time during peak, or you experienced higher than normal return rates for mistakes the 3PL made, you may need to consider whether they have the capacity to scale to meet your needs. Scalability needs to be something they can do now, not something promised for the future.  

    Your 3PL should be able to seamlessly scale to handle your highest volumes during peak season. Likewise, they should also be able to scale down during your low times. Look for a 3PL that openly discusses how they will scale and demonstrates through automation, facility capacity, operational efficiency, and the history of seasonal hiring that they will be able to ensure that every peak customer has a positive order fulfillment experience.
  3. Promised technology solutions are not delivering results.  

    There is a lot of excitement around artificial intelligence (AI) and machine learning (ML) advancements – and many technology vendors are using the terms AI in their product marketing. There are technology solutions that do indeed leverage real productivity enhancements based on AI and ML, but many applications are still immature. If your 3PL promised that its technology would deliver certain advantages and you’re not experiencing those benefits, you may need to find a provider that has a solid technology strategy with proven impact.  

    AI is on every company’s radar, but do not buy into overhyped advertising from yet-to-be-proven software. Look for a 3PL that offers and uses technology that produces the results you need now – with an eye on future growth and AI innovation. Solid, proven solutions that yield real-time inventory visibility, a robust, easy-to-integrate order management platform, and reporting that delivers insights to make crucial decisions in the moment will help you meet your promises from click to delivery.  

  4. Automation is overshadowing the human touch.  

    Every 3PL needs to be investing in increased automation; not only does it improve efficiency, it reduces costs and can improve order accuracy. However, if your 3PL seems hyper-focused on its robotic automation to the point that it’s lost sight of the value of the human touch in order fulfillment, you may want to re-evaluate your relationship. Customers value personalization and increasingly, a delightful unboxing experience that feels personal and may include hand-written notes. The personal touch differentiates many eCommerce brands and a 3PL needs to be able to support this.  

    Look for a 3PL that values people and leverages the human touch to tailor personalization solutions that are right for your brand.  
  5. Order fulfillment seems disconnected from the rest of the business.  

    If your 3PL only focuses on order fulfillment without taking a holistic interest in your eCommerce business, you will miss your omnichannel customer experience goals. Order fulfillment is integral to customer experience; it cannot stand alone. Yet, some eCommerce fulfillment providers operate as a single-point vendor, focusing strategically on order fulfillment, and leave you to consider how the rest of the business fits in.  

    A 3PL should understand how your business operates and work with you to be part of a holistic omnichannel approach. Look for a 3PL like Radial that has deep eCommerce expertise that goes beyond fulfillment and that takes an invested interest in the whole of your business. This may include everything from omnichannel solutions, transportation management, outsourced customer care, to payments and fraud solutions. The more comprehensive a 3PL can be in integrating tailored solutions that meet your needs, the more streamlined operations you’ll experience. 

If any of these 5 signs resonate with you, take the time to evaluate whether your current fulfillment partner is truly meeting your needs or whether you need to switch to a 3PL that has the infrastructure, experienced people, industry expertise, scalability, and partnership mentality that will support you today and be there for you in the future. 

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