In this article, we will discuss the concepts of drop shipping, 3PL. And as to why it is beneficial to outsource your fulfillment to the right service providers. We follow it up by navigating you with 6 tips for your consideration that would facilitate you to choose the best ones in this field.
At this stage, it is necessary to understand not only the connection between dropshipping and 3PL but the difference between the two as well.
A drop shipper assumes the responsibility of acting as a third party fulfiller of the orders by shipping them to the customer on behalf of your e-commerce business. By acting as your shipping partner to your retailing, they ship the product from the wholesaler to the customer only when there is an order from the customer for a shipping fee.
The difference between dropshipping companies and 3PL emanates from the fact that the former can also be the manufacturers of the product for which retailers can act as third party advertisers and receive a referral commission for each sale they make.
3PL firms as logistics players perform complex outsourced services, which include supply chain management functions.
A 3PL service provider acts as an interface between the manufacturers and retailers in which they undertake receiving of material from the point of origin, warehousing. And guides through the orders through assembly or fulfillment before shipping to the retailer or customer.
Thus, the crucial difference between a drop shipper and 3PL service provider is the former handles only the order processing and fulfillment aspects of the supply chain whereas 3PL delivers the full logistics services.
Top tips:
1. Longevity and Reputation:
The firms must have been in the business for a conceivable period, say not less than 3 years, should enjoy genuine reviews (a review website dedicated to customer reviews, as https://www.trustpilot.com) could be used to determine that.
2. Location of warehouses:
It is necessary for you to choose a firm that has its warehouses located in the proximity where your customers hail from.
3. Turn around:
You need also to check their turnaround time. Because customers may not wait for an inordinate period to get what they order delivered. The downside in this regard can be some products take as long as 15 days to deliver. There has to be a clear-cut mention on the days that would take to deliver the consignment. And wherever necessary it should be possible to provide a convincing explanation to the prospective customer for the likely delay in the delivery of the product.
Nonetheless, the shorter shipping time would have to be an important criterion in your selection.
4. The Price:
Their price structure should be simple, straightforward, and competitive. This means it has to be transparent and free of hidden costs. They also should not insist on long-term contracts as that would tie you down to a fixed fee structure, which will not enable you to exercise flexibility in offering shipping incentives. They should not constrain you with a minimum order requirement.
5. Understand the software:
It is necessary to make sure that the software they deploy is user-friendly. And offers updates providing solutions to fulfill the orders by suiting the changing the business environment. It should be able to automate order fulfillment. The choice would have to wear around on the one who offers an automated inventory shipping system.
6. Managing after ship and handling returns:
The hallmark in the after ship management is determined by the excellence they practice with the follow-up of the customers. Handling of them in chat and or emails determines the exemplary quality of those who really handle them successfully from the also-ran ones.
Main takeaways
We have explained to you the salient features and criteria you can adapt to succeed in your e-commerce business. With such knowledge that is also practical in nature, you can focus on your core functions. Once you have landed with a right choice with whom you can trust for the fulfillment of your orders.
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