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What Is a 3PL Company and What Do They Do?

 In Fulfillment, Inventory Management, Kitting, Logistics, Shipping, Supply Chain

Third-party logistics (3PL) companies specialize in performing shipping and other logistics functions on behalf of other companies. That means they can help organize products in a warehouse and have them ready for assembling and packing, shipping, keeping records of every item sent and where they were sent, handling returns, and much more. 

A company hiring a 3PL can decide how many aspects of their logistics they want to outsource, depending on specific business needs. In general, companies choose the 3PL services that will allow them to focus more on developing their competitive advantages, such as innovating unique products and expanding their company. Other benefits of using a 3PL provider include: 

  • Savings: A company may be able to forego investments in the vehicle, technology, employee, training, and warehouse expenses that logistics demand. 
  • Greater Expertise: Working with a 3PL can give you specialized industry knowledge that could otherwise take many years to gain, including industry connections, best practices, tips on international shipping, and much more. 
  • Easy Scaling: Companies can scale their operations to meet customer demands and sell more products with a 3PL, whether entering a new region or simply receiving seasonal orders.

With more than 25 years of experience, Elite OPS can bring you all these benefits and many more. Find out how an expert 3PL can serve your organization.

What Do 3PL Companies Do?

The specific services a 3PL can provide include the procurement and temporary storage of your products and/or materials before the sale. A 3PL can then take customer orders, pick products from shelves, and package them for shipment.

Other related services include integrating your software systems with theirs, managing your inventory data, and generating reports and forecasts. They may also take care of customer returns and refunds.

Finally, your 3PL can perform every aspect of transporting items. This can include consolidating disparate products into one shipment to reduce expenses and other efficient transportation methods. They can even transport sensitive items in a controlled environment.

If you partner with Elite OPS, we can help you save time and money, avoid costly backorders and returns, and forecast demand more accurately. We provide expert: 

  • Warehousing: We can customize your product storage plan for your specific needs, setting aside warehouse space for your organization within theft and fire protection zones.
  • Fulfillment: As your business grows and your order volumes increase, we will keep up with demand and ensure the right products are shipped promptly.
  • Kitting and Assembly: Allow Elite OPS to assemble your packages before they’re shipped, from simple assembly to complex, multi-media packages.

When Should You Consider Using a 3PL Company?

Not every company is ready to partner with a 3PL. But this may be a profitable consideration when your business faces these or similar scenarios: 

  • Seasonal Spikes: Your company experiences much higher sales volume in certain seasons, necessitating temporary increases in labor and logistics.
  • New Markets: Your business is entering a new region or country and needs to test distribution there without overly committing capital to a warehouse.
  • Transportation Costs: When shipping prices are a significant expense, a 3PL can lower them by consolidating loads and using volume discounts and other techniques.
  • Need for Efficiency: A 3PL can add efficient, standardized inventory management technology, logistics processes, and expert labor to handle your expanding operations.

As you expand your business to new locations and markets, warehousing your products in multiple locations improves your shipping time to customers but increases risk if you invest in those locations yourself. In contrast, you can pay a predictable flat rate for a 3PL to simply carry out logistics functions on your behalf in multiple markets.

Talk to the Experts at Elite Ops to See If They Are the Right 3PL Company for You

In summary, what is a 3PL company? It’s a way to save money and time. You can apply their specialized expertise in logistics to your business. This gives you and your employees more energy to focus on innovations within your core competencies. It can also mitigate the risks of technology and location investments and improve your customer experience. 

Elite OPS is your partner in Utah or Atlanta, GA. We can use our nearly 30 years’ experience to help you expand your business, decrease costs, enter new markets, handle seasonal sales volumes, and much more. Contact us to learn more about our services, or request a quote today.

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