A 3PL (third-party logistics) is a service that allows ecommerce brands to outsource their fulfilment processes, such as order processing, warehousing and managing returns, to a third party. A 3PL unlocks various benefits for ecommerce businesses because it aims to ensure seamless order fulfilment while reducing logistics costs.

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However, if the 3PL you have partnered with cannot meet your fulfilment requirements, it can be disastrous for your ecommerce business. Choosing or continuing working with the inappropriate 3PL provider can create problems such as higher-order processing time, costlier fulfilment, delivery delays and customer dissatisfaction. Such problems can prove detrimental to your ecommerce brand's reputation, hinder your brand's growth and reduce profits.

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In this blog, you will learn about signs it's time to fire your 3PL and make the switch to a new one.

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When to fire your 3PL provider: Signs to look for

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Outsourcing order fulfilment doesn’t always go as planned. Maybe your partnership with your current 3PL started off strong but isn’t working anymore due to varied reasons. Nevertheless, ecommerce brands must fire their 3PL provider when the situation calls for it. Here is the list of signs you should look for if it’s time to fire your 3PL provider.

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1. Not fulfilling orders properly

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Are you experiencing situations like delays in shipping orders or wrong orders being shipped to the wrong customers? Are your customers complaining about receiving damaged orders? Delay in shipping and mixing up of orders point towards larger inefficiencies on the part of your 3PL. Your current 3PL provider may be unable to fulfil your orders on time due to inefficiencies like lack of an automated fulfilment system, lack of expertise in this area, understaffing and untrained staff.

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Irrespective of the reason, if your orders are not efficiently fulfilled, you will dissatisfy your customers and lose them to the competition. Research shows that 51% of customers will never purchase from a brand again after just one poor customer experience.

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Eshopbox is an experienced 3PL provider with an automated fulfilment process that ensures seamless order fulfilment with an incredible order accuracy rate of 99.75%.

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2. Lack of proper inventory management

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Are you having trouble tracking inventory? Are you experiencing stock-outs, overselling, and delays in shipping? If yes, your current 3PL provider lacks an efficient Inventory Management System (IMS).

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Inventory management keeps track of inventory, from optimum levels in warehouse shelves to orders out for delivery and returned products that are restocked. Efficient inventory management is essential in ensuring inventory accuracy and maintaining sufficient inventory, which prevents stock-outs and overselling. Such situations make ecommerce brands lose out on sales and revenue.

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Eshopbox’s actionable dashboard provides real-time inventory updates to ecommerce brands to maintain optimum inventory levels as well as prevents overselling and stock-outs. This helps brands save on operational costs.

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3. Manual order management

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Does your 3PL provider give you data on how many orders are received, which sales channel they are received from, and what order management stage they are on? If not, they lack a proper order management system. Even if this data is provided to you, ensure that they are not manually extracting it and rather have a system for the same.

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Automatic and seamless syncing of data on inventory, sales, and returns across multiple sales channels is essential for the smooth functioning of any ecommerce brand. This creates less room for human errors and saves time by automating repetitive tasks. It also ensures order accuracy, which is a must for customer satisfaction.

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The actionable dashboard of Eshopbox seamlessly integrates data across multiple sales channels like Amazon, Shopify, WooCommerce, Flipkart and more, and compiles them in a unified view. Moreover, Eshopbox provides real-time visibility into sales performance, inventory, orders and returns to maintain transparency.

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4. Bad reviews and unhappy customers

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Are you constantly getting bad reviews from customers? Is your mailbox flooded with customer complaints? If yes, it's probably time for you to fire your 3PL provider.

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Customer satisfaction is ensured by providing:

• Lightning-fast shipping (63% of online shoppers expect three-day delivery)
• Delivering the right orders, ensuring order accuracy to the right people in the right condition with no in-transit damage
• Creating a unique unboxing experience using custom packaging
• Providing real-time order tracking to customers and answering WISMO (where is my order) calls
• Ensuring a hassle-free return process

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Successfully completing the steps mentioned above and delighting customers rests largely upon a 3PL provider's shoulders; after all, it is the 3PL provider who will pick, pack, ship products or handle the returns process. Therefore, if your customers are unhappy for any of the above reasons, it's time to fire your 3PL provider.

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Eshopbox provides lightning-fast shipping to delight customers. Moreover, you can choose custom packaging to create a unique unboxing experience for your customers. For instance, you can opt for flexible packaging rules to add marketing inserts, logos, custom messages and more.

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5. Lacks cost-effective shipping strategies

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Is your 3PL provider using cost-effective shipping strategies? A shipping strategy that focuses on cost savings helps ecommerce brands increase their profit margins. It can be ensured by-

• Having multiple ecommerce warehouses spread across the country
• Splitting inventory across them strategically (research shows inventory distribution can reduce shipping costs by 25%)
• Coordinating returns with an upcoming delivery in the same location to save on return shipping
• Having access to discounted shipping rates

A check on all of the above strategies means your 3PL is using the right methods. If not it's time to switch 3PL providers.

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Eshopbox has a distributed network of fulfilment centres, and you can take advantage of negotiated shipping rates as Eshopbox has tie-ups with multiple courier companies. Furthermore, Eshopbox uses its proprietary algorithm to find brands' most cost-effective shipping method. Eshopbox also schedules the pick up of returns with an upcoming order delivery in the same area so that you do not have to pay for return shipping, making returns profitable for you.

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6. Returns process is complicated and costly

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Is your 3PL’s returns management process smooth for the customers? A complex returns process that cuts into your profits is a big red flag for 3PL providers. If the returns management system is not seamless, it will displease customers and not bode well for your brand’s reputation. According to research, 33% of customers immediately consider switching brands after just one bad experience. Thus, whether customers are likely to buy again from an ecommerce brand or not is mainly dependent on how seamless the return process is.

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It is time to fire your 3PL provider if-

• Customers cannot easily initiate a return or exchange request.
• Customers have to call or mail you to initiate returns.
• Proactive return notifications are not sent to customers (as diligent communication delights customers).
• Returned orders are not restocked or refurbished on time; this reduces the profitability of an ecommerce brand as they cannot quickly resell the product.

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With Eshopbox’s robust returns management system, customers can easily initiate returns or exchanges on the customer portal and receive proactive return notifications. Also, returned products go through a quality check and are refurbished or restocked, depending on their quality. This helps ecommerce brands resell returned products and make returns profitable.

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7. Complicated pricing structure

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Your 3PL may have attracted you with a low base rate, but are you now paying extra for value-added services or for functioning on a Sunday? Is the per-order or per-transaction fee comprehensible? A complicated pricing structure full of deductions you cannot understand is a sign that you should fire your 3PL. You should be able to know what you are being charged for. There should not have hidden costs. Additionally, you need to ensure that you only pay for services you use and not more.

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Eshopbox has a simple fee structure and pay-as-you-go pricing, so brands only pay for services they use; there are no hidden costs.

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8. Not scalable enough

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Is your ecommerce brand growing? Are orders pouring in day and night? Well, congratulations! However, it might be possible that your brand has grown and thus outgrown your old 3PL provider.

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If your 3PL cannot fulfil the increased order volume, it is time to fire them. An unscalable 3PL provider will not be able to cope with the increased number of orders leading to storage issues (less space and higher costs) and delay in order delivery. Higher order volume may push the 3PL to only focus on fulfiling orders and negating other aspects like a customer’s post-purchase experience. For example, they may make a packaging mistake (increasing the chances of in-transit damage) and be unable to provide order tracking information to all customers. Complaints from dissatisfied customers will pour in, and bad reviews will dissuade new customers from purchasing from you.

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Eshopbox is the right choice for ecommerce brands of all sizes- small, medium and large, as it is scalable enough. Eshopbox efficiently fulfils orders even during peak seasons by allocating fulfilment resources according to the current order volume without additional costs. Moreover, Eshopbox delights each and every customer, even during peak season, by not compromising on customer experience.

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Make the switch to Eshopbox

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Eshopbox is an all-in-one 3PL provider using modern software to meet all of an ecommerce brand's fulfilment and logistics requirements. Brands of all sizes partner with Eshopbox to ensure fast, affordable and efficient fulfilment. Ecommerce brands can store inventory closer to customers using Eshopbox’s distributed network of fulfilment centres. So if you feel that you need to fire your current 3PL provider and partner with a new one but are worried about finding the right 3PL, Eshopbox is the solution that ensures superior fulfilment, control and higher profitability.

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We were looking to build a strong partnership with a tech-enabled logistics company with an in-depth understanding of ecommerce. We chose Eshopbox because they had the best infrastructure, the latest technology, and a very competitive approach.

-Nitin Bhargava, Head Ecommerce, Blackberrys

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Bottom line

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Partnering with the right 3PL provider is essential for ecommerce businesses. The wrong 3PL can compromise your brand’s reputation, cut into your profits and make you lose customers. It is best to switch 3PL providers when the situation calls for it. Look for signs like lack of data automation, bad reviews from customers and lack of scalability to decide whether you need to fire your current 3PL provider and partner with a more robust one like Eshopbox.