A large part of a 3PL provider's day-to-day operations is spent fulfilling customer orders on behalf of their 3PL clients. While it may not seem like a large and resource-consuming task, a lot goes on behind the scenes to ensure the correct product is chosen and delivered.
The process can be broken down into four main sections. Receiving inventory, picking, packing, and shipping. Each one of these sections requires close attention to detail so that orders can be fulfilled correctly, and on time.
Receiving Orders
A client can enlist a 3PL provider for many reasons. Usually, product providers are simply unable to keep up with demand and store all the orders, making outsourcing to the 3PL the easiest way to get their orders fulfilled.
To start, the company using the 3PL services moves their product to the 3PL providers warehouse where it is stored. Once the 3PL provider receives the product, the whole inventory is categorized and added into some form of an Inventory Management System (IMS). This allows the 3PL and the product seller to keep track of what inventory is available at the warehouse, and when it is time to send more product. The IMS can be physical or digital, and helps prevent shorts or over stocking an item. Once the product is in the 3PL provider’s warehouse, they can get to work fulfilling your orders as they come in.
While physical copies and virtual versions of an IMS exist, there are benefits and drawbacks to each. A physical IMS can be a physical piece of paper to record inventory on, or even a spreadsheet where items are manually updated. While both of these forms can be easily learned and physical objects are sometimes preferred over digital, these can easily get lost or damaged. The physical IMS is also more prone to accidental changes and mistakes.
A virtual IMS is usually part of a more expensive software package and usually has a longer learning curve to educate new workers and customers. However, they are often far more sophisticated and advanced than typical physical IMS.
Features include
- The ability to receive purchase orders
- Restock products into inventory remotely
- Move products between zones and bins
- Keep track of damaged products
- Pick and pack products to fulfill orders
- Load orders with product or order segmentation from almost any device.
The technological side to these virtually-hosted IMS allows for more customizability and access which can be extremely useful for managing many different orders.
Picking
Once a customer places an order, the order request is typically made through the 3PL provider’s Order Management System (OMS), which is linked to your online store or sales. However, some 3PL partners still require manual submissions for new orders. An OMS allows the product provider and the 3PL to see what needs to be picked and prepared to be shipped.
Once an order has come through the OMS, the 3PL warehouse workers will begin to pick the order from the providers inventory. Using the IMS, warehouse workers can find the correct product in its designated location and add it to the order. Once the product has been picked, the total number of the remaining product is updated through the IMS.
Packing
After all of the products for the order have been picked, workers then assemble the order and begin to pack. Packaging usually depends on what the product provider has paid for. Packaging can either be marked with the product provider’s design choices, or standard shipping materials. The former is usually an additional cost. After the products have been packaged and sorted, they are then prepared for shipment.
Shipping
Once a product has been packed, the 3PL will organize its shipping method. A 3PL usually has three different ways they can deliver the product.
- Their own branded trucks and vans
- Outsourcing the delivery to another 3PL provider who would use their own trucks
- using domestic postal services such as UPS.
Once the boxes or pallets of product have been loaded onto the delivery vehicles, tracking is usually made available to the product supplier, and sometimes the customer. The tracking allows for accountability of the drivers, confirmation to the product provider that their product is en route, and peace of mind to the customer that their order is on the way.
Depending on whether the product is food, general goods, or something else, the product provider may offer a guaranteed speed of delivery to its customers. This information would be relayed to the 3PL provider during the order management process and expedited shipping costs would be discussed with the product provider.
Most 3PL providers offer one or two day shipping for an additional cost in their fees. This is extremely beneficial to smaller businesses who can’t afford to provide this option alone as it is comparably cheaper through a 3PL when bundling multiple orders in one delivery.
Reverse Logistics
While not made available by every 3PL provider, some offer reverse logistic services. Reverse logistics is the process of moving product from the buyer, back to the seller. This can occur for many different reasons such as returns, incorrect products, miss delivery and more. Despite not often being handled by the 3PL itself, it is still a part of the fulfillment process. Without, often returns and organizing the return of an item fall on the customer or product provider.
Conclusion
Utilizing a 3PL for order fulfillment can be beneficial to your business when trying to manage large numbers of outgoing orders and having to manage inventory space. Partnering with a 3PL will reduce the stressors associated with order fulfillment, and allow you to focus on other important aspects of your business.
Experience the benefits of technology led order fulfillment.
Birkby offers state of the art order management and fulfillment systems to ensure your products get where they need to be accurately and efficiently. Our use of Routeique® software allows us to offer you these industry-leading solutions.
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