3 Ways a Third-Party Logistics Provider Can Support a Multi-Site Distribution Model

Saving on Shipping

The majority of American shoppers (62.2 percent) say free online shipping is “very important,” according to a consumer survey by the National Retail Federation.

Naturally, retailers and ecommerce companies want to satisfy their customers, but demand for low-cost shipping puts pressure on their transportation departments.

In fact, the cost of shipping is the biggest challenge facing 63 percent of smaller ecommerce companies, according to a survey by Shippo.

How Can I Add More DCs to Satisfy My Omnichannel Customers?

A third-party provider can be a valuable resource when you want to expand your DC network. Here are three reasons why.

1. Optimal DC network configuration. An experienced third-party provider will take a strategic approach to network configuration and help you determine the right DC locations for optimal efficiency for your current and future business.

You’ll have access to your provider’s established distribution network without adding to your overhead expenses. As a result, you can ship available inventory from DC locations closest to your customers, helping to reduce transit times and control shipping costs. If you outgrow your DC network, it’s much easier to expand with a 3PL.

2. Advanced technology. A qualified provider should have sophisticated technology solutions in place – order management (OMS), warehouse management (WMS), and transportation management (TMS). You’ll have state-of-the-art systems at your fingertips without the eye-popping price tag.

A robust OMS is particularly important for companies utilizing a multi-site distribution model, as it enables them to see inventory across their entire enterprise — warehouses, stores and vendors (for drop shipments) – and determine which fulfillment source to pull from for the fastest and most affordable service.

3. Expertise and best practices. A knowledgeable provider will take time to learn about your supply chain priorities and understand the bigger picture, so they can design a solution that addresses your real issues and delivers the best results. When it comes to implementation, they’ll have proven processes in place and knowledge of best practices, so they can get operations up and running quickly.

With the support of a 3PL, you’ll be ready to give your customers the distribution options they’re looking for – and maybe even some they didn’t realize they needed.

To learn more about how outsourcing can help you to address a variety of common business challenges, download the ebook: Ultimate Fulfillment Outsourcing Guide.

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