Are you a bit of a control freak? Do you wish to start an online business “the right way”, but still don’t want responsibility of warehouse managing? Well, there is an option; Work with a 3PL (shortened from Third Party Logistics). A 3PL is a service a lot like the one dropshippers offer customers; A warehouse that handles the daily logistics management, such as inventory, staff, picking/packing and also shipping and freight forwarding.
Unlike dropshipping, you will need to invest in your own inventory, but if you have a clear product in mind that you want ownership over, this is definitely the way to go for you. You will naturally also have to pay to have this inventory at a 3PL warehouse, but the cost of outsourcing your warehouse can surely be worth it depending on the volume of your shipments. This is because 3PL’s have great carrier agreements that you yourself just can’t compete with. Read about Cost Control here.
Let’s view the benefits of outsourcing your warehouse to a 3PL:
That’s a definite yes! Outsourcing of your warehouse is something that is here to stay and will most likely only become more popular as times go by. A 3PL is worth considering if you’re business is fulfilling more than 10-20 orders a day, running out of valuable storage space, or if you’re afraid any spike in sales will be hard to accommodate causing you to damage your reputation. View all our 3PL partners
Alternatively, you can start out with drop shipping to get an insight into the world of e-commerce and logistics. It’s a relatively inexpensive way to test the potential of yourself as a business owner.
When you know the future of your online business with the products you wish to sell, you can redirect your business’ logistics from your dropshipper to a 3PL. Thus increasing your profit margins and gaining insights to your logistics and control of the product quality. Still, you don’t need to take care of packing, shipping or returns, since the 3PL will handle this.
If you want to know more about 3PL and warehouse management you can read the guide “Warehouse management and optimization for e-commerce“.