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US third party logistics companies • Manage the flow of your goods in the States

US third party logistics companies

Manage the flow of your goods in the States!

What are US third party logistics?

US third party logistics (3PLs) are outsource companies who manage the global or US supply chain roles for manufacturers, retailers, eCommerce brands and industrial companies. 3PLs companies in the USA specialize in the North American supply chain and logistics with partners across the nation. Third-party companies also have international partners and can manage most end-to-end supply chain demands.

In the US, 3PLs offer logistics and warehousing services for storage, inventory management and order fulfillment from a single or multiple US warehouse locations. Some third party services provided by warehousing in USA include:

  • Order fulfillment for direct-to-consumer and business-to-business customers
  • Distribution centers and bulk fulfillment of goods
  • Transloading services from floor-loaded container to multiple palletized, LTL truckloads
  • Freight, transportation and trucking solutions
  • End-to-end supply chain solutions for customized business requirements

Who uses warehousing and fulfillment in USA?

Warehousing and fulfillment USA service providers are used by domestic and international brands with a growing market in the US. The purpose of warehousing and fulfillment services in the United States is to ship orders to customers from supply chain hubs across the US. These hubs are called fulfillment centers and are near customers.

Retailers, eCommerce brands, manufacturers and industrial businesses of all sizes and markets outsource warehousing and fulfillment to USA third-party logistics (3PL) companies. The main reason companies use fulfillment services in the US is to store products closer to their customers. By storing inventory in warehouses near customers’ homes, you ensure orders arrive to customers on time with less shipping cost.

3PL providers are a solution to get orders to USA customers faster without costing your business an arm-and-a-leg in expansion costs. By using a 3PL, you remove the operating cost, startup capital required and danger of spreading the leadership team too thin by warehousing and fulfilling orders from your own USA facility.

3PLs are logistics experts with warehouses operating across the US. Third parties are able to scale your supply chain rapidly as your footprint expands.

Why are US third-party logistics providers 3PLs important today?

Today, third-party logistics providers 3PLs offer important services to help in-house operations teams reduce cost, increase accountability and define efficient logistics processes.

The supply chain and global trade are more complex than ever. Growing operations run into new challenges daily and require a lot of energy to launch new value streams in the supply chain. 3PL providers remove this barrier to entry by taking on the brunt of supply chain expansion efforts.

Third-party logistics providers are supply chain professionals who allocate experts to partner with you. Partners are as hands-on (or off) as you prefer. The 3PL experts can design custom, end-to-end supply chain plans for each product line. Or they can simply fulfill orders. You are in control of what is outsourced today.

How does third party logistics work?

Third party logistics (3PLs) work by providing outsourced supply chain services to complete logistics jobs on behalf of clients. Third party logistics services work by forming a partnership between in-house sales and operations teams and 3PL logistics companies who manage daily backend operations.

3PL companies operate under several logistic company categories such as fulfillment centers, distribution centers, shipping warehouses, 3PLs, 4PLs and more. Even with their unique supply chain specialties, each of these logistics businesses start working with clients using a similar on-boarding process.

Here is an outline of what to expect when you start working with a third party logistics partner.

  1. Introductory call to introduce both companies
    1. the 3PL introduces self and services
    2. the Client introduces current needs and problem at hand
  2. (when complex) 3PL analyzes problems and proposes potential solutions
    1. 3PL assigns a 3PL Account Executive person or Team to handle all Client needs
  3. 3PL and Client agree on proposed solution
    1. Pricing rates and contract are sent
  4. Contract signed by both parties with
    1. start service date and
    2. service agreement for initial workload
  5. 3PL prepares warehouse Account and facility for initial receipt of goods
  6. Client sends first goods to facility
    1. When applicable, Move-out fees are incurred when goods leave their current 3PL
    2. Move-in fees are invoiced by the new facility at standard inbound receiving rates
  7. Client and 3PL Account Executive work closely together
    1. they communicate often to coordinate inbound and outbound work

What are main services offered by US third party logistics?

The main services offered by third party logistics (3PL) companies are storing goods, managing inventory, picking, packing and shipping orders. 3PLs also provide a variety of value-added services such as kitting and fulfillment warehousing.

Services offered by third party logistics companies in the US can be customized to meet the end-to-end needs of most retailers and eCommerce brands. Custom services including bundling, labeling and ticketing products, and designed product packaging. 3PLs also work with manufacturers and industrial clients to do light assembly.

Terms of outsourced 3PL contracts are negotiable and can be tailored to meet your exact needs. Interview a handful of 3PL companies and find the right third-party. Good 3PL partners mold their logistics services to do business like you need. Clear and helpful communications are necessary to run a smooth logistics pipeline.

What are the best shipping locations to fulfill online orders delivered in the US?

Warehousing in USA near customers

Best shipping location for online order fulfillment is near customers

The best shipping locations to fulfill online orders delivered in the US are near the majority of your existing and forecasted customers.

To find the ideal shipping location, consider your current state and forecast the future geographic footprint in the US market. Get started with these questions to identify where to find a warehouse partner:

  1. What are your business and growth goals in the USA?
    1. Because the 3PL must help you grow and keep up
  2. Where will goods enter the USA? What sea port or airport?
    1. Because moving goods is expensive. Moving them less is usually better.
  3. Where is the order density of customers most concentrated?
    1. Because customers expect to receive orders quickly. If 80% of customers are in New York City, get an East Coast fulfillment center.

Generally, there are 4 regions to consider for warehouses and shipping locations in the USA:

  1. East Coast warehouses to serve the Atlantic coast of the United States
  2. Midwest location to serve the middle of the States with reasonable ship times to the West Coast
  3. Texas facility for quick shipping to Texas, SoCal and the Midwest
  4. West Coast warehouse in California to serve the Pacific coast and nearby states.

A single fulfillment center works great for many brands who have concentrated customer populations or if 3-7 day shipping is acceptable.

If final-mile, one-day or two-day deliver are a priority the 3PL you work with must have multiple warehouse spaces across your country. To achieve these fast delivery times, inventory is split across warehouses throughout the United States. Customers orders are sent to the warehouse with the shortest, cheapest shipping route.

Should I use a fulfillment company for warehousing in USA?

Businesses should use a fulfillment company for warehousing in USA if they need logistics expertise to scale all or part their supply chain. Fulfillment companies are supply chain professionals who optimize logistics processes for a living. Their logistics expertise is the core of running an efficient USA warehouse operations. This expertise makes them an invaluable and knowledgeable partners who run efficient supply chains and are able to scale quickly.

A warehousing partner in the USA is a good option to consider when any of these apply:

  • Order volume and order density in the US is increasing
  • Customers complain about shipping times to the States
  • Products require problematic customs clearance
  • Goods need additional services or handling before shipping to USA customers
  • Launching retail or eCommerce sales in the USA

If you are a fulfilling small order volumes, consider fulfilling from your own facility until volume increases. For instance, 3PLs are not cost effective for shipping only 10 orders each day. In this case, it would be better to fulfill with your current solution until demand in the United States increases.

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