3PLs Play Increasing Importance as the Time to Prepare for the Holiday Shopping Season is NOW
Leading providers of outsourced fulfillment solutions are opening new warehouse as fast as possible in 2017. Many of these new fulfillment centers are strategically located to enable next-day shipping to e-commerce customers across the United States. At capacity, these facilities it will be powered by a staff of approximately hundreds of full-time employees working alongside a state-of-the-art robotic autonomous picking solutions for maximum efficiency and accuracy.
These 3PLs (third party logistics firms) consider site selection as well as strategic carrier partnerships, so they can reach 100% of the U.S. population in no more than two to three days at extremely competitive rates, often with far less accessorial charges than other U.S.-origin zip code. Often the Midwest hub offers e-commerce retailers a quick two-day delivery transit time to New York City, and three-day transit to Los Angeles via ground shipping.
Managing split inventory cross-country is no longer a necessity when a fulfillment network can provide two-day delivery to most e-commerce shoppers. Coupled with industry-leading same-day shipping performance, these transit times ensure customer orders arrive quickly and accurately. The time savings is found in how rapidly warehouses can process an e-commerce order. In more cases than ever before, distribution centers, warehouse fulfillment centers, and 3PLs can capture the online order and within an hour of receiving the order and make sure it is delivered with a custom – and often personalized – brand experience.
This growth is not only in the Midwest. Since the consumer, thanks in part to Amazon Prime driving even more rapid delivery expectations, companies are looking at four to eight distribution centers and consider them part of important strategic initiatives to increase the capacity of a fulfillment network. The best technology available today, and the best people, increases throughput and empowers employees to work at full capability and capacity.
Area Development asserts gone are the days when companies simply asked their 3PLs to do the “pallet in-pallet out” drill. Increasing e-commerce companies expect 3PLs to perform a host of sometimes complex, intricate, and even strategic tasks that were once performed by the companies themselves, with never a thought that such activities, being so critical to the company’s success, could ever be outsourced. Interestingly, the arrangements are working out so well that not only are companies asking their 3PLs to handle more and more of these value-added tasks, but the 3PLs themselves are coming up with innovative value-added ideas that allow companies (their customers) to focus more on their core competencies.
From a technology perspective, whether the warehouse is at the manufacturers facility or a distribution center to ensure rapid on-time delivery, the increasing popularity in value-added services from 3PLs seems to be growing because of synergy between customers and 3PLs. 3PLs are happy to take these responsibilities on because they make money on labor. Then, as they get more involved, they start to see additional opportunities for revenue and profits.
As Q3 2017 approaches, final holiday inventory preparedness for both eCommerce and 3PLs are taking place.
Shopify insists the holiday season is the most important (and profitable) time of year for online businesses. The company provides some actionable advice to help small e-commerce firms take advantage of holiday traffic to generate more sales.
The holiday season is almost always the most profitable time of year for online businesses. Not only does the last quarter of the year see increases to the number of orders but the average order sizes also tend to be much bigger as well. In fact, some retailers make up to 40% of their yearly revenue in the last quarter alone.
Shopify acknowledges that with the day-to-day hustle of running an ecommerce business it is easy to forget approaching holidays. The last two months of the year is packed with special holidays that e-commerce retailers should use to hit yearly targets, move new products, and clear out old inventory.
Bottom-line: Start planning for the holiday shipping-season NOW.