Supply chains play a huge part in any retail business strategy, which is why many businesses choose to partner up with 3PL providers for peace of mind. Your relationship with your 3PL provider is likely to be very hands-on, especially if you’re planning to make the most of what a successful partnership can bring you. After all, you are trusting another company with your brand and product. In addition, the huge growth of e-commerce has birthed a big demand for 3PL providers, with most Fortune 500 (86%) companies and 96% of the Fortune 100 using services like these (Shopify). Many retailers use 3PL solutions as a means of handling growth, as when a brand grows, areas like logistics, shipping and fulfilment become more and more difficult. This is where high-growth brands tend to commit errors, which can ironically end up crippling growth (Shopify).
3PL operations can be very valuable and cost-effective for many businesses, and this is especially the case when the partnership is run smoothly. The keyword here is partnership - it’s a two-way street and communication and trust are both the foundational aspects before any of the other factors that come into play. As 3PL experts, we’re here to outline 3 main things to look out for when building a successful relationship with your 3PL provider so you can get the most out of the partnership.
Being on the same page is a vital step to take very early on. This means hashing out what is most important for both parties, as well as how it can be accomplished moving forward. Try to leave nothing in your partnership undefined, and if possible, discuss all facets of your shared goals and expectations and put them down on paper in the form of a thorough contract.
The key to mapping out these expectations starts by communicating effectively. Appoint a person who will be the first point of contact, as this will avoid any chances of miscommunication or confusions as a result of wires crossing. This will also come in handy when establishing an escalation procedure - if a customer doesn’t receive a package or their product is damaged, who will handle the situation? Identifying the person who handles such queries should occur before any issues take place, especially if your business is dealing with a high volume of orders. In this context, it is always worth asking how they compensate for potential delays!
A gateway to incentivising the success of your 3PL provider is to establish some success metrics. Firstly, find out what success looks like through the lens of your business. After that, find out what their KPI’s are and how you can work together to achieve the benchmarks you set with each other. It is vital to outline your definitions of success in this relationship, whether that’s your customer satisfaction rate or your number of orders processed per day.
After communicating these KPI’s to your 3PL partner, schedule regular check-ins and touch base every so often. Having regular meetings is a great way to see how you and your logistics partner are living up to your predefined KPI’s. This can also help you build a stronger bond with your partner, as it can help you work together to overcome problems that might crop up in the process. Ultimately, this is a partnership, and there’s power in numbers!
It is worth considering offering your 3PL providers with bonuses for meeting the success metrics you established together. The best partnerships in business are when a win-win situation can be created and this is likely to result in a long-term partnership. After all, when your 3PL provider meets their goals, this directly boosts your business too.
Involving your 3PL provider in your long-term plans will help you get the most out of your partnership together. Any long-term planning around possible changes in volume, acquisitions, marketing, and brand development strategies is good to be had with your 3PL partners. This will help you understand your 3PL partner, and will also help them understand your business too.
Discuss what your future goals are early on. If you are considering a partnership, you most certainly already have a good idea of where you want your company to be in the long-term. Making your 3PL provider aware of these ideas and plans for the future will enable them to create a sustainable plan of action moving forward, which can be developed accordingly for continued success. This bleeds into the fundamental principle on which you build this relationship on, which is the transparency of communication.
By following these three tips as an initial guideline, you will find it much easier to find a 3PL partner you are most suited for. Take it from us! At Granby, we specialise in 3PL services, which includes everything from Contract Packing, Handling & Fulfilment, Warehousing & Distribution, Customer Service, and Digital Services. We consider ourselves to be the home of marketing logistics solutions, and have done so since we were established back in the 1950s! Let us help you connect with your customers - talk to us to learn more about how we could start a partnership together. You can also see a list of the companies we are happy to have long-standing ties with on our homepage, including Selfridges, Harvey Nichols, and Avanti!
Think we could be the partner for you and are interested in working together? Call us or fill in the contact form and we will get the ball rolling!
Call us on 01254 682702 or firstname.lastname@example.org
Granby house, Stanley Street, Blackburn, BB1 3BW