Frustrated Customers? Why It Might Be Time to Switch 3PLs 

Retailers have many priorities this year, but there’s one thing they cannot afford to miss: high customer expectations. Customers have high expectations for every element of their online shopping experiences: 

It’s worth focusing on great customer experiences. Companies that focus on improving customer experience can realize an 80% increase in profit compared to those that don’t. And leading retailers differentiate themselves by focusing on great customer experiences across the eCommerce fulfillment process—from online orders through to great delivery.  

Reliable and personalized order fulfillment can significantly enhance customer satisfaction. But great order fulfillment is difficult. Each customer’s experience hinges on the efficiency of order fulfillment, and they judge their experience based on whether they receive their items on time and without issues. For many brands, that means seeking and selecting a trusted third-party logistics (3PL) provider to streamline operations, balance costs, and meet customers’ high expectations. 

It’s no surprise that retailers frequently seek third-party logistics partners to deliver great customer experiences. Variable order volumes, high warehousing and transportation costs, lack of automation, and complex supply chains make scaling in-house fulfillment extremely difficult. Now, 57% of eCommerce companies are outsourcing some or all of their fulfillment processes—up from just 29% in 2020. 

Outsourced eCommerce fulfillment allows brands to focus on developing products and scaling core competencies, while their logistics partners manage warehousing and distribution, order processing, inventory management, and shipping. 

We are in a new eCommerce era. Retailers must be responsive, flexible, and completely focused on great customer experiences to beat the competition. And not every eCommerce fulfillment partner has the right balance of speed, flexibility, resources, or experience to meet the unique needs of every retailer. That means supply chain leaders must make the tough decision to switch 3PLs when previous partners no longer keep pace with business demands.  

Here are five signs that a retailer should reassess and potentially switch logistics providers. 

Orders take too long and cost too much to get to your customers. 

This primarily occurs when fulfillment providers don’t have enough distribution centers or fulfillment locations within a 2–3-day proximity of areas with high customer demand. Customers expect fast deliveries. Only 26% of consumers have the patience to wait a week or more for a package to arrive. The further a 3PL ships orders, the greater the cost for you—and the higher likelihood of frustrated customers. 

Look for eCommerce fulfillment providers that have the size, infrastructure, flexibility, and growth strategy that mirrors or outpaces your own. A 3PL should take the time to understand your current needs and future roadmap, as well as address contingencies like supply chain disruptions and demand spikes.  

A provider misses KPIs during seasonal peaks. 

If your current 3PL missed key performance indicators (KPIs) and struggled to fulfill orders during seasonal peaks, it is likely time to reassess whether they can scale to meet your needs. Your 3PL should be able to seamlessly scale to handle high volumes. And they should be able to flexibly scale down during slow periods. Look for a 3PL that openly discusses how they will scale via automation, facility capacity, operational efficiency, and seasonal hiring. That way, they can ensure customers have positive shopping experiences and receive their orders on time. 

They offer the lowest cost option but compromise quality. 

Your 3PL represents your brand first and foremost. There’s no margin of error when demand spikes and customers expect deliveries. It might be tempting to go with a low-cost option, but it can lead to the risk of compromised quality. 3PLs that rely on low costs to attract customers can affect operations and delivery, leading to unhappy customers and lost revenue. 

Available technology solutions do not deliver results. 

There is a lot of excitement around artificial intelligence (AI) and machine learning (ML) advancements—and many technology vendors are using the term AI in their product marketing. There are technology solutions that do indeed leverage real productivity enhancements based on AI and ML, but many applications are still immature. If your 3PL promised that its technology would deliver certain advantages and you are not experiencing those benefits, you may need to find a provider that has a solid technology strategy with proven results.  

Look for a 3PL that offers and uses technology that produces the results you need now – with an eye on future innovation. They should leverage solid, proven solutions that yield real-time inventory visibility, a robust, easy-to-integrate order management platform, and reporting that delivers insights to make crucial decisions. 

They are not prepared for supply chain disruptions. 

Supply chain disruptions are striking organizations with increasing speed. On average, disruptions lasting a month or longer occur every 3.7 years. Whether it’s geopolitical disruption or a natural disaster, your supply chain partner should be prepared to proactively respond and mitigate risks.  

Retailers can respond by optimizing fulfillment operations, reassessing existing networks, and preparing communication plans for customers. And they need 3PL partners that can move quickly and act flexibly whenever new disruptions occur. 

Ultimately, retailers will need to seek a 3PL partner that best meets their evolving needs and growth strategies. The 3PL should hold a partnership mindset and add long-term value for both the retailer and their customers.  

For many leading brands, that partner is Radial. 

Radial leverages a partnership mindset to create seamless logistics solutions designed to delight customers. Radial’s 30+ years of experience, expertise with efficient order fulfillment, and innovative payment solutions position retailers to compete and meet customer expectations.  We understand that every retailer is unique, and we offer tailored solutions for your growing needs.  

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