How 3PLs Set Retailers Up for Success in 2025
Reliable and personalized order fulfillment significantly improves retail operations, reduces costs, and creates satisfied and loyal customers. But great order fulfillment isn’t easy. Often, brands struggle with high warehousing and transportation costs and complex supply chains, making it difficult to scale in-house fulfillment effectively while delivering consistent customer service.
That’s why 57% of eCommerce companies are outsourcing some or all of their fulfillment processes—up from just 29% in 2020. For many growing brands in 2025, it’s more important than ever to reassess their fulfillment processes and determine the benefits of a trusted third-party logistics (3PL) provider to streamline operations, balance costs, and meet customers’ high expectations.
What is a 3PL?
“3PL” stands for Third-Party Logistics and refers to the outsourcing of logistics and supply chain management functions to specialized companies that are separate from the businesses they serve.
3PL providers partner with retailers and provide a wide range of services that can include transportation, warehousing, inventory management, order fulfillment, packaging, freight forwarding, and customs brokerage, among others. By leveraging the expertise and resources of 3PL providers, businesses can focus on their core competencies while benefiting from the specialized knowledge, infrastructure, and technology offered by these external logistics partners.
The Benefits of a Third-Party Logistics Provider
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.
Here are some of the benefits created by partnering with 3PLs:
- Streamlined Operations and Cost Savings: Retailers and brands can streamline operations and achieve significant cost savings by partnering with a 3PL. 3PLs provide expertise, infrastructure, and efficient operations designed to reduce overall transportation, warehousing, inventory, and shipping costs. Organizations can tap into economies of scale through established logistics networks, as well as access cutting-edge technologies.
- Flexibility and Scalability: Businesses’ logistics needs will change as they grow and evolve. 3PLs are equipped to handle demand fluctuations, seasonal spikes, and sudden supply chain disruptions. They can scale to meet business needs, market dynamics, and customer expectations.
- Supply Chain Visibility and Analytics: 3PLs provide visibility and key insights into supply chains with advanced tracking systems, real-time data analytics, and robust reporting capabilities. And many leading 3PLs integrate new technologies like machine learning and GenAI to further support their retail partners. Supply chain transparency means better decision-making and continuous improvement.
- Risk Mitigation and Expertise: Global supply chains are complex and prone to constant disruption. 3PLs mitigate risks and ensure compliance with relevant regulations. Their extensive industry knowledge and risk management protocols mean more resilient supply chains.
What to Look for in a 3PL
There are many things to consider when selecting a 3PL. What should retailers look for when beginning the process? It helps to ask a series of questions.
- How experienced is the 3PL in my industry? Assess the 3PL’s expertise and experience in your specific industry or niche. An experienced 3PL will understand the unique challenges and requirements of your industry, then tailor solutions accordingly.
- What customers does the 3PL serve? Request customer references, testimonials, or case studies. Research the 3PL’s reputation in the industry. Look for feedback on their reliability and responsiveness.
- What range of services does the 3PL offer? Evaluate the range of services offered. Consider whether they offer the specific logistics functions you require, like transportation, warehousing, inventory management, fulfillment, or value-added services.
- How is the 3PL’s network designed, and what geographies does it cover? Consider the geographic reach and available network offered by the 3PL. Discuss optimal warehouse locations, transportation routes, and distribution capabilities.
- What technology systems does the 3PL offer? Determine what technology and automation are available. Look for advanced logistics software, warehouse management systems, real-time inventory visibility, and reporting capabilities. Robust technology solutions improve supply chain visibility and provide critical data for decision-making.
- How scalable and flexible is the 3PL? Assess the 3PL’s ability to scale operations up or down depending on demand. Determine whether they have the resources and infrastructure necessary to handle order volumes, maintain quality during seasonal peaks, and scale for future growth.
- What is the 3PL’s cost structure and pricing model? Understand how their fees are calculated, including any additional charges for value-added services or peak season surcharges. Determine how transparent they are about pricing and billing practices to avoid unexpected costs.
- How does the 3PL communicate? Consider the 3PL’s communication channels. Look for a provider who offers open lines of communication and provides regular updates. Determine whether the company offers dedicated customer support.
- How does the 3PL maintain compliance and security? Verify that the 3PL provider adheres to necessary regulatory compliance, such as customs regulations, industry standards, and security protocols. Assess their certifications, licenses, and security measures to ensure the safety and integrity of your products.
A 3PL should create a partnership mindset. Partnership means mutual support and an investment in each other’s successes. A partnership mindset means the 3PL will seek to add value above and beyond SLAs to help retailers grow sales and improve customer experience for the long term.
The Radial Difference
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 works with retailers 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 brands to compete and meet customer expectations. We understand that every retailer is unique, and we offer tailored solutions for your growing needs. Radial also provides high-touch services that empower retailers to keep their brand promises.
Often, 3PLs serve as transactional vendors. We don’t. Our experts will partner with you to develop a successful strategy to optimize your eCommerce operations and customer experience. Radial’s solutions are designed to scale seamlessly with your business, allowing you to adapt to changing market conditions and customer expectations. Whether you’re experiencing rapid growth, seasonal fluctuations, or unforeseen challenges, our scalable infrastructure and flexible solutions mean you can expect robust performance and results.
Learn how Radial can help you with eCommerce fulfillment.
