(Written in Australian English)

6 Reasons To Hire A 3PL

If you are a manufacturer, e-commerce entrepreneur, dropshipper, or Amazon FBA seller, then a 3PL partner can unburden all your logistics and fulfilment worries. A third-party logistics (3PL) provider like ABC offers a broad range of such services for these businesses. Here, we will cover six main reasons to hire a 3PL.

1. Efficient Supply chain

The 3PLs have a solid inbound, outbound, and reverse logistics network to streamline the supply chain. 

In the case of manufacturing companies, a 3PL covers supply chain operations from bringing in the raw material to storing the finished product in the 3PL warehouse.  A 3PL can even go further to deliver the product to the end customer.

For E-commerce and retail entrepreneurs, 3PL services start with carrying their products to the 3PL warehouse. Then pack and deliver the products, as and when required, to the end customer through their network, and their role ends with returns management.

 

2. Complete Inventory management

If the company handles inventory management, storage, and handling, it demands a huge infrastructure expenditure. Further, routine fixed expenses for store administration, maintenance, packing, and shipping arrangements will be there. 

A 3PL can take away all these headaches with its expertise and advanced warehouse management solutions, and you can focus on the actual business. 3PL will keep your inventory safe with their latest technological and professional expertise. Further, the 3PL provides online inventory tracking and stock updation facilities, so you always have control of the situation. Just hand over the inventory to them and be carefree.

 

3. Automated Order fulfilment

In the case of E-commerce & dropshipping companies, when an order comes on their website, it is forwarded to the 3PL facility automatically. This triggers the order fulfilment process at their warehouse. 

The pickers gather goods from the warehouse per the packing list and pack them into appropriate boxes or bags. Then, the item is labelled and shipped with relevant documentation to the end customer.

Similar is the case of stock fulfilment at the retail outlets. Whenever the stock quantities fall below the minimum levels decided by the company, the software immediately sends a requisition for replenishment.

 

4. Returns management

3PL takes responsibility for the goods returns management also. Returns management is one of the most important aspects of any business. A clear return policy develops confidence in the customers to buy from your company or e-store. 

However, the returns or exchange process is very time-consuming and demanding, as you have to deal with an angry customer with an eye on the company’s margins. Here also, 3PL comes to your rescue and keeps you free of all such tasks.

Their highly trained customer care team will deal with the customer. In the case of return or exchange, 3PL staff will inspect the returned merchandise, process the refunds, or ship out a new item as required. Then the returned items are given the final treatment, maybe restocking, discarding, sending back to the manufacturer, or recycling. 

 

5. Time and cost-saving

3PLs manage the logistics and warehouse operations in bulk in routine and have vast infrastructure and expertise in this particular field. A 3PL being connected with many shipping, logistics, and related companies, can get such bulk deals and discounts which e-commerce companies can never expect to get. 

Similarly, 3PL saves a lot of time by picking, packing, and shipping the orders. Otherwise, the company would always remain busy with sorting and packing activities.

Further, when e-commerce companies deal with reverse logistics on their own, sometimes, because of high shipping charges compared to the value of the goods, companies even have to leave the product with the customer. On the other hand, a 3PL easily handles such situations because of their regular routes and tie-ups. So, good reverse logistics can even reduce costs.

 

6. Scalability

When entrepreneurs handle the inventory or logistics, then, while planning the scaling-up of operations, the fingers are always crossed. The reason is the high investments needed in the infrastructure and related maintenance costs to run the business at that level. The possibility of sunk cost in case of failure always haunts them.

On the other hand, while dealing with 3PLS, the company can quickly scale up or scale down the business as per the company’s temporary, seasonal or market demands. With a 3PL as a partner, e-commerce operators need not think about these aspects.

Conclusion

So, if you are a manufacturer, e-commerce entrepreneur, dropshipper, or Amazon FBA seller, then you have all valid reasons to go ahead with a 3PL partner like ABC. Their efficient warehousing management and product delivery, lower costs, and high customer satisfaction lead to a successful business in the long run.

 

(Written in US Engish)

How to start your own Dropshipping business

If you have a dream of starting your E-Commerce business but do not have enough money to invest or can not leave your 9-5 job, then start with dropshipping.

 

Image by Animation Production Company from pixabay.com

What is Dropshipping?

Dropshipping is an E-Commerce model for retail fulfillment that does not require a business to keep products in stock. Instead, the online store attracts customers, sells the product, and passes on the order to wholesalers. The wholesaler supplies & ships the product. Thus the dropshipper need not invest in inventory or a warehouse.

 

Starting a dropshipping store is so simple that you can start with it even while working 9-5! As you grow, you can transition into working full-time on your dropshipping business as cash flow and profitability allow.

 

How to start a Dropshipping store?

 

1. Choose a niche

First, you have to choose a profitable niche. Now, what is a profitable niche? A Niche is profitable only when the product is in demand. It is easier to fulfill demand than to create it. And how will you know which product is in demand? The market is already full of products. Well, there are a lot of online tools available for this purpose:

 

a) Facebook Audience Insights

Facebook is the largest social media network in the world. Facebook Audience Insights is a great product research tool for finding a trending product. It is a free tool that helps you learn more about your audience. It aggregates information about Facebook users' Demographics, likes, location, language, activities, and much more.

  

b) Google Keyword Planner & Google Trends

The best way to measure demand for an item online is to see how many people are looking for it using a search engine like Google. Just type in a word or phrase, and the tool tells you how many people are searching for it every month.

 

You can use Google Trends for more detailed insights like Geographical concentration, seasonality, search intent over time, etc. 

 

 2. Perform competitor product research 

Competitor analysis is a must in the dropshipping business. Know your competitors and their products. What makes them successful? How do they do it? Try to know their strengths and weaknesses, their strategy and objectives. Look at their customer reviews.

 

What are their best sellers, and for which keywords do they rank? On which social media channels are they good? There are a lot of Competitor Analysis Tools also for in-depth analysis.

 

 3. Decide a business structure

Available business structures may differ country-wise. Commonly available options are LLC, LLP, Partnerships, Ltd.co., C-corp, S-corp, Sole proprietorship, etc.

 

However, Sole proprietorship is considered the simplest one, but it may be a bit challenging if a judge rules a case against your business. In the case of Sole proprietorship, there is no personal liability protection. So take legal advice and choose it carefully.

 

4. Tax registration requirements

You will have to apply for Income tax, sales tax, and other local authority registrations as per your country's requirements. So it is advised to get a legal opinion from experts in your area for proper compliance.

 

As some legal requirements may differ country-wise, it is not feasible to mention different details here.

 

5. Separate Bank account and Credit card

In the case of Sole proprietorship also, you may like to keep your business and personal finances separate. The best way to do that is by opening up new accounts in your business name.

 

Similarly, you must use a separate credit card for this dropshipping business for routine purchasing. It will help you maintain cleaner accounts and get better rewards from credit card companies.

 

6. Choosing the right platform 

Choosing the right dropshipping platform plays a vital role in the success of your business. Some of the available choices are: 

a) Amazon, eBay, and other marketplaces

You can directly start your store on any established marketplace like Amazon or eBay. While selling on established marketplaces, you benefit from their infrastructure and traffic, but the customization and personal branding would be missing here. Anybody shopping from your store will broadly remember the names of the marketplace only, like Amazon or eBay.

 

Further, the marketplace could lack essential features like shipment tracking, fulfillment monitoring, or website integration. Or it may limit the number of products you can offer. 

b) Hosted platforms like Shopify, Wix, and Woocommerce

If you want to set up a store with just a few clicks and start selling products, then well-established dropshipping platforms like Shopify, Wix, Woocommerce, etc. will be great. 

 

Out of these stores, Shopify is the largest E-Commerce platform, being used by more than 1 million E-commerce and Dropshipping stores in 175 countries. It is versatile enough to be used by SMBs and enterprise-level companies to set up and manage online stores.

 

The best part of having your own store is personal branding. Unlike selling on marketplaces like Amazon and eBay, if a customer buys from your website, they will mention your brand name or store name while referring to your products in their circle. However, in the case of your own store, you need to invest time and effort in bringing traffic to your website. 

c) Self-hosted website

If you have enough resources, then you always have the option to build a website from scratch or set up a store as per your requirements. Remember that you’ll have to do everything from scratch, including coding part, and designing. 

Further, a technical team would always be required to maintain the site. However, you can manually set up plugins and other integrations with a self-hosted platform and customize it per your taste. A one-time setup cost is there in self-hosted sites, but with the increase in the business size, you need not cough out hefty monthly charges like in the case of hosted platforms.

 

Conclusion

If you are a newbie, the best route would be to start with hosted sites to get a taste of it. Choose one out of all available ready-made options! After earning money through this and also gaining experience from this business, expand as per requirement. The marketplace option can even go along with your self-hosted website to get the benefit of their traffic.