A New Way to Think About Third-Party Logistics Services

July 21, 2021

You’ve created a unique product, built some buzz about it, and are now scoring so many orders that it’s getting hard to keep up. You need help, especially if you’re going to meet holiday rushes.

Traditional Third Party Logistics Services (3PLs)

You might be attracted to the idea of a traditional third-party logistics (3PL) services. These companies run networks of giant warehouses. Their proposition: All you need to do is send your products in advance, and they will pack and ship them to your customers as orders come in. Fulfillment by Amazon offers this service to Amazon sellers, and there are dozens of other 3PL companies offering to work with companies that sell through other channels, such as Etsy and Shopify.

After your business really takes off and you are shipping truckloads of products each week, one of these third party logistics providers may be exactly what you need. For smaller companies, however, there are better options you should be considering. Primary among them? Shared warehouse space and more specialized 3PL services that offer the control they need at a price they can afford.

Here are three questions that any growing business should ask about a logistics solution:

  • Can we visit the facility and meet the people handling our products? Traditional third party logistics services companies set up warehouses in low population areas adjacent to Interstate highways. In other words, far from where you live and work. Even if you travel to the warehouse, these companies aren’t set up to let you inspect your inventory and show the staff how to handle it.
  • Are the fees going to add up? You could pay a traditional 3PL company fees for setting up your account,  receiving your inventory, storing it, picking, packing, and shipping an order, and handling returns. Many small businesses find the total bill is significantly higher than they expected.
  • Will they give our products special attention? Most small retailers understand they aren’t just selling a product, they are delivering an experience that starts with an attractive and interesting unboxing. It’s very difficult to get the high-speed assembly lines at a large 3PL facility to attend to the special packaging needs of smaller businesses.

A new approach

“A lot of small businesses find third party logistics companies to be a black box,” explains Paul D'Arrigo, co-founder of Saltbox, a shared warehouse provider that caters to smaller e-commerce companies. “They are not set up for businesses that ship hundreds, not thousands, of orders a week. Clients come to us because their 3PL provider kept making mistakes and wouldn’t even return a phone call to discuss it.”

What many small businesses need, then, is help with shipping where they can still supervise the process. D’Arrigo says there are two basic approaches that work especially well for growing entrepreneurs.

  1. Shared Warehouse Space. This is best for entrepreneurs who want to stay closely involved in the fulfillment process. Providers like Saltbox offer companies their own space in a larger facility with the equipment and services a growing business needs to assemble, store, and ship its products. And no matter how much your company grows, you can rely on the on-demand workforce to kit and pack each order exactly the way you want them to.
  1. Third party logistics services designed for small companies. This is the approach to take if you want to work with your logistics provider to get things just right then set the shipping on autopilot. For example, Saltbox is rolling out a new approach to third-party logistics that operates out of its shared facilities, starting in Dallas. With no minimum fees, it’s designed for growing small businesses. And entrepreneurs can always visit the operation and train the people handling their products. Eventually, Saltbox will have its own 3PL facilities around the country, allowing even the smallest companies to combine a custom unboxing experience with fast shipping.

After all, you’ve come this far by delighting your customers—you don’t want to let them down now.

About Saltbox

Saltbox is the Modern Warehouse for digital commerce companies. With our purpose-built network of flexible warehouses in major metropolitan areas across the country (currently open in Dallas, Seattle and Atlanta with many more about to open this year), we are powering the ecommerce economy and the next generation of entrepreneurs by democratizing access to essential operations and logistics infrastructure. From flexible and smartly designed warehouse and office suites to on-demand services like our Elastic Workforce, Fulfillment, and even photography studios Saltbox solves some of the most critical challenges ecommerce entrepreneurs face when starting, growing, and scaling their businesses.

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