Everything To Know About Third-Party Logistics

Everything To Know About Third-Party Logistics

October 27, 2022

If you're an eCommerce business owner, you know that logistics is the last thing you want to worry about.

And as your eCommerce business grows, you'll likely need to expand your operations. This can be a scary task, but it's made easier with the help of a 3PL provider. They can help you set up new warehouses, manage inventory, and ship orders quickly and efficiently. Plus, they have the experience and expertise to handle any growth you experience. So, if you're ready to level up your business, consider using a 3PL provider.

What Is A 3PL?

A 3PL is a company that helps other companies with their logistics. This can include setting up new warehouses, shipping products, and handling inventory. Third-party logistic suppliers allow eCommerce businesses to scale their operations thanks to their acquired tools and infrastructure that automate retail fulfilment.

The 3PL industry as we know it today can be credited to the Motor Carrier Act of 1980. This act deregulated the trucking industry, which resulted in a steep increase in the number of trucking carriers-- from approximately 20,000 in 1980 to 1.2 million today. Suddenly, a much more fragmented market created an opportunity for third-party companies to offer value-added logistics services.

Who Uses 3PL?

ECommerce businesses of all sizes can benefit from using a 3PL provider. They are beneficial for companies that are growing quickly or expanding their operations. 3PL providers can handle all the logistics for you to focus on other aspects of your business.

What To Outsource To A 3PL Provider?

A 3PL (Third-Party Logistics) is frequently used in outsourced logistics and supply chain management to outsource an eCommerce business shipping and fulfilment services, which can entail:

  • Order fulfilment
  • Transportation
  • Warehousing
  • Materials procurement
  • Inventory management
  • Customs Brokerage
  • Freight audit
  • Payment
  • Shipment tracking

Because 3PL providers offer various services to eCommerce businesses, it's common practice for 3PLs to integrate within a company's warehouse management and transportation operations for an extensive delivery workflow.

Some 3PLs focus on customs brokerage, transportation (both domestically and internationally), and trade compliance. Others design logistics solutions for manufacturers, retailers, eCommerce companies, etc. that include all channels/methods of distribution.

The Third-Party Logistics Order Fulfilment Process

You're not alone if you've ever wondered what goes on inside a 3PL fulfilment centre. Even if you're new to outsourcing shipping or considering working with a 3PL company, the whole process can seem like a mystery.

What does a 3PL's eCommerce warehouse do once a customer orders something from your online store? Let's find out by exploring the process from beginning to end.


A 3PL can't ship orders if it doesn't have any inventory in stock. "Receiving" inventory at a 3PL warehouse refers to accepting and storing an incoming shipment.

3PL Warehousing

3PLs will store your inventory in its fulfilment centres once receiving it. Each SKU has its dedicated storage on a shelf, in a bin, or pallet.

Three different aspects are crucial when looking for a third-party logistics provider (3PL). These include: ensuring they can store your inventory, that their warehouse space can grow with your product line and order volume, and lastly, working with a 3PL who is familiar with your industry.

Please Note: A 3PL is different from an on-demand warehousing company. The latter matches you with available storage space in various warehouses without operating any logistics centres of their own.


Once a customer has placed an order, it is time to start the 3PL fulfilment process. (The first half of this process is referred to as "pick-and-pack fulfilment.") Some 3PLs require that you manually upload orders, which often involves using inefficient spreadsheets, including customers' shipping and order details.

Other 3PLs have technology that, depending on what eCommerce platform or marketplace you use, can directly integrate with it. For example, this type of integration for your fulfilment software would include orders, shipment details, and stock levels, among others, in one place. In other words, the goal is to make shipping a more automated process by bringing all these elements together.

This program creates a fluid process by pushing customers' orders to your third-party logistics company right when they're placed.

Upon receiving an order, your 3PL provider will assign it to their warehouse picking team. The picker is given a list that details the items, quantities, and storage locations within the facility to collect the necessary products.


Once all items in an order have been selected, your third-party logistics provider will securely pack them for shipping using materials that fit your brand preferences and the type of products being shipped.

Some third-party logistics providers will include the packing materials in their fee, while others will charge them as a separate line item.

The 3PL company has plenty of experience with shipping, so they will know how to protect your products through packaging best and to lower the dimensional weight. They will also be able to optimize packages so that you won't have to ship in multiple parts.

Lower dimensional weight means that you'll be paying less for shipping. As a business owner, it's essential to know how to save on logistics costs where possible and using the proper packing materials is one way to do so.

Choosing the right 3PL is essential to ensuring your brand stands out from the rest through things like custom boxes and inserts. Remember that a customer's first experience with your brand will often be when they receive their purchase, so make sure it's a good one!


The next logistics step is shipping your order. Most 3PLs will manage the printing of shipping labels and respective documentation. Some warehouses have relationships with certain carriers, while others compare rates from several shippers. The latter provides clients with more affordable pricing depending on each customer's delivery speed.

Depending on the 3PL's partnerships and policies, as well

as the shipping options are offered by the client and selected by the customer, carriers such as DHL, USPS, or UPS will pick up orders from warehouses to ship.

After an order has been shipped, 3PLs that have integrated the mentioned technology will automatically update merchants on the shipment's progress.


Many 3PLs also offer return processing services. For example, if a customer wishes to return an order, they can ship it back to your 3PL, which will process the return, accordingly, depending on their policies and preferences.

Having your 3PL handle return shipping labels makes the process more convenient for you and your customers. Not only will Returns be processed in-house quickly, but customers can easily track the status of their order, removing any guesswork.

Third-party logistics providers offer various services to help businesses automate and optimize their shipping process. By choosing the right 3PL, you can save on packing and shipping costs and returns processing. Regarding shipping, having a partner who knows the ropes is essential to uphold your brand's reputation.

Choosing Your Third-Party Logistics (3PL) Provider

If you're looking for a third-party logistics provider who can help you streamline your shipping process, look no further than UK Pick & Pack.

We offer various services that help businesses of all sizes save on packing and shipping costs and return processing.

Our logistics team has years of experience in the shipping industry, so we know how to protect your products through packaging best and how to make the dimensional weight lower. We also have partnerships with several carriers, so you can choose the delivery speed that best fits your needs.

Contact our team today to find out more.

UK Pick & Pack is a trading division of Sussex Transport, a British born and family owned, road haulage and warehousing organisation based near Brighton in beautiful West Sussex.

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UK Pick & Pack
Downsview House,
91 Marlborough Road,
Lancing Business Park,
Lancing, West Sussex,
BN15 8SU