For most businesses, times of growth equate to exponential – and exciting – gains. Your consumer base expands, your profitability soars, and your brand awareness surges. As no one will argue, these are all things every business strives to attain. But with business growth comes a myriad of challenges – especially when developing the infrastructure needed to support it. As they scale, many businesses look for a 3PL warehousing facility. Let’s explore the signs that your business may be ready to engage a 3PL facility.
Is Your Business Ready for a 3PL Warehousing Facility?
For your logistics picture, growth can translate into the need for an entirely new strategy – from forecasting stock levels to streamlining order fulfillment and hiring specialized staff. The downside, however, is these needs require you to shift your focus away from big-picture initiatives. And oftentimes, businesses endeavor to manage logistics in-house, only to discover it’s a massive undertaking and detrimental to their bottom line.
That’s why outsourcing your logistics needs to a 3PL warehousing facility is imperative to success during times of growth. Here are four signs that your business is ready to partner with a 3PL warehousing facility and the benefits you can enjoy as a result.
Increasing Costs
There’s a direct correlation between business growth and an increase in costs. To meet the rising needs that growth brings, your business may need to acquire specialized staff, find new warehousing space, purchase new machinery, and more – all just to keep up with the increase in demand. When the cost of growth begins to chip away at your profitability, it’s time to invest in a 3PL warehousing facility.
While every business anticipates and hopes for growth, a company often needs help to properly predict the rate at which this happens. This is where a 3PL warehousing facility can come in handy. You can leverage their technology, resources, and proven systems to help streamline your production and drive a positive customer experience. This is a massive weight (and potential headache) taken off your shoulders and entrusted into the hands of a 3PL warehousing facility expert.
Dissatisfied Customers
You cannot thrive as a business if you leave a swarm of dissatisfied customers in your wake.
The goal is to build customer loyalty and repeat business, not damage those relationships. Strengthening customer loyalty comes down to the quality and consistency of your fulfillment process, as well as your ability to deliver products accurately and on time.
Increased sales = increased work. And, let’s face it, this rise in demand can slow down production and cause product delays, stock-outs, and delivery errors without the proper infrastructure in place. When your brand fails to deliver on its promises, customers will not shy away from hopping online and telling the world about it. Whether it’s a Google review or a social media post, negative customer feedback will tarnish your brand’s reputation and cause revenue to decline quickly. There are two ways to avoid this. Either bring on more employees, tools, and systems to alleviate the influx in demand or utilize a 3PL warehousing facility to handle those needs for you.
Overworked Employees
Oftentimes, employees will feel the pressure of an increased workload. And let’s be honest, today’s employees will not hesitate to express their displeasure over the mounting responsibility and high demand. In fact, the Mayo Clinic has documented that overwhelmed employees can often become cynical at their jobs, and as a result, productivity can decrease – adding more stress to your bottom line than there already is. Bringing on a 3PL warehousing facility can temper this extra workload and help ensure your workforce maximizes productivity.
A Decline in Inventory Management
With a bigger demand comes the need to grow your inventory. If you don’t have the warehouse space to hold all of the inventory you need to keep up with the increased demand, it might be time to look into a 3PL warehousing facility. Expanding your inventory space can lead to higher costs, erroneous inventory management, and failure to comply with safety regulations. With a 3PL warehousing facility on your side, however, you can optimize your storage space, effectively manage inventory, and leverage predictive analytics to maintain stock levels.
What to Do Before Reaching Out to a 3PL Warehousing Facility
Before connecting with a third-party logistics provider, there’s a little prep work to do on your end to maximize your success. Evaluating your needs as a business will ensure you find a 3PL warehousing facility equipped with the solutions needed to support your business initiatives. Defining your needs will also help the 3PL warehousing facility customize a strategy that best aligns with your goals. Here are a few questions to get started:
- Is growth hindering the upward trajectory of my business?
- Is human error and fulfillment issues negatively impacting the customer experience?
- Are we seeing an uptick in negative reviews?
- Are we getting bogged down by the day-to-day minutia of the logistics workflow instead of focusing on high-level activities, like sales and marketing?
What Are Your Expectations?
Having a 3PL warehousing facility’s expertise and proven systems on your side can bolster your logistics strategy's long-term success. At Smart Warehousing, we provide comprehensive supply chain management solutions designed to help fuel efficiency, decrease costs, and drive a positive customer experience. As the go-to 3PL warehousing facility for e-commerce companies, we can help craft a customized solution to move your business forward. To learn more about how the Smart Warehousing team can help your business with all things logistics, contact us today.