A study at the conclusion of the peak shopping season 2020 revealed that 54% of retailers plan to outsource some or all of their digital operations. That number may be even higher now with preparations for this year’s peak season well underway. But picking the best from among many ecommerce 3PLs – or even an adequate one – is not as straightforward as it might seem.
The explosion of ecommerce has attracted a range of outsourcing providers who execute many routine operations. Providers are offering support for everything from staffing services to order fulfillment to returns processing, and everything in between – the requirements for an ecommerce operation are extensive. But just because a 3PL claims to have what a retailer lacks does not automatically mean they’re a good fit for the job.
With the next peak season fast approaching, vetting prospective ecommerce 3PLs should focus on their ability to execute under peak conditions. While some may be good at a few aspects of ecommerce operations, the ability to scale up those operations is crucial. And the ability to scale end-to-end is a rare quality indeed.
The outsourcers who can truly do it all according to each brand’s requirements are the real pros. 3PLs that can’t do it all – at scale – are just posers.
Quality over Quantity
Most retailers staring at the challenges of peak demand tend to focus primarily on the sheer volume of potential order-handling. But, as the saying goes, the devil is in the details.
Posers, likewise, are focused on the volume of transactions they can handle. The promises they make focus on the quantity of orders, while they disregard the requirements for a quality customer experience.
Among ecommerce 3PLs, pros are organized to deliver the experience a retailer’s customers expect for every single order, no matter how many come through. This means the workflow is properly provisioned and staffed to support attention to details.
Sometimes this is as straightforward as supplementing capabilities the retailer already has in place. But often it means an end-to-end operation that delivers on promises made for the total online shopping experience, not just “doing their part” while the rest falters or fails. This comprehensive approach offers more protection for the brand while making the entire process more efficient.
Pros offering end-to-end support deliver services supporting all of the key elements of top-tier ecommerce: fulfillment, payment processing, customer service and so forth.
Fulfilling Orders
One of the ways posers seek to make good on their claims is by fitting the retailer’s services into the 3PL’s own “boxed” solution. This is especially true for fulfillment operations where, again, the focus prioritizes quantity over quality.
Posers set up their fulfillment processes on their systems to work in the way that best fits their operations. This is in sharp contrast with pros who can adapt their systems to meet client requirements or even integrate with client systems. This adaptability is critical for true omnichannel fulfillment models. It allows retailers to deliver ultimate customer convenience. Besides assuring home deliveries are on-brand, tight systems integration enables support for the full range of fulfillment methods such as buy online pick up in-store (BOPIS) and curbside pickup, which have grown in popularity since the pandemic.
Most importantly, a true 3PL pro can scale up to support peak volume as needed while maintaining quality fulfillment practices. This can include details like custom branded packaging (i.e. how merchandise is wrapped and oriented in the shipping package), support for personalization services such as product engraving, and even right-sizing the outer package for a more “custom” experience (with less waste).
Posers may promise peak demand fulfillment, but can they scale to deliver peak volume for all their clients all at once, all year round? It’s a key question retailers need to ask before signing up for the season.
Putting Customers First
Then there is the matter of ecommerce business affairs. While harder to quantify, this is where customers most acutely feel the character of a brand.
Take the issue of fraud management. Posers approach this with the promise to eliminate every bit of fraud possible, assuming that is what their clients want to hear. (And for some retailers, that really is the one goal.) But overly aggressive fraud management can inadvertently alienate loyal customers. Pros take the time to understand the demographics of a brand’s shoppers and their buying patterns to manage fraud intelligently.
When it comes to customer disputes, posers treat them like an adversarial engagement. While a 3PL might claim to be protecting the brand, it comes at the expense of that brand’s reputation. Though pros have scripts to help guide agents through a disgruntled customer call, the high-quality agents are trained to take the time required to achieve a positive outcome for everyone, especially the customer.
Returns are another area ripe for missteps. Posers make returns difficult, again professing to be protecting the retailer. Pros use judgement to make the returns process painless for the customer while still meeting the retailer’s business requirements.
Find Your Ecommerce 3PL Pro
As retailers gear up for the season ahead, they may see ecommerce 3PLs as a partial or complete resource. The growth of ecommerce has attracted a host of service providers who claim to know omnichannel operations. But retailers need to probe the details of these posers’ capabilities and operating principles before trusting them with their brand and their customers.
Kamran Iqbal is a Commerce Strategist with PFS