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Retail Insights

Matthew Carpentieri

For any business, scaling up represents an exciting period that can come with growing pains. As you expand your business and the volume of orders grows, managing your supply chain and keeping up with order fulfillment require more time, expertise, and resources to get right. 

Fulfillment and logistics can easily be one of the highest-priced and most time-consuming line items for any business. This is where third-party logistics can save you.

A third-party logistics company (3PL) is an organization that handles outsourced inventory management, fulfillment, warehousing, distribution services and more. Working with a 3PL enables businesses to tap into infrastructure and technologies that they would not have access to on their own, ultimately reducing friction and delivering value to customers. D2C ecommerce businesses like Warby Parker, Casper, and Barkbox have seen success scaling their businesses with the help of 3PLs.

Here are just a few benefits of working with a 3PL, and how it can provide the support to scale successfully. 

  • Better shipping rates.
Here is a secret you may not have known: volume equals discounts. 3PL companies leverage the volume of orders they handle to negotiate better carrier rates, pickup times, and dimensional factors. As a solo brand, you may not have the bargaining power you need to receive discounted rates. Standing together with many other brands, however, can make your voice much louder. It’s proven that brands that partner with a 3PL provider are in a position to be more profitable per order.

 

  • Decreased shipping time.
Today, every brand has to compete with Amazon Prime’s two-day shipping—which means getting packages out to customers quickly is essential. But it may be difficult to justify the expense of building a national footprint of warehouses to house your products. Utilizing a fulfillment company that already has a national footprint in place, however, enables you to reach your end consumer in a more timely, cost-effective manner. 

 

  • Real-time transparency.
Inventory management in real time enables brands to accurately replenish inventory, while providing customers real-time order status updates. Tier 1 WMS data is much more granular when activity is tracked through points of scan, as is the case with a paperless warehouse, than it would be if processed through batched shipping. In turn, this provides greater transparency on an order level.

 

  • Strategic partnership networks.  

3PLs often come with a built-in partnership ecosystem offering integrated solutions that would otherwise be inaccessible. Tapping into these partnerships gives you access to solutions, tools, and offers that are tailor-made for your business. 

These can include things like payments and BNPL solutions such as Zip, systems integrators and marketing agencies, ERP systems, MarTech solutions, tax services, and so much more. Tapping into a pre-built network makes it easier to vet and select the right solutions for your business.

As you grow, identifying the biggest opportunities to streamline your business is step one to scaling successfully. Picking the right partners is step two. 

Whether you are a small business or large enterprise, any company can benefit from the additional help afforded by a 3PL. While there’s no formula behind achieving scale, there are plenty of smart ways to make your business more efficient so you can focus on higher ROI activities that enable transformational growth for your business. 

This article was contributed by Matthew Carpentieri at Ruby Has Fulfillment.  Ruby Has is a major ecommerce fulfillment provider for fast-growing direct-to-consumer brands and retailers, fulfilling their brand promises with precision, customization and excellence at scale. Where others “break” and fail at scale, Ruby Has shines. To learn more about Ruby Has, reach out to the Zip team or contact Ruby Has directly.

Matthew Carpentieri
Matthew Carpentieri

Matthew Carpentieri is the VP of Global Partnerships at Ruby Has — A 3PL has a responsibility to prospects and customers, to provide value through partnerships and integrations that can assist their brand’s growth and maturation. As VP of Global Partnerships, Matthew has accomplished exactly that with partnership solutions focused on ERP, OMS/IMS, RMA, EDI, Custom Packaging, Financial Technology, Routing Optimization, Marketing Agencies and more.