For ecommerce businesses, one of their most important business partners will be with their 3PL provider (or fulfillment partner). Just because that relationship is important, doesn’t mean it’s easy to maintain for all parties involved. In fact, 45% of executives polled stated that their biggest challenge was keeping strategic partnerships active and mutually rewarding.
As a 3PL fulfillment partner based in China, EcommOps has spent years implementing strategies with our clients to make sure our partnership is beneficial to both parties. Below, we’ll talk about exactly what 3PL providers are, and what you can do to make sure your business gets the best benefits possible from a 3PL partnership.
What is 3PL?
3PL is short for “third-party logistics,” which describes a strategy where a business allows its distribution needs to be managed by an outside company. So, a 3PL provider is a business that provides distribution services for another business. For example, EcommOps is a 3PL provider, and we help businesses source, receive, and manage inventory based on consumer demand.
Sometimes, 3PLs are categorized based on where they operate. For example, EcommOps is a China 3PL provider, because our operations are based in China. The specific labels can help businesses find a provider that’s good fit for their business (for example, you likely wouldn’t want a China 3PL if your factory is based in Europe).
How to Optimize Your Partnership with a 3PL in China?
Since EcommOps is a China 3PL, we know what businesses need to do to get the most out of a partnership with a China 3PL. Take a look at the best steps to follow to make sure that your relationship with a China fulfillment partner starts, and remains, mutually beneficial.
Plan What Services You Need from a China 3PL
When you know what specific services you need from a China 3PL, it sets the foundation for a healthy relationship with a fulfillment provider. If you pick a provider at random and then try to decide what services you need them to provide, it can slow down progress, frustrate your China 3PL, and can give the impression that you’re going to end up being a difficult customer.
Knowing what you need will also prevent you from wasting time on potential fulfillment providers that just don’t offer the services you need. It will shorten your search time, and it will make it far more likely that you find a China 3PL that’s positioned to be an excellent partner.
Choose the China 3PL that Best Matches Your Needs
After you’re sure what services you need, then it’s time to find a China 3PL that is a great match for your needs. Ideally, the fulfillment partner you choose will be one that specializes in the specific services that you need.
Not all fulfillment providers will offer all services, and low-quality providers may stretch the truth or attempt to offer a service that they typically don’t in order to win you as a customer. To avoid this, take time to really research providers and make sure you have a solid understanding of what they offer before you approach them.
Establish a System that Manages Incoming and Outgoing Shipments
Once you’ve chosen a China 3PL, you need to work with them to create a plan that manages incoming and outgoing inventory. What your inventory management plan looks like will vary based on what you’re selling, where your target market is located, and how fast you plan on scaling.
Regardless of the details of how you plan on managing incoming and outgoing shipments, it’s important that this is done collaboratively with your fulfillment partner, even if you are relying on their expertise to guide decision making. Creating the plan together:
- Establishes clear expectation (for the provider and for yourself), which will help the partnership remain healthy
- Allows both parties to clearly see, evaluate, and modify the plan before it’s implemented
- Lessens the likelihood of miscommunication or confusion
- Allows issues to be systematically addressed as they arise
If you don’t participate in creating the plan, you’ll struggle to set realistic expectations for your provider, which means you’ll struggle to objectively evaluate the performance of the China 3PL. Collaborate with your fulfillment provider, create a plan with clear expectations for you and for them, and then implement that plan as a team.
Evaluate Your 3PL Performance
When you’ve done the legwork to identify your specific needs, find a China 3PL that provides the services to meet your needs, and you work together to create a plan to manage inventory, then it’s far easier to evaluate the performance of your fulfillment partner.
You cannot afford to skip evaluating your fulfillment partner, since it’s the only way to know if your inventory is being handled appropriately and whether customer orders are being fulfilled on-time. If you’re not sure what metrics to pay close attention to, common, important benchmarks include:
- Order accuracy
- Customer satisfaction
- On-time delivery
- Cost-per-order
It may feel intimidating to evaluate and give feedback to a fulfillment partner, but high-quality China 3PLs thrive on feedback. It’s the best way to know that they are meeting their clients’ expectations and that the business relationship remains mutually beneficial.
Getting the Most Out of Your Fulfillment Partner is Challenging
Making sure you get the most out of your fulfillment partner is challenging. It requires businesses to put in the time to clearly understand their own needs, match with a supplier that is positioned to meet those needs, and to set clear expectations so that the business relationship can be advantageous for both parties.
However, even though it’s challenging, you cannot afford to ignore it. You need to understand how to hold your fulfillment partner accountable, and they need to understand what your expectations are for their services. If there’s a mismatch in communication, the services you receive will suffer, and as a result, your fulfillment processes will suffer, too.
EcommOps: Making It Easy to Get the Most Out of a China Fulfillment Partner
It can be intimidating to find a fulfillment partner, especially if you’re looking for the first time (or you’ve experienced what happens when a business partnership sours)If you’re looking for a fulfillment partner in China that prioritizes developing real business relationships with clients, we would love to connect with you.
EcommOps is able to develop and maintain relationships with our clients by:
- Facilitating easy communication (we offer bilingual, Mandarin/English support)
- Setting clear and reasonable expectations
- Offering transparency on our services and who we believe will benefit from out services
- Leveraging our expertise to help clients develop and implement fulfillment strategies targeted to help businesses meet their unique goals.
We only work with clients we believe can actually benefit from our services. To get in contact, fill out our online form, and we’ll be in touch to start creating the perfect fulfillment strategy for you.
China 3PL FAQs
1. What is a China 3PL fulfillment partner?
A China 3PL fulfillment partner is a China-based business that manages the inventory distribution needs of another business. Common services a China 3PL will offer include:
- Inventory Warehousing
- Inventory management strategies
- Order fulfillment
Other China 3PLs may offer a broader range of services. For example, EcommOps offers these listed services, as well as offering factory management.
2. How do I find the best China 3PL fulfillment partner for my business?
There are a few steps you can take to find a China 3PL Fulfillment partner that’s a good match for your business:
- Take clear inventory of the fulfillment services you need (not all fulfillment partners offer all services)
- Research to find several potential fulfillment partners that offer the services that you need. You can use online searches or referrals from other businesses
- After you have a group of potential candidates, do more intensive research. What kind of experience do they have fulfilling your product? How much experience do they have as a fulfillment provider? How large is their warehouse, and do they have the ability to scale with increasing sales volume?
- Finally, you’ll consider common factors, like how well they communicate, if their pricing is in line with the services they offer, and if they offer convenient ways to evaluate their performance.
3. What services do China 3PL fulfillment partners offer?
The exact services that a China 3PL fulfillment partner offers will vary from business to business, but you can generally expect to see services like:
- Order fulfillment
- Inventory warehousing
- Inventory management planning
- Tech integrations (like APIs)
- Factory management
- Product planning, like product iterations
- Branding consultations
4. What are the benefits of using a China 3PL fulfillment partner?
There’s a lot of benefits to using a China 3PL fulfillment partner, but it’s important to keep in mind that these benefits will only be available when you choose a fulfillment partner that is a good fit for your business needs. Possible benefits include:
- Successful implementation to difficult, but rewarding, inventory management strategies, like just-in-time stock management
- International shipping at a fraction of the cost by leveraging direct-to-customer (DTC) China fulfillment
- A better customer experience by having less products out of stock, more consistent shipping times, and less problems with order fulfillment
- Access to services that you may not have the expertise to perform yourself (like managing factories
If you want to know what specific benefits your business could receive from a China 3PL fulfillment partner, contact us, and the fulfillment experts at EcommOps will tell you the benefits that would be best suited for your business needs.
5. What should I look for in a China 3PL fulfillment partner?
Aside from making sure that a China 3PL fulfillment partner is a good match for your specific needs, there are some general characteristics that you should consider, too, including:
- The ability to clearly and effectively communicate
- How long they’ve been operating as a fulfillment partner (business take a risk partnering with a brand-new fulfillment partner)
- What experience they have in fulfilling your specific product or products in your general niche
- Whether they have an actual warehouse (not all fulfillment partners do, and it’s a must if you’re serious about scaling your business)
- The size of their warehouse the their overall capacity to scale with increasing sales volume
6. What logistics companies are in China?
There are dozens of logistics companies in China, all with their own service offerings and niche specialties. For example, EcommOps is a China 3PL, specializing in ecommerce order fulfillment and inventory management.
7. What is the difference between freight forwarding and warehousing?
Freight forwarding services specifically relate to delivering inventory from one location to another. For example, a freight forwarder may deliver products from a factory to a fulfillment center, or from a factory to a port to be prepared for sea freight shipping.
Warehousing involves receiving inventory, but also managing it. This means keeping track of stock levels, packaging products for orders, shipping customer orders, and managing returns.
8. What international shipments does a China 3PL fulfillment partner handle?
While it may depend on the specific China 3PL fulfillment partner you use, most will only be involved with fulfilling direct-to-customer international orders. China fulfillment partners may not help with the logistics of large volume, bulk orders that are shipped to a local warehouse via sea freight (like a sourcing specialist would).
However, a China 3PL fulfillment partner may be involved with fulfillment through a local warehouse, depending on your fulfillment strategy. For example, EcommOps helps businesses run a hybrid fulfillment strategy, where a China fulfillment warehouse and a local warehouse are used in tandem.
9. What is the cost of using a China 3PL fulfillment partner?
The cost of services that a China 3PL fulfillment partner will charge varies widely and is dependent on the kind of product you sell, the weight of that product, where the product is being shipped to, as well as a number of other factors.
High-quality China 3PL fulfillment partners will be upfront and transparent about their pricing, but you should always thoroughly read any pricing agreements before signing and beginning services.
