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Fulfillment Services Pricing: Let’s Talk Apples To Apples

This is part one in a two-part series. Read part two here.

Choosing the perfect fulfillment services partner can be really tough.

After all, there are plenty of features to navigate that you’ve probably never considered before and reputations to probe before you ever enter into any real negotiations.

Once you’ve made your short list, though, how you can really tell which company is offering you the better deal? Well, it’s a matter of comparing apples to apples. At the end of the day, no matter how advanced or basic your 3rd party logistics (3PL) partner, their services can be broken down into similar areas.

Getting Started Comparing Companies Side By Side

By asking each 3PL you’re interested in using for an itemized list of the services it offers for the budget level you’re discussing, you can start to compare them to one another.

  • Know what you’re getting. Simply being told that “warehousing” will cost you so much per pallet really doesn’t speak to the sophistication of the warehousing tools available, but it does give you a place to start negotiations. It’s important to know exactly what you’re getting in your package—and what you’re not getting, too—so that you can make an informed decision for your business.
  • Ask for more information. The detail level you request should be deep, from the cost of your 3PL to provide custom shipping crates to additional fees for services like customer web portals and EDI services, every bullet point matters. Don’t be afraid to go back to your other 3PLs repeatedly for more information if you find a company that’s offering a service you’d like to explore that no one has mentioned yet. Never assume, keep asking.
  • Understand the landscape. Once you have your quotes side by side, you can look at your apples and select the firmest, shiniest one in the pile, can’t you? Well, not quite. Comparing apples to apples in the world of fulfillment services also means exploring the less quantifiable parts of the business, like how well the company will support you during a rush time or what efforts they’re making to improve their shipping and packing speeds.

Comparing 3PL apples to apples is tricky business, but it gets a little easier when you have a chance to see the tree where they’re growing. These are intangibles you can only get by being in communication with people involved in the day to day running of your new 3PL partner, but we’ll talk about ways to spot the most forward thinking fulfillment services in the second part of this two-part blog series.

December 06, 2016
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