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Streamline Inventory with Shopify 3PL Warehousing!

By Abhishek Sebin on 1/31/2024 · 5 minute read

As your business expands, it becomes essential to make strategic decisions and adjustments to sustain that growth while keeping your sanity intact! A reliable partner for your [Shopify](https://instasell.io/blog/shopify-alternatives) order fulfillment can be a game changer in this aspect. Shopify provides an exceptional platform enabling [eCommerce](https://instasell.io/blog/unlocking-ecommerce-potential) entrepreneurs to virtually run their stores single-handedly. However, it also offers the flexibility to link your account with various CRM, ERP, and order fulfillment solutions, enhancing your operational efficiency.

When is the right moment to enhance your Shopify by incorporating extra tools and delegating order fulfillment to others? For a lot of entrepreneurs, there reaches a point where they find it challenging to manage and dispatch orders by themselves.

This volume of work is distinct but may range from 10 to 50 new orders per day to be fulfilled. At this scale, it can become unmanageable for small businesses to take on their order processing tasks.

If you’re considering diving into 3PL and Shopify order fulfillment partnerships, we’ve got you covered with a guide on everything you need to understand in order to choose the perfect collaborator for your Shopify eCommerce business.

Understanding 3PL [Logistics](https://instasell.io/blog/best-door-to-door-delivery-service-in-india-in-2022-cl0lb6hy105591jqygokdujdm') & Shopify

When managing your eCommerce store on Shopify, you have three main options for handling your logistics:

  • Embracing the DIY method
  • Partnering with a Third-Party Logistics Provider
  • [Dropshipping](https://instasell.io/blog/aliexpress-alternatives) has established itself as a fantastic mechanism for entrepreneurs to launch their ventures without the significant upfront investment typically associated with stocking inventory. This business model allows you to sell products to your customers without ever having physical possession of the merchandise. Essentially, when a customer makes a purchase, you pass the order to a third-party supplier who then ships the product directly to the customer. This strategy not only minimizes the risk and cost but also opens up a world of opportunities for entrepreneurs eager to delve into the e-commerce realm.

If you decide on this method of logistics management and order fulfillment, you’ll find yourself reviewing orders, packing the items, and handling the shipping process on your own.

By partnering with a 3PL fulfillment service, they handle the storage, shipping, and monitoring of your orders. A seasoned 3PL ally streamlines the integration with your Shopify account, making the setup seamless.

In dropshipping, your partner takes care of dispatching the products directly to your customers once an order is made. Much like outsourcing to a third-party logistics provider (3PL), integrating dropshipping with your Shopify store is also necessary.

Does Shopify Have 3PL [Integrations](https://instasell.io/blog/shopify-ebay-integration)?

Shopify offers integrations with 3PL providers that simplify your operations and enhance the efficiency of your business. To initiate the integration, you’ll need to start by configuring your order fulfillment settings.

To achieve this, navigate to your Shopify admin dashboard and choose the fulfillment option that best suits your needs: whether it’s in-house (opting for either automatic or manual fulfillment), dropshipping, or third-party logistics (3PL).

After deciding to employ a 3PL for your order processing needs, you’ll link your Shopify account with the 3PL’s system. This integration guarantees that orders are promptly forwarded to the 3PL for efficient processing and that inventory statuses are transparent to both you and the 3PL.

Understanding Shopify Order Fulfillment Options & Integrations

As previously highlighted, you have three choices when it comes to fulfilling orders on Shopify. Let’s dive deeper into what you can expect to find on your Shopify admin dashboard, helping you choose the best option for your enterprise.

Specific orders, such as PDFs, can automatically be dispatched to the customer’s email upon order placement, which means you won’t have to dedicate additional time to sending out those digital files.

For Shopify owners, the most frequent method of order fulfillment involves personally packing and dispatching items to customers. This process can prove to be both time-consuming and difficult for many entrepreneurs to maintain consistently.

When your dropship partner takes charge of fulfilling orders, this option lets you connect your Shopify store with their dropshipping platform, enabling them to receive alerts about new orders.

Similar to dropshipping, this method enables you to sync your Shopify account with the 3PL software, allowing them to start handling and fulfilling orders the moment your customers make them.

What Is a 3PL Integration for Shopify?

The term “integration” has popped up a few times… and you might be curious about its exact meaning and its importance to your business. Integration encompasses more than merely forwarding orders to your shipping partner or third-party logistics provider. This step can also facilitate different facets of your business operations.

When joining forces with 3PL fulfillment centers, ensure they are compatible with:

  • Optimizing Your Order Management on Shopify

  • Ensuring your inventory management system is precise for accurate stock levels is crucial for the smooth operation of your business. This means keeping a meticulous eye on your inventory to ensure you have exactly what you need, when you need it. By maintaining an accurate count, you can avoid the common pitfalls of overstocking or understocking, which can directly impact your business’s efficiency and profitability. An effective inventory management system becomes an indispensable tool, serving as the backbone of a well-oiled supply chain, ensuring you always stay on top of your stock levels.

  • The seamless partnership is further facilitated by any software we deploy for order processing, tracking, or other relevant processes.

  • Your current warehouse management system, should you have one in place (and if not, rest assured, most third-party logistics providers come equipped with their own WMS, ready to accommodate your inventory requirements)

Certain third-party logistics providers (3PLs) are capable of seamlessly connecting with Shopify, aiding in the execution of order management functions such as updating order statuses to fulfilled, managing refunds, or overseeing inventory counts. This integration is essential for business expansion, escalating your eCommerce sales, and ensuring customer satisfaction!

3PL Process Flow

When you entrust your inventory to an external party for the first time, numerous online sellers worry that they will lose control or visibility over their stock.

But, by teaming up with the ideal 3PL collaborator, you’re endowed with extra resources and insights into your business operations. The 3PL journey transforms your logistics collaborator into exactly that: a collaborator. Together with your 3PL, you’ll tackle supply chain challenges head-on. This means precise inventory control, swift order processing, and ultimately, happy customers who keep returning.

Here are the key stages in the 3PL process flow:

As soon as the inventory departs from your—or your manufacturer’s—possession and makes its way to the 3PL warehouse, logistics experts will need to step in to handle its reception. This initial task involves entering the data into the warehouse management system to maintain precise records of what has been received.

Once the items are precisely entered, they will be placed on the designated shelves, bins, or pallets reserved for your stock. This organization ensures that the subsequent stages of the process proceed without a hitch.

Once you’ve placed an order, the 3PL warehouse springs into action, thanks to its seamless integration with your Shopify software. It swiftly prints out the packing slip and sets about gathering the items for each order from its organized shelves, bins, or pallets.

Once all items have been collected, we ensure that orders are carefully packaged. The option to personalize your packaging materials with custom-designed boxes, envelopes, or tape is available, allowing your customers to recognize your brand from the moment they lay eyes on their package.

Once the order has been prepared and packed, it gets a shipping label and is moved to the warehouse’s designated area for the delivery service to collect. Partnering with a 3PL could also open up a variety of additional shipping carrier options, thanks to their established relationships with these entities.

Returns are a part of business – no need to stress! Third-party logistics providers (3PLs) offer return management services tailored for your Shopify store, managing everything so you can relax.

Benefits of Shopify 3PL Partnerships

When contemplating a Shopify-3PL partnership to handle some of your business operations, you might discover more advantages than initially anticipated.

Shopify store owners can experience a variety of advantages when they opt for a 3PL order fulfillment strategy. Here are the key benefits:

  1. 3PLs wield advanced technology and streamlined processes to maintain precise inventory tracking and stocking figures, allowing you to avoid the awkward moment of informing customers they’ve bought an item that’s no longer available.
  2. A 3PL could also assist in forecasting future sales spikes, enabling you to prepare in advance and stock up on extra inventory to avoid any order processing delays.
  3. The primary motive behind online ventures partnering with third-party logistics (3PLs) lies in order fulfillment. These logistic allies have the prowess to efficiently and precisely handle the picking and packing of customer orders as they arrive, curtailing processing durations and upholding accuracy in fulfilling orders.
  4. Additionally, you have the option to utilize extra shipping offerings, such as faster delivery or shipments to overseas locations.
  5. When space starts to become an issue and you’re thinking about pouring money into extra warehouse capacity, turning to a 3PL might be your solution. With inventory warehousing as one of the core services in order fulfillment, you’ll have ample space to keep your goods until they’re ready to be dispatched to your clients.
  6. A third-party logistics (3PL) warehouse management system aids in maintaining precise inventory counts and organization, while also providing valuable insights into your company’s data.
  7. Say goodbye to the clutter of boxes and envelopes in your office and the panic of running low right before a rush of holiday orders hits. A 3PL ensures you have the perfect size and type of packaging, along with the necessary packing materials, to secure your products on their journey to their new home.
  8. Third-party logistics (3PL) providers frequently broker deals with shipping carriers to secure reduced rates and discounts. Companies such as UPS, FedEx, USPS, and DHL partner with 3PLs, offering them bulk pricing for both domestic and international deliveries, including options for overnight or expedited shipping services.

FAQ

Q1: What is 3PL and what role does it play in shipping?
A1: 3PL, or Third-Party Logistics, is a service that takes charge of the entire shipping process. From receiving orders at their facility to ensuring timely and accurate delivery to customers, 3PL covers all aspects of shipping.

Q2: How does Shopify integrate with 3PL services?
A2: Shopify offers seamless integration with numerous 3PL services. This can be done directly through the Shopify site or via API, allowing external software systems to access order details for efficient handling.

Q3: Why is integrating a 3PL service with Shopify beneficial for a business?
A3: Integrating a 3PL service with Shopify is beneficial for outsourcing product processing and shipping. It places your products in the hands of shipping professionals, potentially leading to significant savings on shipping and labor costs.

Q4: What is the difference between 3PLs and dropshipping?
A4: The main difference lies in the fulfillment process. In dropshipping, manufacturers or distributors send products directly to customers per order. In contrast, a 3PL partnership involves logistics experts who handle the secure packing and swift dispatching of orders, ensuring a smooth delivery experience.

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