Third-party logistics (3PL) services have become an increasingly popular option for e-commerce retailers looking to manage their supply chain effectively. According to Statista, the eCommerce market is forecasted to experience a 9.30% increase in growth over the period of 2023-2027, reaching a market volume of $6.39tn by 2027.
The rise of e-commerce has resulted in a higher need for 3PL services. In fact, according to a report by GlobeNewswire, the global 3PL market size was valued at USD 962.1 billion in 2021. The forecast period from 2022 to 2030 is expected to see a growth rate of 8.58%, resulting in the market reaching a value of USD 2018.22 billion by 2030.
These services allow you to outsource your logistics and fulfillment operations to a specialized provider, which can help to streamline the supply chain and improve efficiency.
3pl providers can handle a variety of logistics-related tasks, such as warehousing, inventory management, transportation, and distribution. By outsourcing these tasks to a 3PL, businesses can gain access to specialized expertise and resources, which can help to streamline their supply chain and improve efficiency.
Some ways 3PL providers can help your business are:
Ease Of Operation
One of the key benefits of 3PL services for e-commerce retailers is the ability to scale their operations quickly and easily. As e-commerce sales continue to grow, retailers need to be able to respond to changes in demand and keep up with customer expectations for fast and reliable delivery.
By outsourcing logistics operations to a 3PL provider, you can quickly and easily scale your operations to meet these demands without the need to invest in expensive infrastructure or equipment.
Improve Supply Chain
In addition to this, 3PL providers also offer a wide range of services that can help e-commerce retailers to improve their supply chain operations. These services include warehousing and storage, inventory management, transportation and delivery, and even order fulfillment and customer service.
By outsourcing these tasks to a 3PL provider, you can focus on other areas of your business, such as product development and marketing, while still ensuring that your supply chain is running smoothly.
Access to Global Network
Another key benefit of 3PL services for e-commerce retailers is the ability to access a global network of logistics providers. The global cross-border e-commerce market has seen significant growth in recent years and is expected to continue growing at a fast pace.
A report by Zion Research states that the total value of cross-border e-commerce reached $562.1 billion in 2018 and is projected to reach over $4 trillion by 2027, with a compound annual growth rate of 27.4%.
With the rise of cross-border e-commerce, you need to be able to reach customers in different countries and regions. 3PL providers can help you to navigate the complexities of international logistics, such as customs regulations and duties, and can provide access to a global network of logistics providers. This will help you expand your reach and tap into new markets.
One important aspect of the 3PL service is its cost-saving aspect of it. You can save on operational costs by outsourcing logistics operations to a 3PL provider. A survey shows that the majority of shippers, 75%, have found that utilizing 3PL services has led to a reduction in overall logistics costs.
This is because 3PL providers can often negotiate better rates with suppliers and carriers and can also benefit from economies of scale through their ability to handle a larger volume of shipments. Additionally, retailers can avoid the need to invest in expensive infrastructure and equipment by outsourcing logistics operations to a 3PL provider.
Adoption Of Technology
Another major factor driving the growth of the 3PL market is the increasing adoption of automation and technology. 3PL providers are investing in advanced technologies, such as automation and data analytics, to improve their operations and offer more efficient and cost-effective services to their customers. This will drive the demand for 3PL services in the coming years.
In conclusion, 3PL services are becoming an increasingly popular option for e-commerce retailers looking to manage their supply chain effectively. These services allow retailers to outsource their logistics and fulfillment operations to a specialized provider, which can help to streamline the supply chain and improve efficiency.
With the ability to scale operations quickly, access a global network of logistics providers, and cost savings, it’s no surprise that more and more retailers are turning to 3PL services to help them manage their e-commerce supply chain.