How Data Analytics from a 3PL Provider Can Give Your Business an Edge


Running an ecommerce business requires you to stay on top of everything to continue generating revenue and growth. One of the key aspects to help with your decision making is having the data to make the right decisions, especially when it comes to order fulfillment. If you run low on inventory or make preventable shipping mistakes, it could slow down your operations and lead to wasted time and money. To prevent this, you need accurate and real-time fulfillment data analytics. By leveraging the right kind of data and analytics you can forecast issues, prevent them from happening, and view where your products are in real time to allow you to make the best decisions. Most third-party logistics providers (3PL) will have this capability and your investment in a partnership will likely be worth the payoff. A good 3PL will help optimize your fulfillment plus give you the data you need to make efficient decisions, which will inevitably lead to boosts in customer experience, satisfaction, and ultimately loyalty. Here’s how great analytics from a 3PL can help your business.

Types of Fulfillment Data Analytics Businesses Can Expect

Below are some examples of analytics that your 3PL should be able to provide in order to help streamline your ecommerce fulfillment strategy. A 3PL will usually have a standard set of KPIs that they use for all of their clients, but they should also be able to put together customized analytics that fit your unique business and marketplace.

Usage Summary

Usage reports are necessary to understand which products are more popular than others based on sales, as well as the frequency at which they are being sold. This will help you know which items you need to reduce or increase spending on. This summary is also vital in helping you understand how to prepare for peak seasons during holidays or other promotional, high volume sales times, so you can avoid backordering items for online customers.

Fulfillment Accuracy

You should always strive for an accuracy rate of 100%, but that is not always possible. Errors like mislabeled SKUs, picking the wrong SKU from product lines, packing incorrect quantities, stockouts, and more, can reduce the accuracy rate. Every incorrectly filled order increases the risk of customer dissatisfaction, as customers will be frustrated when they receive the wrong items, or they arrive late. By monitoring fulfillment accuracy rates regularly, you will be able to quickly discern places you will need to make the process smoother.

“We wanted DCL because they were technology leaning, technology focused, and their tools made our lives easier. We didn’t have to pick up the phone all the time, we could see the value in the reports.”

Inder Singh CEO, Kinsa

Transportation Cost Per Package

Also known as shipping cost per order, this metric shows how much it costs your business to deliver each package to the customer. Keeping this metric as low as possible is critical, as it increases your profitability. Lower costs for transportation means higher savings, which can be used to provide lower prices for your customers, which can obviously raise customer satisfaction.

Customer Satisfaction Level

There are many ways to measure how happy customers are. There are short post-order surveys or longer form questionnaires that can help measure customer satisfaction more in depth. It is also possible to offer an option for a customer to review their purchases and order experience to provide visible feedback to other customers. Satisfaction is always an important performance indicator and will often encompass a set of metrics, based on the elements that you set to define your order experience for a customer.

Cycle Time

This report measures the total time taken since the products arrived at the fulfillment center and were picked up by the shipper for delivery, as a part of a customer order. The shorter the average time, the less money is tied up in working capital. An end-to-end order cycle time includes the transit and transportation time taken by the shippers for the final delivery to the customer’s premises.

Average Cost Per Order

This report measures how much you are spending, per order, on your fulfillment operations. These costs can include labor, damaged products, returns, operational costs (such as utilities, taxes, rent, etc.), equipment costs, and other variable costs depending on your unique warehousing needs. You want to ensure that these costs are as low as possible since a higher average cost per order can cut into your profits. By measuring the cost of goods sold you can improve your order management system and improve the amount of time it takes for order processing.


Expense reports provide valuable information to businesses because they show them where their money is going. Any additional expenses or maintenance fees will also be displayed in these reports, as well as shipping fees, packaging, and premium offers

How 3PL Analytics Help Ecommerce Businesses

Adjust Inventory Levels

Aspects like seasonality, the availability of labor, marketing and advertising promotions, as well as the weather can all influence the time from when an order is placed until it arrives at the customer’s door. Patterns begin to emerge when enough data is collected, which enables businesses to make more informed decisions that can help them adjust their inventory on an as-needed basis.

“In the past, we’ve had to use a number of different systems and spreadsheets to gain insights of our orders and inventory which was time consuming and at times, inaccurate. eFactory’s analytics allows us to view reports in a variety of different ways to help us plan and ensure we have the most up to date information for forecasting.” 

Bryson Smith Content Editor, Nomad

Identify Carrier Errors

Choosing the wrong carrier can cause a lot of problems for your business. Data analytics can help you avoid those who frequently make mistakes because they reveal various key performance indicators, such as how many invoicing errors or delayed deliveries a particular carrier has had. This will help you gauge their reliability and speed, so you can negotiate lower shipping rates and make the right decision on the best carrier for your company.

Product Decisions

3PL data analytics can help you decide when it might be time to remove a product line, or ramp up production if one of your products sees a spike in sales volume. Sales trends may show a product going steadily downward, signalling that it is losing popularity. Once you are aware of this, you need to stop restocking that item. Analytics not only reveal which products have become unpopular, but they also reveal the reason why. There may be a newer model available or a new competitor. When you can analyze the overall trend, your business will have a better understanding of the product trends for your overall company, as well as your given industry.

Cost Savings

Sometimes it can be difficult to find the areas where time and money can be saved. If you hope to see revenue growth, it’s important to avoid spending money and resources unnecessarily. Data analytics from your 3PL provider can provide you with the data you need to extract patterns that will help you make the right decisions that can help decrease your fulfillment costs.

Bottom Line

Consistent and accurate reporting is vital to running your business efficiently. In today’s hyper competitive marketplace you need the ability to scale and shift as quickly as possible so you can make the most of opportunities as they present themselves. Analytics from a 3PL can make the most of your operations and help cut costs, improve inefficiencies and better allocate resources. You need access to these reports to help you make the right decisions at the right time. A 3PL can customize KPIs and provide you with detailed data analytics reports to help you manage your operations now, and forecast for future changes.

If you are seeking fulfillment-related support we’d love to hear from you. You can read DCL’s list of services to learn more, or check out the many companies we work with to ensure great logistics support. Send us a note to connect about how we can help your company grow.