Most ecommerce companies have more than one sales channel, distributing products to both B2C and B2B customers. Your B2C customers demand that their orders are shipped quickly with 100% accuracy. Your B2B customers expect the same, without accepting so much product that it takes up valuable storage space.
To serve both channels, you may think that you need to separate your products and work with different third-party logistics (3PL) providers to handle storage and fulfillment of each. Fortunately, there are many 3PLs that can handle all your sales channels simultaneously. This is called omnichannel fulfillment.
What is Omnichannel Fulfillment?
Meaning “all channels”, omnichannel fulfillment is a strategy that handles all inventory, going to many different places, from one location or supplier (like a 3PL). With omnichannel fulfillment, your 3PL manages your entire inventory, optimizing their operations for picking, packing and shipping to whatever channel next orders your product. Your products are pulled from the same inventory pool, which can be distributed among your 3PLs fulfillment centers, and prepared for shipping.
“It’s hard to find 3PLs that have a deep expertise in dealing with Amazon, and all of the dot.coms, as well as dealing with brick-and-mortar. We feel like we really have a partner because DCL has that deep experience. To me that’s the more complex part of being a 3PL; shipping pallets into distribution centers for brick-and-mortar retail is a lot easier. The difference is, DCL has a reputation for being very technology forward, helping companies drive from an omnichannel perspective for their business, not just traditional brick-and-mortar.”
The Role of WMS
Omnichannel fulfillment can be a relatively simple process to set up thanks to sophisticated warehouse management software (WMS). This software is the cornerstone of the modern 3PL warehouse and allows for your entire inventory to be managed by one centralized system, regardless of how many sales channels your product ships to. It also allows for seamless integration (typically via EDI, which stands for electronic data interchange) between your systems and your 3PL’s systems, and between your 3PL’s system and your customers’ systems. Its capabilities include:
Inventory management: The WMS will record and manage your products according to key characteristics like warehouse location, available quantity, pallet ID, serial number, lot number, and expiration date.
Order status: As orders are received, their shipment status and parcel tracking information can be viewed in real-time.
Label generation: ecommerce orders will trigger the creation and printing of shipping labels, while retailer orders will trigger labels that comply with individual retailer specifications.
These capabilities can be a game-changer, but also come with a hefty upfront price tag – often as much as six figures. By partnering with a 3PL that already has a WMS, you can take full advantage of these features without footing the bill.
Your 3PL’s WMS will integrate with your chosen ecommerce platform (e.g., Amazon, Magento, Shopify, Big Commerce). As orders come in, the WMS will provide order details and item locations, prepare shipping labels, and schedule shipment with the 3PL’s shipping partners. Products will then be packed, labels affixed, and final QA will be performed.
Most 3PLs will ship same-day for orders received by mid-day or slightly later. However, the exact timing can be worked out between you and your 3PL during contract negotiations. In addition to the cost savings associated with using your 3PL’s WMS, you can also save money through your 3PL’s carrier relationships. Your 3PL will likely handle ecommerce fulfillment for a variety of different clients. This allows it to negotiate better rates wit
As with B2C fulfillment, orders from retailers and other B2B customers will feed into your 3PL’s WMS. From there, your 3PL will coordinate the outbound shipment, either with its internal transportation arm or with an external provider. Because of the time it takes to coordinate the outbound distribution most 3PL’s will request that B2B orders be submitted by the end of the business day prior to shipment. Of course, supply chains don’t always operate according to plan and many 3PLs will honor same-day shipping whenever possible.
In addition to B2C and B2B, there is another form of fulfillment that some 3PLs will handle for manufacturers, called just-in-time delivery (JIT). With JIT delivery, your 3PL will store component parts and kits needed for assembly and then deliver those items to the manufacturer at set intervals, sometimes several times per day. The parts only appear onsite when they are needed. The new orders trigger them to be sent to assembly, which frees up the manufacturer’s space to focus on production without eating up valuable floor space with component inventory.
If you have a growing product company, and are overwhelmed by the number of sales channels you deliver to, an omnichannel strategy is a great option. By partnering with an experienced 3PL you will have access to multiple fulfillment centers and relationships with major shipping carriers. Your 3PL can help get your products, whether B2B or B2C, into your customers hands faster and at a lower cost than fulfilling them yourself.
If you are looking for omnichannel fulfillment we would love to hear from you. Send us a note to connect about how we can help your company grow. 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.
Tags: omnichannel, What is a 3PL?