We hear it all the time – you start out on your own with a Shopify store, fulfilling orders from your garage. Your ecommerce website catches on, and soon, what started as a side-hustle has turned into a full-time boxing and label-printing and shipping operation. The success is great, but your back isn’t happy with all the box-lifting.
It’s time to outsource your Shopify Order fulfillment to a third party logistics (3PL) company who can solve your operational headaches and let you get back to what you do best – creating and selling amazing products. There are so many 3PLs and warehouses out there. How do you choose one that’s right for your ecommerce business?
In this post, we’ll dive into what makes the best Shopify 3PL, and evaluate a few of the leading order fulfillment options in the industry today.
What Makes a Good 3PL for Shopify Sellers?
If you’re an ambitious ecommerce seller looking to boost your growth, you should know that the right Shopify 3PL can be a revenue driver, and not just a cost center. The best 3PLs will improve your delivery experience, delight customers and open new avenues for growth.
Here are the most important things to look for in your a 3PL for your Shopify store:
1. Nationwide USA warehouses
Don’t sell yourself short. Even if you’re small now, you can still distribute your inventory across the country to unlock affordable fast and free shipping without huge expense. That is, if your Shopify 3PL has nationwide warehouses.
You’ll want to make sure your Shopify 3PL has at least 4 order fulfillment centers across the USA, but ideally the best 3PL will have many more warehouses so that they can fine-tune exactly where your product inventory is placed to be near your largest customer base.
The best 3PLs offer true national order fulfillment services by placing inventory in 4+ locations strategically across the country. The benefit to you is that these networks cover 99%+ of US consumers with 2-day shipping at economy shipping rates. No matter where your customer wants their product shipped, you’ll have inventory nearby. They will get their products quickly, and you’ll pay the cheapest shipping rates possible.
If you aren’t already offering free 2-day shipping, it’s a recommended upgrade that can truly turbocharge your ecommerce growth. A recent McKinsey study found that a whopping 90% of US online shoppers expect free one-day and two-day shipping. Amazon metrics show that turning on the Amazon Prime badge can net up to 50% growth for a product!
Adding a banner or top bar to your Shopify store that says “Fast and free shipping” can boost your ecommerce conversions and revenue. See example below.
2. User-friendly shipping software
As a business owner, it’s tough to give up control and outsource to other companies. The best Shopify 3PLs know that, so they provide their customers with easy-to-use shipping software that provides proactive notifications and robust reporting on how they’re doing. If you can’t get real-time updates on the status of your orders, your inventory levels, and shipping and order fulfillment costs, then you’re not working with a cutting-edge 3PL.
One key benefit of great 3PL shipping software is proactive notifications. Unfortunately, things go wrong all the time in the shipping logistics world. It can be as simple as an undeliverable address incorrectly input by the customer, or, as complex as a worldwide supply chain and shipping crisis. The best Shopify 3PLs don’t leave it up to you to identify order fulfillment problems. Their shipping software should alert you when a customer places an order with an undeliverable address. You can immediately fix the issue before it turns into a late order shipment, and you’ll keep the customer happy.
“I use Cahoot to process our shipping labels. Their auto label creation feature is a huge time saver. We are continuing to use Cahoot over our previous shipping label provider.”
–Home and Garden Supply
3. Achieve a 99% Order Fulfillment Rate
Reviews are the lifeblood of your ecommerce business, and a happy customer is a repeat customer. You can probably recall more than a few lost customers and poor reviews that were due to errors in order fulfillment and shipping process that were not your fault.
The best Shopify 3PLs should minimize these issues have on-time fulfillment rate of 99.9% or higher. Anything less signals a Shopify 3PL that isn’t built for the rigorous demands of modern ecommerce.
Top 3PLs designed for ecommerce order fulfillment also integrate technology like barcode scanning into their warehouses to eliminate errors. Simple but effective innovations like these stop issues before they happen, and they also fuel the functionality of the software mentioned above.
4. Multi-carrier shipping discounts and carrier flexibility
Shipping fees eat up a significant chunk of every ecommerce merchant’s profits, but where there’s extra cost, there’s an opportunity to save. The best 3PLs who ship huge volumes of packages every year will negotiate preferred rates with major and regional parcel carriers, and they should pass those savings on to you.
Source: ShipStation
Beware though. A trick in the 3PL industry is to consolidate pricing into a single one line item, and not itemize what you’re paying for every component of their service. While it can feel helpful to be quoted one simple price, keep in mind this enables the 3PL to charge you more for shipping than what they’re paying the carrier, and keep the difference without you knowing.
The best Shopify 3PLs work with all shipping carriers, not just one. The reason why is simple. Different carriers have the best rates for different routes and package sizes, and types of products. If you’re locked into just one carrier, you’re not getting the best shipping prices.
5. Pre-built ecommerce integrations and open APIs
It shouldn’t be hard to connect your Shopify store to your 3PL. The best 3PLs have pre-built integrations that will do it in a few clicks.
This goes for other ecommerce platforms too. Many merchants are scaling into multiple sales channels to maximize growth, and your 3PL should be able to integrate easily with all of them.
Not every ecommerce merchant can work with pre-built integrations, especially larger ecommerce merchants with custom and complex order and inventory management systems. For that, your Shopify 3PL of choice should have an open API and support resources that make the order fulfillment integration process as seamless as possible.
6. Responsive customer service
Finally, the best Shopify 3PLs offer amazing customer suppport. You should be able to get in touch with your 3PL easily to troubleshoot challenges. Look for a Shopify 3PL that assigns a real person to work with your ecommerce account. Make sure there are multiple ways to get in touch with them. If it’s a small issue, live chat works. Complex challenges,, should be handled by an advanced ticket system. And finally, , you need a direct phone number for critical order fulfillment issues.
“We switched to Cahoot from a different 3PL and the team has bent over backwards to make the transition easy and seamless. Great personal assistance every day from the team and very quick, reliable shipping from the Cahoot partner warehouse. Highly recommend their service.”
–Cut.com
Top Shopify 3PL Companies
Now that you know what to look for, how do a few of the top players in the 3PL industry stack up? We’ve provided a primer to help jump-start your order fulfillment research.
Amazon Multi-Channel Fulfillment
You can use Amazon’s fulfillment network, FBA, to fulfill Shopify orders. When you do so, it’s called Amazon Multi-Channel Fulfillment – but it does in fact use the exact same FBA resources.
Pros:
- Biggest ecommerce order fulfillment network in the USA, powers fast shipping
- Robust shipping software
- Pre-built integration with Shopify
Cons:
- Much more expensive than FBA, despite being the same service
- Only works with webstores – won’t fulfill for other marketplaces
- Unresponsive customer service
Shopify Fulfillment Network
Like Amazon FBA, Shopify is building its own logistics service for ecommerce sellers called Shopify Fulfillment Network.
Pros:
- Combines seamlessly with your Shopify account
- Shipping software helps with order and inventory management
- Dedicated customer service
Cons:
- Focused on fulfilling Shopify orders only
- Not fast shipping by default; have to pay more
- Only 99.5% order accuracy
ShipBob
ShipBob is a 3PL that focuses on serving ecommerce merchants. They have a nationwide network of order fulfillment centers that enable fast shipping, but they charge extra for guaranteed 2-day shipping. Built for ecommerce, they have an easy-to-use shipping software platform and a large set of pre-built integrations.
Pros:
- Nationwide network of order fulfillment centers
- Direct integration with Shopify as well as major marketplaces
- Chat & phone support
Cons:
- Not fast shipping by default; have to pay more and not always ground rates
- Pricing is opaque – they say that Pick and Pack and Standard Packing is “free”, but of course they make up for that by overcharging elsewhere
Red Stag Fulfillment
Red Stag Fulfillment is a more traditional 3PL, with only two locations in the United States. They offer B2B fulfillment in addition to B2C since they have a wider focus than just ecommerce.
Pros:
- Shipping discounts across different carriers
- Pre-built integrations with marketplaces and shopping carts
- >99.9% order accuracy
Cons:
- Only two USA warehouses – they can’t cover all USA customers with affordable one-day or two-day shipping
Cahoot: The Best Shopify 3PL
Cahoot’s order fulfillment services network is built for ecommerce. We’ll help you level the playing field with marketplaces and delight your customers with a stellar, Amazon-like delivery experience – right from your Shopify store. And we don’t stop there. We have pre-built ecommerce integrations with major marketplaces to fuel your multi-channel growth.
Our innovative peer-to-peer model offers low-cost, fast nationwide order fulfillment by design. As a result, our pricing is typically 30% lower than the 3PL providers listed above, and we can beat them on order fulfillment speed and delivery reliability.
Cahoot is committed to helping Shopify sellers grow their businesses with fast and affordable ecommerce order fulfillment service.
If you’d like to find out how Cahoot can help your ecommerce business, please get in touch with us. We can’t wait to show you how Shopify order fulfillment was meant to be.
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