Evaluating Third-Party Logistics Providers

"Your quote is too high." No, it's just honest. Too many logistics companies lowball their quotes, then sneak in fees later. That strategy might win a shipment, but it loses trust. This morning, I spoke with a prospect comparing us (Onboard Logistics Group) to another forwarder. Their first words? "Your quote seems a little on the high end." I said, “Totally fair. Have you gotten a much lower one? Let’s break it down together. I want to make sure you're not hit with surprise charges once the shipment moves.” And we did. Turns out, the competitor’s quote left out origin and destination charges. Stuff the prospect actually needed... but wasn’t told about. In the end? Our quote was not only transparent. It was cheaper. But the best part? That 5-minute breakdown likely earned more than one shipment. It built trust. Undercutting wins attention. Transparency wins relationships.

After working for 3PL's for about 10 years There are 3 mistakes brands make when looking for a new 3PL. Do the opposite of these. #1 - Neglecting Cultural Fit and Communication Styles The relationship with your 3PL is more than just transactional; It is a long term "marriage." Avoid underestimating the importance of cultural fit and effective communication. Misaligned values or communication breakdowns can lead to frustration and inefficiency. Questions you should ask yourself ⬇️ Do you want a slack channel for you and your 3PL? Do you want an account manager on the ground at the warehouse? How quickly do they respond to your inquiries during procurement? (Its probably an indication of what the relationship will be like) Who are the types of people that work at the 3PL? What background do they have? Is it in logistics/supply chain? #2 - Not doing enough thorough research This is the one that bites people in the ass the most. You dont 25 different 3PL's in the mix. You need a solid 5. Better to go a mile deep than a mile wide. As a sales rep - this next part is kind of counterintuitive. Don't take the sales pitch at face value. Look for objective, third-party opinions and reviews to get a well-rounded understanding of their capabilities and service quality. Sure, sites like G2 and Trust Pilot are good but go deeper. Ask the 3PL for client referrals. Even better - go to their customer testimonial page and reach out to the brand by yourself. Go to e-com communities (Reddit, Facebook) - try to get in virtual or in person reviews of the 3PL performance. Once you dwindle down the list to your top 2-3 Then start understanding the company financials. I have seen many 3PL's either been shut down due, forcing merchants to leave abruptly. This is a crucial step. # 3 - Overlooking Scalability and Flexibility: You are, ideally, finding a 3PL partner for the next 3 years. Not the next 6 months. As your business grows, your logistics needs will evolve, and your 3PL should be able to accommodate this growth. Ask how they have supported the growth of brands throughout the years. The answers, or lack thereof, will be telling. Have them give you an example (or two) of them bending over backwards for a client when times got tough. Ask them how peak 2023 season went. Don't take "good" as a surface level answer. Ask more specific questions. Ask to what extent they dealt with large processing delays. What their average delivery time was. Any unexpected situations that came up and how did they handle them? I could go on forever, but these 3 areas are often most overlooked. The more you know, the better you will be choosing the right partner . #3PL #logistics #supplychain

Let’s say you’re a newly hired Third-Party Risk Analyst at a mid-sized healthcare company. During your onboarding, you realize that while they have dozens of vendors handling sensitive patient data (think billing companies, cloud services, and telehealth providers), they have no formal third-party risk assessments documented. First, you would start by building a basic Third-Party Inventory. You’d gather a list of all vendors, what services they provide, and what kind of data they have access to. You would focus on vendors that touch patient records (Protected Health Information, or PHI) because HIPAA requires stricter handling for that kind of data. Next, you would create a simple vendor risk rating system. For example, any vendor handling PHI = High Risk, vendors with financial data = Medium Risk, vendors with only public data = Low Risk. You’d organize vendors into those categories so leadership can prioritize attention. Then, you would prepare a basic Due Diligence Questionnaire to send out. It would ask things like: • Do you encrypt PHI data in transit and at rest? • Do you have a current SOC 2 report? • Have you had any breaches in the last 12 months? After collecting responses, you would review them and flag any vendors who seem high-risk (like no encryption, no audit reports, or recent breaches). You’d recommend follow-ups, like contract updates, requiring security improvements, or even switching providers if needed. Finally, you would propose setting up a recurring third-party review schedule — maybe every 6 or 12 months — so that vendor risk stays managed continuously, not just one time.

Brands usually only approach us once they’ve had nightmare experience with another 3PL. Let me explain. Things like: - Late shipping times - Poor product handling - No consistent communication - Complicated invoices - Compliance issues when sending stock to FBA (big one) Just things that’ll hamper your logistics & slow down your brand’s operations. Usually it’s because brand owners opt for the cheapest warehousing & storage they can find. But spending that extra 10% or 20% on a reliable 3PL that you can trust is worth its weight in gold. Especially if they do more for you than solely just warehousing. Not to toot my own horn, but at At AMZ Prep we: - Hyper focus on eComm / DTC and Amazon fulfillment (FBA, FBM, SFP) - Provide warehousing across the US & Canada @ 98% accuracy  - Communicate daily with our customers via slack  - Built an entire consulting wing for international expansion & enablement - Decided to never have customer service with ticketing system (best idea) - Host monthly & quarterly performance reviews with accounts - Work directly with the Amazon teams directly to ensure we are up to date with compliance - Plan annual fly outs with our larger brands to meet them in-person The point being is make sure you do your research. Research different 3PLs & ask them the following questions: - What sets your company apart from other 3PLs? - What do you consider your specialty? (Amazon, eComm, Retail..etc) - Do you have case studies I can read? - Can we see an onboarding roadmap?  - What happens when things go wrong? If you have the budget, fly out to go for a warehouse tour. If you can’t, ask for a virtual face tour on face time…. You’ll get to understand the operations and setup quickly. Spend $500 to save $5000 down the line is my motto here. We’ve even paid for some of our prospects flights to meet in person. Just cause I know once they see the warehouse, meet the team, the robots. It’ll be a done deal. I’d rather you get this right the first time. It’ll save you so much headache in the long run. The logistics aspect of every eCommerce business is so under rated. Yet, they will just hire the first warehouse that provides $15 storage.

So your business is expanding or has blown up overnight....what should you be looking for in a 3rd party fulfillment (3pl) party. 1️⃣ Expertise and Specialization: Look for a 3PL provider with expertise in your industry and specialized services aligned with your needs. Whether it's e-commerce fulfillment, perishable goods handling, or specialized transportation, partnering with a company well-versed in your sector can offer tailored solutions and insights. 2️⃣ Technology and Innovation: Evaluate the technological capabilities of prospective 3PL partners. Advanced systems for inventory management, order tracking, and real-time analytics can significantly enhance visibility and streamline operations within your supply chain. 3️⃣ Scalability and Flexibility: As your business grows, your logistics requirements may evolve. Seek a 3PL provider capable of scaling operations seamlessly to accommodate fluctuations in demand and seasonal peaks. Flexibility in service offerings and contractual agreements is key to adapting to changing market dynamics. 4️⃣ Geographical Reach and Network: Consider the geographical reach and network of the 3PL provider. A robust network of distribution centers and transportation hubs can enhance speed-to-market and reduce transit times, ultimately improving customer satisfaction. 5️⃣ Operational Excellence and Compliance: Prioritize 3PL partners with a track record of operational excellence and adherence to industry regulations and compliance standards. Certifications such as ISO, C-TPAT, and TSA can signify a commitment to quality and security throughout the supply chain. 6️⃣ Cost and Value Proposition: While cost is a significant factor, focus on the overall value proposition offered by potential 3PL partners. Evaluate not only pricing structures but also the level of service, reliability, and added value initiatives such as sustainability practices or value-added services. 7️⃣ Customer References and Reviews: Finally, seek out customer references and reviews to gain insights into the experiences of other businesses partnering with the 3PL provider. Positive testimonials and case studies can provide confidence in the provider's ability to deliver on promises. Choosing the right 3PL partner is a strategic decision with long-term implications for your business success. By carefully evaluating these factors, you can identify a partner that aligns with your goals, enhances operational efficiency, and drives growth in your supply chain. #SupplyChain #Logistics #3PL #Operations #BusinessStrategy #SupplyChainManagement #Partnership

Honesty in Logistics Has to Go Both Ways: Ever had a logistics provider tell you exactly what you wanted to hear, only to find out later that things weren’t as smooth as they promised? Or maybe you’ve been on the other side, holding back critical details hoping things will just work themselves out? The truth is, transparency in logistics has to go both ways. A great provider will tell you the hard truths because they know short-term convenience isn’t worth long-term damage to trust. But shippers play an important role too. If critical details about lead times, flexibility, or special handling needs aren’t shared upfront, even the best logistics partners can only do so much. Strong partnerships are built on honest conversations. When both sides commit to clear, proactive communication, problem-solving becomes easier, surprises are minimized, and everyone operates more efficiently. So, when entertaining making changes with your logistics process, ask yourself: Are you fostering transparency in your logistics partnerships? Because trust isn’t just about what your provider tells you, it’s about what you share with them, too. #logistics #partnerships #trust #supplychainsolutions #integrity

Exploring 3PLs for your business? Here are 10 essential questions to guide your decision: 1. What are your service fees, and how do they break down? 2. How many clients or businesses do you currently serve? 3. How long have you been in the 3PL industry? 4. What technology or systems do you use for order and inventory management? 5. How do you ensure accurate and timely order fulfillment? 6. What is your approach to handling returns and managing reverse logistics? 7. Do you provide real-time visibility into inventory levels and order status? 8. How do you handle peak seasons or sudden spikes in order volume? 9. What performance metrics do you track, and how do you communicate them to clients? 10. Is there flexibility in your contract terms, and what is the process for scaling services up or down? Remember, these questions are a starting point. The right 3PL partner is crucial for your supply chain success, so don't hesitate to dig deeper and ask additional questions tailored to your specific business needs. Treating the selection process like a job interview ensures you find the best fit for your logistics requirements. #supplychain #3pl #logisticssuccess

5 Key Considerations When Choosing a 3PL Partner for Your E-commerce Brand As your e-commerce business grows, selecting the right 3PL becomes crucial. Here are some factors to keep in mind: 1. Scalability: Look for a partner who can handle your current volume and accommodate future growth. Flexibility is key. 2. Technology Integration: Seamless integration with your e-commerce platform can significantly boost efficiency. Don't overlook this aspect. 3. Specialization: Consider 3PLs with experience in your product category. Their expertise can be invaluable. 4. Geographic Reach: Think about your customer base. Strategically located warehouses can reduce shipping times and costs. 5. Value-Added Services: Look beyond basic pick, pack, and ship. Additional services can help set your brand apart. Remember, the cheapest option isn't always the best for long-term growth. Focus on finding a partner that aligns with your business goals and can support your expansion. What other factors do you consider crucial when selecting a 3PL partner? Share your thoughts below! 📦

Red Team Your TPRM: Stop Trusting, Start Testing We red team networks, apps, even employees. But when’s the last time you red teamed your third-party risk program? Here’s what that could look like: Step 1: Identify the Crown Jewels Pick 1–3 critical vendors: - What systems rely on them? - What data flows through them? - Who in your org is operationally dependent on them? Step 2: Simulate a Vendor Failure Create a scenario: - The vendor goes dark — total comms outage. - Their system is breached and down. - Their SLA isn’t honored. Now… let it play out internally. Step 3: Watch the Fallout - Do people know who to call? - Are internal teams aligned on who owns the response? - Can you pivot to an alternate vendor or workaround? - Can your business generate revenue without this vendor? - What data was exposed or at risk? Step 4: Score the Readiness Grade your internal response: - Speed: How long did it take to respond? - Clarity: Was there confusion or finger-pointing? - Resilience: Did the business grind to a halt? Step 5: Refactor Your Playbook This is where the real value is: - Adjust your contingency plans. - Build backup workflows. - Refine your vendor tiering criteria. - Add real-world failure drills to your TPRM lifecycle. Red teaming your vendor ecosystem shows you where your assumptions live. It turns static assessments into living, operational risk intelligence.