Best 3PL Fulfillment Companies to Manage Logistics of eCommerce Sellers in 2023
eCommerce in India is booming and correspondingly, so is the 3PL fulfillment industry. Different agencies have shown that the demand for third-party logistics companies is bound to grow steadily. Technavio, a UK-based research firm, has predicted the industry to grow at a CAGR of 8% and by $10.74 Billion between 2021 – 2025. Similarly, Mordor Intelligence has predicted a CAGR of 11% for a similar period. This growth is fuelled by sectors such as eCommerce, FMCG, manufacturing, and retail.
Yet, not many sellers are aware of the advantages, features, and services of 3PL fulfillment companies. So here are a few points to help sellers get a better understanding of this industry and how a symbiotic relationship can be established between eCommerce and 3PL fulfillment companies.
- What are Third Party Logistics or 3PL Fulfillment Companies?
- Why is Logistics a Headache for eCommerce Players in India?
- How can 3PL Fulfillment Companies Help with Logistics Management for eCommerce Businesses?
- What are the Typical Offerings of 3PL Fulfillment Companies?
- How to Select the Right 3PL Fulfillment Company for Your eCommerce Business?
- Which are the Top Third-Party Fulfillment Companies?
- Common Misconceptions Regarding 3PL Fulfillment Companies
- 3PL Fulfillment Companies FAQs (Frequently Asked Questions)
What are Third Party Logistics or 3PL Fulfillment Companies?
3PL Fulfillment Companies are the companies to whom the entire order fulfillment cycle can be outsourced when the online seller wants to move away from self-fulfillment or doesn’t want to manage the operations in-house. These third-party logistics fulfillment companies provide eCommerce logistics, inventory management, warehouse management, packaging services, and other aspects of the fulfillment cycle for either a specific portion or the entire supply chain operation.
This helps sellers maintain an asset-light and non-capital-intensive business model, thus increasing their liquid capital and allowing the seller to focus on improving their business while the 3PL fulfillment companies improve the supply chain efficiency.
WareIQ, an eCommerce fulfillment company, empowers online brands with a superior-tech platform to compete with Amazon like service levels by bringing their average delivery timelines from 5-10 days to 1-2 days.
Why is Logistics a Headache for eCommerce Players in India?
India, a country with diverse geographical features, cultural practices, and infrastructural progress, is bound to present logistical challenges to eCommerce players.
Some of the predominant issues being faced are:
Reliance on roads for freight transport
With transportation by roads being the preferred means of freight movement for eCommerce players, two dominant issues, as highlighted by a report issued by the consulting firm McKinsey and the Indian Institute of Logistics, are:
- India’s over-strained highways
- Acute shortage of drivers
Lack of internet connectivity and digitization
With low internet penetration, stages of the logistical segment remain constrained, due to the lack of technological infrastructure in certain areas. The sellers do not have access to adequate transportation facilities.
With some of the older players in the industry being slow to digitalise, stages of the logistical network undergo significant delays as there is an information delay between the transportation service and the reseller.
Deteriorated law and order situations in some regions of the country lead to pilferage, theft, or even hijacking of the cargo, leading to additional expenses and loss of inventory and time.
Pay-On-Delivery is the primary method of payment
With “Cash-on-Delivery” (COD) being the end customer’s most preferred means of payment, additional time is spent on cash collection and handling by the last-mile delivery personnel.
A high number of returns
Though this is a global trend, the eCommerce players in India consistently witness a higher number of returns. This causes the logistical players to ensure a reverse logistical flow at no additional cost to the end customer.
Inconsistency in postal codes and incorrect delivery locations
Despite being one of the largest postal systems in the world, there can be issues with the postal code of the end-user, leading to the last-mile delivery personnel having to call and confirm with the end customer.
Many infrequent or first-time eCommerce users tend to make errors in inputting their addresses, leading to subsequent issues.
How can 3PL Fulfillment Companies Help with Logistics Management for eCommerce Businesses?
A seller might have the product of the century and it might be the next big revolution in the tech sector. But the harsh reality is that it would all be worthless if the seller is unable to deliver the product to the customer’s doorstep without incurring significant costs.
This is where 3PL fulfillment companies step in to cater to the following essential needs of the seller, which are:
By simply using Economies of Scale, 3PL fulfillment companies handle multiple sellers and, thus, manage to distribute the costs of transportation among many parties. This allows the individual seller to incur significantly lower costs. The seller can also maintain an asset-light model without investing capital in infrastructures such as warehouses and trucks.
You May Like: Know About Types of Warehouses.
Offering greater coverage
Third-party fulfillment companies have established logistical networks to provide services to sellers. An individual seller may not be able to deliver a product to a customer in some location, but with established resources of 3rd party fulfillment companies, such as existing warehouses and supply chains, these companies can not only fulfill the seller’s needs but also a strategic location.
Offering faster delivery time
In this era of same day / next day delivery needs, 3PL fulfillment companies, with their warehouse network, trained staff, and advanced technology, meet the service levels promised by sellers and can help smaller sellers compete with their competitors who may be the bigger players in the industry.
Taking advantage of scalability
Demand undergoes a cyclic trend, and this trend varies weekly and monthly. Thus, to provide a cost-effective way for sellers to meet the varying need of customers during the entire year, third party fulfillment companies provide sellers with flexibility and scalability to handle the variation in demand.
Thus, 3PL eCommerce fulfillment companies can help eCommerce sellers by offering a better consumer satisfaction level, overall. Customers receive their orders on time or faster, irrespective of their geographical location, and without additional shipping charges; all of these factors lead to a heightened level of customer satisfaction.
What are the Typical Offerings of 3PL Fulfillment Companies?
Third-party fulfillment companies strive toward offering an end-to-end solution to eCommerce companies, and all 3PL companies provide the following services:
- Inventory management
- Logistics solutions (First mile to last-mile delivery)
- Warehouse management
- Freight forwarding
- Financial solutions for freight forwarding such as letters of credit
How to Select the Right 3PL Fulfillment Company for Your eCommerce Business?
Probably one of the most important decisions a seller will have to take is to decide which third party fulfillment company to choose for their products. To help such sellers out, here are some questions they must ask. This shall aid them in choosing the best 3PL fulfillment company for their requirements.
- How technologically sophisticated are 3rd party fulfillment companies?
- The world is advancing rapidly and so is the logistics sector. In this era of live tracking and same day / next day delivery, a seller needs a third party fulfillment company that can keep a seller informed and ahead of their competition.
- Can the 3PL fulfillment company match your growth?
- If an innovative product does not manage to reach its target customer sitting halfway across the country, or the reach is slower, and a competitor picks up on the idea and launches a similar product with a broader and faster reach, it will be game over for the seller.
- Is the third-party fulfillment company financially strong?
- In an asset-heavy industry such as the logistics sector, it is vital for any seller to ensure their 3PL fulfillment company is financially strong, especially during unaccounted disruptions and emergencies.
- How deep is the third party fulfillment company’s talent & How well are they ready for adverse situations?
- It is crucial to understand the depth of the third-party fulfillment company’s experience pool because it shows how well they understand the industry and how good their contingency measures are.
Which are the Top Third-Party Fulfillment Companies?
India is booming with all the third party fulfillment companies on offer, all competing to be the most prized and trusted by sellers and end customers alike. With a booming eCommerce sector and, subsequently, the 3PL fulfillment sector, there are many competitors. But here are 7 of the top 3PL fulfillment companies for small/medium businesses or large businesses.
Each company has been mentioned along with some of its services or features which act as a differentiating factor against the other players.
Established in 2019, WareIQ, a Y-combinator backed startup, has rapidly grown to be the leading provider of full-stack eCommerce 3PL fulfillment tech solutions for some of the most reputed brands in India. WareIQ offers a full-stack platform for 3PL logistics companies to enable same-day delivery and next day delivery to customers – an Amazon Prime-like experience but accessible to everyone.
WareIQ as a 3PL company has empowered brands to sell more, sell faster & sell everywhere due to:
- Access to WareIQ’s strong nationwide network of fulfillment centers & urban dark stores near their customers
- Access to all major national & hyperlocal last-mile couriers at discounted rates for making same/next day deliveries possible
- Easy integration across multiple online platforms & marketplaces
- Access to a superior centralised tech platform for eCommerce operations
- ML-based prediction engine for efficient warehouse network design & smart inventory placement
- Centralised platform for core fulfillment & shipping operations
- Post-shipping apps for a delightful experience & zero to minimum supply chain leakages (Branded tracking page with smart marketing placements; Trigger-based updates & smart communication platform)
WareIQ has customised offerings for merchants experiencing different order volumes as well as having different delivery speed expectations. WareIQ is probably one of the very few fulfillment tech companies in the world that have same-day delivery service for their customers under their product “WareIQ RUSH”.
With world-class WMS functionalities, WareIQ handles the entire range of intricate operations in the eCommerce fulfillment process, ranging from Inbound Operations such as scanning and quality check, through 100% accurate Pick and Pack, to Inventory Management across all channels. WareIQ’s next day delivery and same-day delivery services are helping eCommerce businesses set new standards with respect to setting customer expectations and fulfilling them with high efficacy. At the same time, WareIQ customers realise significant cost savings and wider reach due to better negotiations with shipping partners, strategically placed warehouses, economies of scale and scope in eCommerce warehousing, and data-driven decision making.
WareIQ’s WMS, a centralised tech platform helps to better manage undelivered orders by reducing NDR processing time by 12 hours – a multifunctional NDR dashboard helps to track and take immediate action for undelivered orders in real-time, thereby reducing RTO by up to 10%. Automatic replenishment recommendations and easy purchase order creation capabilities on the WareIQ platform further empower eCommerce companies to leverage all possible ways of increasing their ROI.
300+ brands, such as The Man Company, Future Group, Kama Ayurveda, and Wingreens Farms, have trusted WareIQ as reliable partners in their growth journeys. No minimum order quantity requirements make it suitable even for eCommerce firms having low order quantities to take advantage of the latest trends such as next day delivery and same day delivery. The onboarding process is simple, convenient, and less time-consuming, while the pricing policy is clear and transparent. WareIQ also undertakes strict safety precautions at its warehouses and complete ownership of the operations, thereby minimising the risk exposure of WareIQ customers.
Suggested Read: Check out the list of best Warehousing Companies.
Delhivery Third Party Fulfillment
Delhivery, since its inception, has successfully fulfilled over 1 billion orders across India. Their aim is to build an efficient operations model for business, through a combination of world-class infrastructure, cutting-edge engineering, and technology capabilities, and logistics operations of the highest quality.
- It is one of India’s largest and most popular 3PL logistics and fulfillment companies that is also homegrown.
- It offers end-to-end fulfillment solutions.
- It serves over 17,000 pin codes and 175 cities.
- It offers features such as sending tracking details to customers through SMS.
- It provides same-day/next-day delivery options.
- It provides multiple payment options at the time of delivery.
Blue Dart Logistics
Blue Dart is a prominent transportation and distribution company that utilises air as its primary source of transport, in South Asia. It offers delivery and logistics services to 35,000 plus locations in India. A part of the DPDHL Group (DHL Express, DHL Global Forwarding & DHL Supply Chain), Blue Dart has access to the largest global logistics network that includes more than 220 countries and offers a wide range of facilities, such as air express, freight forwarding, supply chain solutions, and customs clearance.
- It has an unparalleled logistical network spanning over 220 countries and is one of the largest third-party fulfillment companies in the world.
- It caters to 35000 locations within India with a forward and returns logistical network.
- It has experience and expertise in regulatory and customs operations.
- It has a net service level of 99.96%.
Ekart Logistics & Third Party Fulfillment Company
Ekart Logistics is one of India’s premier 3PL logistics companies. Commencing operations in 2009 as Flipkart’s in-house supply chain subsidiary, Ekart became a household name when it came to metrics such as customer experience, punctual delivery, and management processes. They offer complete end-to-end fulfillment services.
- It was originally created to handle Flipkart’s fulfillment but now caters to many other sellers.
- It is one of the more popular 3PL fulfillment companies in India because of its low rates and express delivery options.
- It has same-day delivery available in 13 cities and next-day delivery available in 50 cities across India.
- It provides end-to-end fulfillment solutions.
- It provides real-time data for sellers to ensure their service level promises are being adhered to.
Shadowfax We Deliver
Shadowfax was founded in Bangalore in 2015 and offers delivery and fulfillment services that are centered around a technology-based platform and hyperlocal delivery. The company has emerged as India’s largest hyperlocal delivery service and offers on-demand hyperlocal delivery services with analytical platforms to track the entire process.
- It serves over 7000 pin codes and 500+ cities.
- It provides marketplace and warehouse pickups.
- It offers low-cost hyperlocal delivery.
- It provides express contactless delivery with multiple doorstep payment options.
Mahindra Logistics Ltd
Mahindra Logistics Limited is a branch of Mahindra, a name that most people will be familiar with as a major player in the automotive industry. A logistics and distribution company that has a significant presence across India, its primary offerings include technology-focused logistics solutions and distribution facilities, especially in rural areas.
- It is part of a reputed conglomerate company.
- It has India’s largest warehousing facility at a single location.
- It serves over 400 clients.
- It focuses on sustainability and, thus, has introduced Electronic Vehicles in its last-mile delivery.
XpressBees 3PL Fulfillment Company
XpressBees 3PL Logistics Company was formed in 2015 in Pune, Maharashtra. They have emerged as one of India’s most rapidly growing companies in the logistics service sector. They offer end-to-end supply and distribution services.
- It caters to the end-to-end fulfillment needs of sellers.
- It covers 13000+ pin codes, 100+ hubs, and service centers.
- They are seasoned professionals, providing tech-based solutions.
- It has state-of-the-art logistics centers spread across the country.
- It provides 3PL fulfillment for products ranging from chemicals to heavy items like machinery.
Common Misconceptions Regarding 3PL Fulfillment Companies
Despite there being multiple players in the market and many of them known to sellers and the general public alike for many decades, there are still a few misconceptions that exist regarding third party fulfillment companies. Here, we shall address them so as to clear them out and leave no room for doubt in the minds of sellers.
- 3PL fulfillment companies are expensive to outsource to
- Third-party fulfillment companies use economies of scale to even out the costs among the many sellers and, thus, help to reduce the financial burden from the sellers’ shoulders. They reduce the recurring costs and capital expenditures that the seller would otherwise have to invest in.
- 3PL fulfillment companies are not for SMEs but MNCs
- On the contrary, MNCs have realised the cost-effectiveness of third party fulfillment companies. They do have small and medium-sized businesses that previously assumed third-party fulfillment companies to be too costly.
- 3PL companies only handle bulk volume orders
- Many third fulfillment companies do not have a minimum order quantity because they club orders of different sellers who reside in a specific location and, thus, manage to reduce the logistics costs.
- 3PL fulfillment companies take away control from the seller
- Third party fulfillment companies are extremely tech and data-driven, thus, providing numerous reports that provide sellers with better insights and knowledge. This gives the sellers more control over their products as they can understand where and how much their product is selling.
The product is the seller’s pride and joy and every seller wants that their hard work, investment, and ambitions, which take the shape of the product they are selling, reach the end customer as promised. So be it an FMCG, MNC, or someone who is working out of their flat, the requirement is the same and that is where 3PL fulfillment companies provide a common platform where every seller stands to gain by being part of a larger ecosystem.
With the above points that highlight the features and also the common misconceptions about 3PL fulfillment companies, sellers can now make a more informed decision about their choice of a third party fulfillment company that will help the seller climb the ladder of success. We hope you found this article interesting. We recommend using WareIQ for all your third party fulfillment requirements.
WareIQ is a category-defining, best- in class full-stack eCommerce fulfillment tech platform (with inbuilt inventory planning, order management & eCommerce shipping system) for modern brands to accelerate online sales/ expedite revenue growth & profits with same/next-day delivery.
We not only help you reduce your logistic costs but also your delivery timelines – this could be the game-changer your business needs!
WareIQ, a Leading 3PL fulfillment company in India offers centralised tech platform for your entire eCommerce operations
- ML-based prediction engine for efficient warehouse network design & smart inventory placement
- Centralized platform for core fulfillment & shipping operations
- Post-shipping apps for a delightful experience & zero to minimum supply chain leakages
- Pan India Fulfillment & Darkstore Network: Plug-and-play fulfillment infrastructure with no minimums, which is compliant with Amazon Seller Flex, Flipkart Assured, Myntra and other marketplaces
- Inventory & Network Planning Excellence: Best-in-class AI models for sales forecasting, product segmentation, and inventory management to reduce inventory by 40% and increase revenue by 10%.
- Vertically Integrated Fulfillment Tech Stack: Our Fulfillment Tech Solution supports integrations with 20+ top marketplaces & D2C platforms, and prominent national, regional and hyperlocal couriers, enhancing reach by covering deliveries for 27,000+ pin codes
- Supply Chain Productivity Applications: Integrate a host of supply chain productivity apps with a single-click to your existing CRMs, ERPs & accounting software to manage your logistics workflows from one command center. Use Apps like RTO Shield to get 100% RTO protection, Branded Tracking to turn your order tracking page into a profitable marketing channel, and many more.
Trusted by 300+ top Indian brands, we are helping them accelerate online sales and expedite their growth through a synergistic combination of advanced technology, robust fulfillment infrastructure & seller enablement services!WareIQ is backed by leading global investors including Y Combinator, Funders Club, Flexport, Pioneer Fund, Soma Capital, and Emles Venture Partner.
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