In this episode of The New Warehouse, Kevin interviews Aaron Hodes, an enterprise account executive at ShipBob. ShipBob is a tech-enabled third-party logistics provider specializing in logistics and fulfillment services to small and medium-sized e-commerce brands. The company’s proprietary technology stack powers its network of warehouses worldwide, allowing them to offer fast and cost-effective fulfillment services. Aaron and Kevin discuss what to look for in a 3PL, upcoming challenges, and the importance of inventory accuracy for e-commerce brands.
What’s Happening in E-Commerce?
Aaron says the pandemic has highlighted the importance of supply chain visibility, an area of business previously overlooked. He notes that the macroeconomic environment and issues related to advertising and marketing have made for difficult times for third-party logistics (3PL) providers. Aaron acknowledges the challenge of providing transparency within 3PL relationships but believes expectation setting is essential to such a relationship.
What Should E-Commerce Brands Look for in a 3PL?
According to Aaron, e-commerce brands should look for a 3PL partner that provides visibility and transparency regarding inventory and order accuracy. Establishing a relationship with a 3PL that allows for accurate two-way communication can help ensure the fulfillment process runs smoothly and reduce problems in the long run. Brands should also assess their customer’s needs when choosing shipping services, as this will help them maximize their long-term vision for the brand. Finally, Aaron suggests that brands have weekly conversations with their 3PL to stay updated on industry changes and continue improving.
Why Inventory Control is so Important to E-Commerce Brands?
Aaron stresses the importance of live inventory syncs between e-commerce stores and the 3PL provider regarding inventory control. He also recommends establishing a routine for quarterly or annual cycle counts to ensure accuracy and avoid any implications for the accounting and finance team. Finally, Aaron suggests pressuring the 3PL on order and inventory management details, as accurate numbers are essential for running a successful brand.
- E-Commerce brands should assess their current or potential 3PLs by looking at their inventory control practices, such as live inventory syncs, quarterly cycle counts, and annual physical counts.
- As e-commerce brands move towards other sales channels, such as wholesale and brick-and-mortar retailers, they should look for a 3PL with core competencies in both areas.
- Consumers care more about the accuracy of delivery dates than speed, and shipping options are becoming increasingly popular.
The New Warehouse Podcast