Common 3PL Pain Points

1. Rising Recruitment and Training Costs

Warehousing and logistics have always been labor-intensive industries. However, with increasing labor shortages and high turnover rates, finding and training new workers is becoming more expensive and time-consuming. The costs of recruitment and training can eat into the profit margins of 3PL providers, especially during peak seasons.

2. Fluctuating Seasonal Demand

3PL providers often experience fluctuating demand throughout the year, with massive spikes during shopping seasons such as Black Friday in the US, Singles’ Day in China, or any holiday season. During these periods, the demand for labor and warehouse capacity skyrockets, and companies either have to hire temporary workers or overstretch their current workforce. Both options come with high costs and risks.

3. High Error Rates in Manual Processes

In manual order-picking operations, human errors such as mispicks and incorrect shipments are common. These errors not only slow down operations but also lead to returns and dissatisfied customers, which can hurt a 3PL provider’s reputation and client relationships.

4. High Consumer Expectations

With the rapid rise of e-commerce, consumers now expect faster delivery times and real-time tracking. This places enormous pressure on 3PL providers to improve the speed and accuracy of their warehouse operations while maintaining low costs.

5. Complex Workflows

As warehouses become larger and more complex, managing workflows efficiently becomes increasingly difficult. 3PL providers handle a wide range of products, and the processes involved in picking, packing, and shipping them can vary greatly. This complexity can slow down operations and increase the potential for errors.