Laying the Foundation for 2021 Growth
With today’s warehousing and logistics technological landscape, what software partner your third-party logistics (3PL) warehouse chooses to work with can make or break your business. One analogy I like to use for choosing the right partner is a sports team and the importance of team chemistry.
I’ve been a passionate soccer enthusiast for over twenty years. If teams don’t have “chemistry” or the ability to work together cohesively and support each other on the field, teams lose games. To win games, it’s necessary for each part of the team–defense, offense, midfield, and even coaches–to work cohesively and consistently towards common objectives such as scoring goals or denying opponent advances up the field.
Similarly, your technology partners can help you reach your goals, whether those be customer acquisition targets, order volume growth levels, or customer-needed integrations with third-party software (e.g., ecommerce shopping carts), by advising you on industry best practices and serving as a technical extension of your warehouse staff.
72% of 3PLs Saw Order-Volume Increases Upon WMS Implementation
One of the core building blocks of a 3PL warehouse is a warehouse management system (WMS). According to our industry benchmark survey of 250+ 3PL professionals, 87% of warehouses have ranked a WMS as the number one-system and technology backbone for running and managing their warehouses. On average, 72% of those warehouses experienced order volume growth upon system implementation. Consider what WMS technology partner you work with. For example, Extensiv partners with warehouses to advise them on industry best practice workflows and even sets up third-party integrations with shopping carts and marketplaces for customers.
What Makes a Good Partner?
Besides understanding industry best practices, another must for a technology partner is having the capability to easily integrate with the systems that your customers demand. Below are some of the most common integrations that 3PLs connect to:
Source: Extensiv Benchmark Report
The top three integrations that 3PLs need are EDI, shopping cart connectivity, and order management systems. A few warehouse management software options are platforms that can integrate with these systems, such as Extensiv 3PL Warehouse Manager.
Extensiv 3PL Warehouse Manager can serve the needs of retail fulfillment warehouses by offering EDI connectivity and ecommerce fulfillment warehouses by connecting to shopping carts such as Shopify and order management systems.
What to Ask When Selecting a Partner
Break down your questions into two types, technical requirements and partnership requirements. Here are five questions you should ask a WMS provider before choosing them as your technical partner:
- What integrations do you offer?
- What are the steps involved in setting up these integrations?
- Do you have ongoing technical support services in case we run into technical issues?
- How can I align my warehouse setup and workflows with industry best practices?
- Can you help me with warehouse staff training or setting up new customers?
Here are five questions you should ask to determine if they are the right relationship partner:
- Will the warehouse management system partner actively advocate for your needs?
- Does the partner have staff dedicated to your customers’ success with the software?
- Will your partner educate you in 3PL industry trends?
- Will the software provider give you industry benchmarks?
- Does the partner have developer enablement services to extend your team?
Laying the Foundation for Growth in 2021
Let’s say you’ve evaluated several WMS vendors and narrowed down your list to your top three partner choices as part of your request for proposal (RFP) process. How do you make a final decision? Try framing your choice in terms of which partner will position your warehouse for the highest growth this coming year. We’ve learned that the top reason 3PLs don’t adopt a WMS is that it’s too expensive and too complex to setup. To overcome these barriers, look at how they can help you adapt to the change and ultimately help you achieve the highest return on investment from adopting a WMS. Analyze whether the WMS provider has supportive staff and people who you can count in case of any issues that arise. Some warehouse management software service providers even simplify the setup process through internal training and setup services so you don’t have to worry about that setup complexity.
To learn about Extensiv’s Consulting Services, go to Extensiv Services.