The announcement of Network Manager is a milestone in the history of Extensiv (formerly known as 3PL Central). For years we have been building software that helps third-party logistics companies (3PLs) operate their warehouses more efficiently by offering their customers visibility into inventory, order status, and accurate billing based upon all the activities in the warehouse. That has helped us grow into the clear leader in warehouse management for 3PLs, with more than 2,000 warehouses running our software.
During our time serving this market, consumer expectations have risen with fast, free delivery now the expectation. Because of this, it has become harder to offer competitive fulfillment from one or two warehouses. This has led to a new generation of fulfillment providers that are building “technology enabled 3PLs” that compete with our customers, most of whom are operating one or two warehouses, while purporting to “partner” with 3PLs.
Increasingly, we have seen new businesses that claim to “help” them actually become competitors, fighting to win the business from the online merchants our 3PL customers would normally sign. While this new technology driven approach is important to building the resilient supply chain of the future, 3PLs that do not retain ownership of their customer relationships are destined to be commoditized and undifferentiated service providers. That is a future no 3PL should welcome.
At Extensiv, we know there is a better way. First and foremost, we do not believe software vendors or “partners” should sell fulfillment services or operate warehouses that compete with their customers. We are true partners and do not sign contracts with your prospective customers.
Today’s announcement of Network Manager marks a significant new chapter in our mission. Building on our announcement of the Extensiv Fulfillment Marketplace which helps 3PLs win more business, and reinforces our commitment to helping 3PLs run their businesses more efficiently, we are announcing an important extension to our mission: helping our 3PL Warehouse Manager customers work better together to build the collaborative, distributed fulfillment networks of the future.
Network Manager does this by allowing 3PLs to partner with other 3PLs to build geographically distributed networks that can fulfill demand faster and more cost effectively than any of them could do on their own. We enable them to do this without spending millions of dollars on software development, while running the 3PL Warehouse Manager software they love. We have built the fourth-party logistics (4PL) software needed for this network, including global inventory and order visibility, business intelligence, and billing management. Just like our other products, Network Manager is cloud-based, reliable, and we will add new capabilities for years to come.
Simply put—Network Manager allows a 3PL to partner with other 3PL Warehouse Manager customers to build multi-node, geographically distributed fulfillment networks while maintaining ownership of their customer relationships. Inventory from online merchants can be spread across two or more warehouses with orders intelligently routed based upon virtually any business rule. Brands (your customers) can see the status of every order, regardless of which 3PL in your network is doing the fulfillment.
We realize that the opportunity to launch your own 4PL may be intimidating to many. Because of this, we are also announcing an array of services designed to get you started. Most importantly, we are announcing a new consulting offering that will help 3PLs contemplating this evolution get up and running in conjunction with other 3PLs. We also encourage you to consider Extensiv Fulfillment Marketplace to help find 3PLs interested in partnering.
In short, if you are a 3PL contemplating the future of your business, ask yourself a simple question: are the companies I am working with my partners or my competitors? At Extensiv, we believe the answer is easy: if they are looking to sign your prospective customers to their own contract and use you as a commoditized service provider, then you should ditch them and build your own network.
Written by Andy Lloyd
Andy Lloyd is a software innovator with more than 20 years experience at high-growth companies, ranging from startups to Fortune 100 companies. As CEO of Extensiv, Andy is passionate about driving strategy, innovation, and growth to logistics and supply chain businesses and their customers.