Why Your 3PL Should Have Multiple Warehouse Locations

Cruising for a new fulfillment partner? Dying to escape the confinements of a living room warehouse? Whatever your sitch may be, you likely have a checklist of the ideal 3PL. Tall, dark, handsome… wait, wrong checklist. Let’s try again: speedy, efficient, and cooperative to boot. Those are all great qualities to look for, but, if they end there, you’re likely missing a major green flag.

Multiple warehouse locations aren’t talked about nearly as much as they should be, which is a real shame! Being able to leverage your inventory across a variety of strategic facilities brings a host of important, profit-driving benefits. Allow us to explain!

#1. Faster and Cheaper Shipping

Upgrading your shipping game starts with expanding your shipping network. Why? Well, it comes down to shipping zones, which are geographic areas designated by shipping carriers to determine shipping rates and delivery times.

It’s always faster and cheaper to send a package to your Aunt Deborah down the street than to Grandma Muriel who lives on the other side of the country (poor Grandma Muriel). Even if we were to take logistical detours into account, a short-distance package would still be using fewer resources (time, fuel, manpower, etc.) than its long-distance cousin.

In other words, multiple warehouse locations translate to better service and happier customers!

#2. Efficient Inventory Management

As one of the most challenging aspects of order fulfillment, inventory management can be a real headache for newcomers and seasoned pros alike. While it may seem counterintuitive, splitting up your inventory is a super smart move, especially when you have the customer data to back it up.

For example, let’s say you’re an apparel store with a diverse catalog. A few months into selling, you realize that your swimwear performs far better in Florida than it does in Nebraska. In this case, having all your products jumbled up in one warehouse doesn’t make a ton of sense. Divide and conquer, right?

And, if you’re worried about your products being too far from home, fear not! Contrary to popular belief, being within walking distance of your logistics partner is not much of a necessity. With the right 3PL by your side, you should be able to confidently drop off your products so that they can be picked, packed, and delivered to your exact specifications!

#3. Access to Different Markets and Demographics

On a similar note to #2, multiple warehouse locations also allow you to gain access to opportunities that wouldn’t have been possible otherwise. 

Let’s go back to the apparel store example. Say you’re thinking of launching a new line of sun protective clothing. Naturally, you cross off the snowy states, instead focusing your efforts on places like Florida and Arizona. If your 3PL were only based in the Midwest, tapping into that demographic would be harder, and your shipping capabilities would suffer as a result. Ultimately, this would lead to a loss of potential revenue — no bueno!

With more resources at your disposal, the sky’s the limit when it comes to exciting product launches and bold marketing campaigns. 

#4. Improved Returns Processing

Say the word “returns” to a room full of eCommerce business owners and you’ll likely hear a collective groan. No matter what you sell, returns are pretty much unavoidable, which means baking a plan for them into your overall strategy is a must. 

You see, there are two sides of the shipping coin: outbound and inbound. While deliveries are certainly more exciting than returns, the benefits of fast and cheap shipping still spill over into quicker processing times and happier customers.

Now, does this mean you have to leave your beloved fulfillment partner behind in search of greener pastures? Not necessarily. If you’re still getting your bearings, it might be wiser to start small and branch out as your needs change. But, if you’ve been rockin’, rollin’, and know what you want, it’s only a matter of time until you have to leave the nest!

#5. Big Savings on Duties and Tariffs

Depending on their location, multiple warehouse facilities also allow business owners to enjoy dramatic savings on import duties and tariff fees. How is this wizardry accomplished, you ask? Section 321, we answer!

If you haven’t heard, Section 321 is U.S. shipment type that’s used to clear U.S. Customs and Border Patrol. While it does come with a few limitations (like a de minimis of $800), an experienced 3PL should be more than able to help you get the biggest bang for your buck. Read more about Section 321 here for a detailed outline of how it works and how you can qualify. It’s simpler than it sounds, we promise! (And yes, it’s 100% legal.)

Questions? Comments! Give us a holler — we’d love to hear from you!

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