Long before you begin the RFP process with third-party logistic providers, you should take the time to identify what you need from a distributor. Your company has specific requests based on your customers and your product, and it’s important to evaluate yourself before you can successfully evaluate a 3PL provider.
How Difficult Is Your Product To Distribute?
The capacity for distribution varies from one 3PL to the next. So you need to take stock of how much product you need to distribute and, more so, how difficult your product is—size, shape, weight. When you have a good understanding of your product, you will know how well your 3PL can meet your needs.
How Much International Trade Is Involved?
How often are you working with manufacturers from other countries, and how much product are you relying on them for? Part of evaluating a 3PL will depend on your international trade needs. Some 3PLs will have the capability to process international sales and imports—others won’t.
Who Are Your Customers?
When evaluating a 3PL, you’ll need to think about your customers’ needs. How much product are you going to need to distribute per quarter? How fast can you gauge how much product you’ll need to distribute in the next month? These questions are all based on your customers’ needs, so it’s important that you can have an accurate idea of who your customers are and how a 3PL might be able to service what they need.
How Much Do Investors Care About Your 3PL?
When you partner with a 3PL, you merge both of your reputations—your company and theirs. Their history as a company is now a part of your reputation, and some investors pay attention to that. Before you begin choosing which 3PL to partner with, you should spend time speaking to investors and gauging how much your partner affects confidence in your company.
Where Do You Need To Distribute?
3PLs vary when it comes to their distribution capabilities—be it local or cross-country. When you know where your product needs to go, you’ll be able to evaluate a 3PL based on their distribution routes. Once you’ve been able to gauge exactly where your product needs to go, you can evaluate how well a 3PL can achieve this.