From warehousing and shipping to inventory and returns, a third-party logistics provider helps streamline operations and cut costs. But choosing the right one isn’t always easy. If you’re wondering how to select a third-party logistics provider that meets your needs, this guide highlights the key factors to consider.
How 3PLs fit into your supply chain and why the right one matters
A third-party logistics provider (3PL) takes over key logistics functions. Consider a 3PL as an extension of your operations. They receive your inventory, store it in strategically located warehouses, pick and pack orders, and ship them using their own carriers or freight partners. Many also manage reverse logistics and international freight, including customs paperwork.
This model offers more than just convenience. A reliable 3PL provider can reduce shipping times, lower overhead costs, and help you navigate seasonal spikes without heavy investment. But pick the wrong one and you could face missed deliveries, inventory issues, or frustrated customers.
Here’s what top-tier third-party logistics providers bring to the table:
- No upfront investment in warehouses or staff
- Flexible, pay-per-use pricing based on your volume
- Faster fulfillment and fewer operational headaches
- More time to focus on what matters: growing your business
Now, let’s explore what to look for when choosing a third-party logistics provider.
Step 1: Start with an internal logistics audit
Before evaluating any 3PL, take time to assess your own logistics needs. It serves as the foundation for selecting the right partner and avoiding costly mismatches.
Ask yourself:
- What are you trying to achieve by outsourcing? Is it cost savings, faster deliveries, or reducing operational complexity?
- What types of products do you ship? Do they require special handling, such as temperature control or hazardous material protocols?
- What’s your average order volume, and how much does it vary throughout the year?
- What is the geographic reach of your current distribution network?
Step 2: Shortlist third-party logistics providers based on service fit
Once you understand your needs, it’s time to narrow down the list of potential 3PL partners. Here’s what to look for when building your shortlist:
1. Industry experience and service capabilities
Not all 3PLs are equipped to handle your specific products or shipping profile. A provider that specializes in B2B freight won’t be the best fit for high-volume e-commerce fulfillment—and vice versa.
Ask:
- Do they have experience with products like yours?
- Have they worked with businesses in your industry or on your target shipping routes?
- Can they handle your volume and offer services like warehousing, transportation, reverse logistics, or specialized fulfillment (e.g., cold chain or oversized items)?
Also, check if they offer value-added services, such as repackaging, labeling, or FBA prep that could save you time down the line.
2. Technology and system integration
A modern 3PL should offer more than just forklifts and pallet racks. They should provide real-time visibility and seamless integration with your existing systems.
Evaluate:
- Do they provide WMS (Warehouse Management System), TMS (Transport Management System), and live inventory tracking?
- Can their system integrate with your ERP, Shopify, Amazon, or other platforms via API?
- Do they offer forecasting tools or analytics dashboards?
3. Geographic coverage and delivery network
Your 3PL’s warehouse locations and transportation lanes can significantly impact your shipping speed and cost efficiency.
Look into:
- Where are their warehouses? Are they close to your customers or ports of entry?
- Can they support both domestic and international distribution?
- Do they offer last-mile delivery and return logistics?
4. Performance standards and SLAs
Reliable service is non-negotiable. Ask how the third-party logistics provider tracks performance and which key performance indicators (KPIs) they use to measure success.
Questions to consider:
- What’s their average on-time delivery rate?
- How do they track order accuracy and return rates?
- Do they offer transparent reporting and regular reviews?
5. Flexibility and risk management
Your logistics needs will evolve as your business expands. The top 3PL providers adapt alongside you.
Check:
- How do they handle seasonal peaks or unexpected volume surges?
- What contingency plans do they have for delays, weather events, or supply chain disruptions?
- Do they offer optional services like insurance, kitting, or custom packaging?
6. Reputation and client references
Don’t just take their word for it—look for social proof.
Tips:
- Check online reviews and third-party rating platforms
- Ask for customer testimonials or case studies
- Request a site tour or to speak with an existing client
7. Transparent pricing structure
No one likes surprise charges. Understand exactly what you’re paying for and how costs scale.
Clarify:
- Is pricing based on a per-order, per-unit, or flat-rate model?
- Are storage, pick-and-pack, and shipping included or billed separately?
- Are there any setup fees, monthly minimums, or hidden surcharges?
Step 3: Make a confident final choice
Don’t focus on cost alone
While pricing matters, prioritize reliability, scalability, industry expertise, and the flexibility to support your future growth.
Define clear SLAs
Spell out expectations for fulfillment speed, inventory accuracy, and issue resolution. Avoid vague terms; set measurable standards.
Look for long-term compatibility
Think beyond the first year. The best 3PL providers feel like part of your team and can support your expansion across regions or channels.
Prioritize communication
Select a provider that keeps you informed with proactive updates and quick responses.
Ready to find a trusted third-party logistics provider?
Airsupply (ASLG) delivers end-to-end lead logistics solutions built to scale with your business. With over 10 years of global experience and a presence in more than 130 countries, ASLG combines deep industry expertise with powerful digital tools. Our goal is to provide you with full visibility, flexibility, and control across your entire supply chain.
