Multiple sales channels and one 3PL: pallet, parcel or both?

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The demise of the retail store model is being overplayed and over exaggerated.  The argument can be made that 15 years of store and retail chain closings is not just about consumers migrating in mass over to the e-commerce sales channel.  It can also be argued that many legacy model retail stores are failing because they deserved to fail by not responding to change in the retail marketplace and adjusting to different consumer buying habits. It was inevitable that retail had to shrink, but retail is not going away, and nor is the fulfillment model that supports the retail store.

Multiple sales channels and one 3PL: pallet, parcel or both?

While the traditional retail mall model continues to fail, large outdoor marketplace style shopping complexes continue to prosper.  They offer a mix of destination venues, not just limited to traditional retail, that drive cross-over purchasing at those retail stores comingled across a mix of non-retail, destinations like consumer services and entertainment.

The evolution across retail is also driving change across the retail fulfillment space as a 3PL fulfillment services provider must now consider supporting a dual focus:

  • Continuing to support the pallet intensive B2B delivery of products to large retail stores.
  • Keeping up with increasing demands with respect to delivering the growing B2C, e-commerce driven, parcel home delivery.

In addition, some fulfillment 3PL’s are also starting to offer White-Glove, Home Delivery of Large and Bulky Items, which is a huge challenge, fraught with barriers to a successful delivery.

Supporting Both Pallet and Parcel Delivery:  3PL Required Capabilities:

Today, the best order fulfillment 3PL’s support both parcel (B2C) and pallet based (B2B) order fulfillment modes.  However, to do so requires a multidiscipline commitment to supporting two separate and distinct functions well:

  • Singular Client-Based Technology Interface for Pallet and Parcel: The order transfer process from Merchant to 3PL, and related technology for both modes should reside on a single platform to support client ease-of-use.  Additionally, the ability to pass through shipment and delivery related information/data to the merchant, and then to the recipient for both modes, is critical to a satisfied customer experience.
  • Cross Mode Carrier Relationships: It’s critical for the 3PL to maintain strong carrier relationships across both the parcel and freight carriers.
  • Facility Design and Functionality: New facilities are designed to efficiently support pallet and parcel fulfillment.  However, older building configurations must be retrofitted to efficiently accommodate dual shipping configuration product pick and flow.
  • Dual Shipping Mode Dock Capability: A single shipping dock for both parcel and pallets is an acceptable condition as long as dock access rules and 3PL management of those rules supports the unique requirements for each mode.
  • Cross-Trained Workforce Capability: Picking and processing both parcels and pallets is a very different process and employees must be properly trained to support both.

Many legacy 3PL fulfillment models still operate with a singular focus on parcel or pallet-based fulfillment services. However, the best order fulfillment 3PL service providers are supporting both parcel and pallet distribution modes to efficiently serve all the unique client fulfillment needs across all their individual clients.

Dean Maciuba is the Co-founding partner of Crossroads Parcel Consulting and contributing editor to the Newegg Logistics blog. This content has been republished with the permission of the author and Newegg Logistics, where the article originally appeared.

Photo: Maryland GovPics / Flickr / CC BY 2.0

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