When should you use a 3PL

Signs it is time

If you are spending most of your week packing boxes instead of running the business, that is a sign. Same if you keep running out of shelf or garage space, if shipping errors are rising, or if customers in distant regions are asking for faster delivery than you can offer from one location.

Signs to stay in-house

If your order volume is low or seasonal, in-house fulfillment is usually cheaper and gives you more control over packaging and quality checks. Low-volume or highly custom products (engraving, kitting, fragile items) are often easier to handle yourself than to explain to a 3PL.

What changes once you use a 3PL

Your stock sits at the 3PL's warehouse, possibly split across more than one location. You still need to know how much is on hand and when to reorder from your supplier, but now you are also tracking stock in a place you do not physically see. Make sure your reorder planning accounts for the 3PL's own lead time to receive and shelve new stock, not just your supplier's lead time.

Cost and risk tradeoffs

3PL fees usually include storage, pick and pack, and shipping markup. Compare that total cost per order against your current fully-loaded cost of doing it yourself, including your time. Also check how the 3PL handles damaged or lost stock and how often they report inventory counts back to you, since gaps in that reporting can throw off your reorder numbers.

Step by step

1. List your current weekly hours spent on packing and shipping and put a dollar value on that time
2. Get a quote from one or two 3PLs for storage, pick and pack, and shipping at your current order volume
3. Compare the 3PL's all-in cost per order to your own fully-loaded cost per order
4. Ask the 3PL how often they report stock counts back to you and in what format
5. Add the 3PL's receiving and shelving time to your supplier lead time when setting reorder dates
6. Start with a subset of SKUs or one region if you want to test before moving everything
7. Review the arrangement after three months against your original cost and service assumptions

Worked example

Say you currently pack 40 orders a day yourself, taking about 3 hours of your time plus a part-time helper. A 3PL quotes $2.50 per order for pick and pack plus storage fees of $150/month for your volume. At 40 orders a day, 25 selling days a month, that is 1,000 orders x $2.50 = $2,500 plus $150 storage, so $2,650/month. If your own cost of time and labor already runs close to that, the 3PL mainly buys you back time rather than saving cash, which may still be worth it.

How SteadyShelf helps

SteadyShelf does not manage 3PL relationships, transfers, or per-location stock, it works off the total on-hand and on-order numbers in your store. If you move to a 3PL, keep your Shopify on-hand quantity accurate and add the 3PL's receiving time to your supplier lead time so order-by dates stay correct.

$29/month flat, unlimited products and suppliers, 30-day free trial. Run the numbers now with the free reorder point calculator.

SteadyShelf is launching on the Shopify App Store. Join early access to get the install link first.

Related guides

• Why inventory accuracy matters
• Why lead time matters more than you think
• Why safety stock is not wasted money
• When should you reorder a product

All inventory how-to guides · Inventory glossary

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