22 Questions to Ask When Choosing a China 3PL Provider

As your eCommerce business thrives to a great capacity, you might not want to handle the tedious, time-consuming order fulfillment in house anymore. A great way out is outsourcing your fulfillment to a China fulfillment center. Choosing a reliable 3PL provider in China is like sourcing a new product supplier, and a new business partner can really make or break your business. It’s essential to find a fulfillment center that provides the services you need.

Order fulfillment, a vital step of any online business, requires fast and zero error delivery, or you would end up losing sales. You might have a highly sought after product, a captivating marketing campaign, five star reviews, however, if your order fulfillment is not run smoothly, your online business can’t mature. Fulfillment service provider isn’t a one-size-fits-all. The services provided by different fulfillment centers differ in the types of products they ship, services they provide, the amount they charge, etc. To help you find the best 3PL provider in China, here are 22 questions to ask a China 3PL provider before committing to a contract.

Questions to Ask a Third Party Logistic Provider

  1. What type of products do they specialize in?

Don’t trust a fulfillment center that tells you they can handle every kind of shipment. Every fulfillment center has their strengths and weakness. For example, if you sell heavy and bulky products like furniture, you’d probably go with an experienced service provider that knows how to handle heavy merchandise. If you sell products that are light but take up a big volume, special attention must be paid to the shipping fee as most carriers tend charge by volume. An experienced 3PL provider should know the best solutions of shipping different types of products.

Ask the 3P provider what kind of products they specialize in, and whether they’re fulfilling products similar to yours.

  1. What value added services do they provide?

Does the fulfillment center offer other value added services catering to your business operation, i.e., quality inspection, custom lettering, in-time delivery? An outsourced fulfillment center is an arm of your operation to take burden off your shoulders. If they fail to cater to your performance goals for your business, your online sales would fall short.

  1. Is there a setup fee for account and integrate with your eCommerce store?

In most circumstances it’s free. To avoid any hidden fees that can later lead to a business-killing expense, ask about all the charges related to account setup and integration with your eCommerce store.

  1. Is there a minimum monthly order volume or a fixed fee if the volume doesn’t reach the requirement?

Make sure your operation goals meet the requirements of the 3PL provider. This is essentially important if the products you sell have seasonal cycles, as you might be charged a minimum monthly fee during the low season.

  1. Do they work with your preferred carriers?

Make sure your service provider works with your preferred shipping carriers.

  1. Do they offer shipping discounts?

As 3PL providers ship a significant number of orders every day, usually they’re offered a much discounted shipping rate from leading shipping carriers. Make sure the discounts are passed onto you.

  1. What’s their shipment tracking system?

Make sure the tracking notifications are directly sent to you and your customers so you can follow the shipments.

  1. Can they meet the demand of increasing capacity as your business thrives?

One of the greatest perks for outsourcing your fulfillment is to focus on more strategic tasks like scaling. Imagine you launch a new marketing campaign and it goes viral, as your orders pour in, can your 3PL provider accommodate to your business at the speed of your online sales?

  1. Worst case scenario, can they reduce your shelves if your business contracts?

In every business, anything unpredictable can happen suddenly, i.e., the disruption of your market niche that you might have to cut off the expenses later. Make sure your service provider is ready to cater to these changes, supporting you through thick and thin.

  1. How many percentages of your orders can reach customers in two, three days or within five days from the 3PL warehouse?

Two-day shipping is the industrial standard for eCommerce giants. However, if your 3PL provider is based in China and your customers are from all over the world, it usually takes 5 business days to reach the end customers depending on location and carrier. Big online retailers are constantly looking for new ways to get the products to their customers fast. To stay ahead of the rat race, your 3PL provider should be able to provide a fast delivery solution.

  1. How many locations does the 3PL provider have?

Does your 3PL provider have a number of warehouses in different locations? Location is a vital aspect to get the goods in a timely manner to the end customers.

  1. Do they process orders on the same day?

Same-day order processing or 24-hour processing is the latest trend in logistics. Imagine you list two to three business days as standard delivery time to get the products to the doorsteps of the end customers, if the processing time to leave the warehouse takes over one day, you’re gonna break the promises, which is destructive to the reputation of a business.

  1. Do they have any guarantee for shrinkage?

Shrinkage refers to the difference in the amount of products you ship to the 3PL provider and the actual amount of stocks available on the shelves to ship to the end customers. Your items might be stolen, damaged or lost. Look for a reliable 3PL service provider with guarantee of no shrinkage or a low shrinkage allowance.

  1. What’s the error rate of the 3PL provider?

Look for a 3PL provider promising zero error rate or with guaranteed compensation for the costs if they miss pack your orders.

  1. Who pays for fulfillment mistakes?

Mistakes can happen especially in peak seasons when everyday they have to deal with a significant number of fulfillment orders. Check what kind of guarantees the fulfillment center offers if they pack or ship the wrong items. Will they compensate for the costs of their mistakes?

  1. How do they process returns?

Returns are unavoidable to any online business. A hassle free return policy can not only build loyal customer base but also help your business hum along smoothly.

  1. How fast do they process refunds?

Check how long it takes for your 3PL provider to process a refund after receiving the returned item. A speedy refund is vital to avoid negative reviews and unhappy customers.

  1. How do they deal with quality issues of returned items?

Some returns might come with defects while others not. Check whether there’s a series of quality inspection measures being taken to check quality of each returned item, whether they would put the ones in good conditions on shelves again, and keep the defective ones out of shelves to avoid damaging your reputation.

  1. Can 3PL provider handle customer service regarding the orders?

Check if your service provider can directly handle delivery inquiries since if the end customers call you, you would have to contact the warehouse to get the answer. Outsourcing customer service to your 3PL provider can help you get rid of the lion’s share of the work, thus, you can focus on more value added tasks. Another effective way out is real time tracking, check whether every step of order fulfillment is simultaneously recorded in the eCommerce store or not so customers can check every minute and know what’s going on.

  1. Do they have power backup?

Even though the fulfillment center is hit by a blizzard or is cut off electricity, customers in other parts of the world and the country still expect their orders to arrive as soon as possible. The operations and your orders have to be kept rolling regardless of what has happened. Make sure the fulfillment center has their backup systems that are frequently maintained.

  1. Do they have ISP backup?

Make sure your fulfillment center uses more than one ISP in case of internet outage. If your orders aren’t simultaneously sent to your eCommerce sales channels, they can’t be shipped.

  1. What kind of security does the fulfillment center have on site?

You wouldn’t want to risk losing or getting your inventory stolen when you’ve invested a big capital in the goods. You have to make sure whether the third party fulfillment center can keep your inventory safe and sound or not. Check if the fulfillment center has a series of security measures, like security camera, climate control, employee background checks, fencing as well as keeping your business secrets (customer name, address, contact information, ordering items) strictly confidential.

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