Understanding 3PL in Simple Terms

If you run an ecommerce business, manage a product-based brand, or are scaling up operations, you’ve probably come across the term “3PL” more than a few times. But what exactly is it? And why does everyone keep talking about it like it’s the key to streamlined success?

Let’s break it down in plain English—no buzzwords, no complicated industry jargon. Just a clear look at what third-party logistics (3PL) is, what it does, and how it can actually help businesses work smarter, not harder.

What is 3PL

3PL stands for third-party logistics. It’s when a business hires an outside company to handle part (or all) of its logistics operations. That can include warehousing, picking and packing, shipping, inventory management, returns, and more.

Think of it this way: if your business sells products, 3PL is the behind-the-scenes team that gets those products from point A to point B—without you having to do it all yourself.

Rather than leasing warehouse space, hiring fulfillment staff, negotiating with shipping carriers, and managing inventory software on your own, you partner with a 3PL company that already has all of that in place. You focus on selling and growing your brand, while they handle the logistics.

The Role of 3PL in Ecommerce

For ecommerce brands especially, 3PL services are a game-changer. Why? Because online shopping is all about speed, accuracy, and customer satisfaction. And let’s face it—handling hundreds or thousands of orders a month from your garage or small warehouse can get overwhelming fast.

How 3PL fits into ecommerce fulfillment

• Storage: Your products are stored in the 3PL provider’s ecommerce warehouse.

• Order fulfillment: When a customer places an order, the 3PL picks, packs, and ships it on your behalf.

• Returns: Most 3PLs also manage returns, making the process smoother for both you and your customers.

• Shipping discounts: Many fulfillment companies for ecommerce have bulk shipping rates you wouldn’t be able to access on your own.

This setup is especially valuable for growing businesses that want to scale without building out their own infrastructure.

3PL Services You Should Know About

Not all 3PLs offer the same things, so it helps to know what services to look for when evaluating your options.

Common 3PL services include

• Receiving and storage: Your inventory is delivered and stored in a secure ecommerce warehouse.

• Pick and pack: When an order comes in, items are pulled from storage and packaged for delivery.

• Shipping and tracking: Orders are shipped using trusted carriers, and tracking is provided to you and your customers.

• Inventory management: Many 3PLs offer real-time inventory tracking so you always know what’s in stock.

• Returns processing: Returns are handled professionally, helping you maintain a positive customer experience.

Some 3PL fulfillment companies also offer value-added services like kitting, subscription box assembly, and custom packaging.

Choosing a 3PL Provider That Fits

It’s not a one-size-fits-all decision—what works for one brand might not work for another. When you're looking at different 3PL fulfillment companies, here are a few questions to ask.

Questions to consider

• Where are their warehouses located? If most of your customers are on the West Coast, using a provider with a Utah-based facility (like many fulfillment companies in Utah) could reduce shipping times and costs.

• Do they specialize in ecommerce fulfillment? Some 3PLs are better equipped for online retail than others.

• What platforms do they integrate with? Look for seamless integrations with your ecommerce platform (Shopify, WooCommerce, Amazon, etc.).

• Can they scale with you? Choose a provider that can grow with your business, especially if you're planning to expand your product line or target market.

• What’s their track record? Look for reviews or case studies that show how they’ve helped similar brands.

Partnering with the right provider can make your life a lot easier—but rushing into the wrong one can cause frustration, delays, and extra costs. Do your homework, ask questions, and prioritize fit over flash.

The Pros and Cons of Using 3PL

No solution is perfect, and using a 3PL comes with both advantages and trade-offs.

Pros of 3PL

• More time to focus on business growth

• Scalable operations without investing in infrastructure

• Professional handling of logistics and shipping

• Faster delivery options for customers

• Potential savings through bulk shipping discounts

Cons of 3PL

• Less control over the fulfillment process

• Initial onboarding can take time

• Monthly fees or per-order charges can add up

That said, for many businesses, the pros outweigh the cons—especially once order volume starts picking up and internal fulfillment becomes unsustainable.

Who Should Consider 3PL Services

If you're processing more than a handful of orders each day, feeling overwhelmed by fulfillment, or struggling to keep inventory organized, it's probably time to explore 3PL services.

Similarly, if you're planning a product launch, running a seasonal promotion, or expanding into new markets, having a 3rd party warehouse company ready to scale with you can be a huge asset.

Even small businesses can benefit. You don’t need to be shipping thousands of packages a month to get value from third-party logistics.

Why Understanding 3PL Helps You Stay Competitive

Customer expectations are high. They want fast, affordable shipping, easy returns, and updates along the way. The logistics behind all that can be daunting—but understanding 3PL gives you a leg up.

When you know how fulfillment works and what 3PL services are available, you’re better equipped to make smart decisions that save time, money, and headaches. You’re not just shipping boxes—you’re building a customer experience that drives repeat business.

Plus, with new tools and data integration, 3PLs can give you better visibility into your inventory, sales trends, and shipping metrics—helping you make more informed business moves.

Working With FlatOut Fulfillment

At FlatOut Fulfillment, we work with growing ecommerce businesses to provide smart, scalable third-party logistics solutions. Whether you're shipping your first 100 orders or scaling to 10,000, we offer customized support that fits your business. Check out our amazing array of services, here to help your business grow!

If you're looking for a reliable 3PL fulfillment company that understands what it means to grow an online brand, contact us to see how we can help. Let’s take fulfillment off your plate—so you can focus on building your brand.