15 Tips to Choosing the Best 3PL Provider – A Checklist

Your 3PL provider is one of the most important partnerships you’ll have. Choosing the best 3PL provider is crucial to your business’s success, especially now more than ever. Everything is on the line for you here – your customer service reputation, customer brand loyalty and most importantly, the basic logistics you need to run smoothly so your daily operations can run as effectively as possible. 

Learn our top 15 questions to ask when you’re looking for the best third party logistics definition (3PL) provider. Your business literally depends on it.

TOP QUESTIONS TO ASK A 3PL PROVIDER:

1. How long have you been in business?
   *2+ years of successful operation and stability is optimal
2. What are your hours?
   *Be sure to ask about weekends, holidays and high-volume time periods
3. Do you have a non-disclosure agreement (NDA)?
   *And is it enforced?
   
4. Where are your warehouses located?
   *Do high-volume areas and locations match up?
   
5. Can we have customer recommendations/referrals?
6. How many warehouses do you operate?
7. What are the costs listed in your quotes?
   *Typical costs can include: account setup fees; monthly minimums; picking/packing fees; receiving costs; shipping costs; transportation costs; warehousing fees
8. Does your standalone platform integrate via FTP file transfers or is it integrated through an EDI?
9. What is the ease of use for your standalone platform?
10. Do you specialize in any top industries?
    *If so, what are they? Do you have experience in my industry?
    
11. What is your procedure for next-day orders?
12. Can you do custom packing slips?
13. Can you do custom reporting, 24×7 data access?
14. What is your compensation for unexpected delays?
15. Can you accommodate sharp upticks in volume?
    *If so, how? What is your plan? How do you manage unexpected spikes?

Cadre has a solid network of 3PL providers. Do you need a recommendation, contact us? 

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Frequently Asked Questions

What is a 3PL provider and how does it work?

A 3PL (third party logistics distribution) provider is an external company that manages your warehousing, fulfillment, and shipping operations. They handle inventory storage, order picking and packing, and delivery coordination on your behalf. This allows businesses to outsource their entire supply chain operations while focusing on core business activities like product development and marketing.

How much does it typically cost to work with a 3PL provider?

3PL pricing varies based on services needed, order volume, and product characteristics. Most providers charge for account setup, monthly minimums, pick/pack fees, receiving costs, storage, and shipping. Expect monthly minimums ranging from $500-$2,000, with per-order fees typically between $3-$8. Volume discounts usually apply as your business scales up.

When should a business consider switching to a 3PL provider?

Consider a 3PL when you’re spending too much time on fulfillment instead of growing your business, experiencing shipping delays, struggling with inventory management, or facing seasonal volume spikes. Companies typically make the switch when processing 100+ orders monthly or when warehouse costs exceed 3PL pricing. Growing businesses also switch to access better shipping rates and technology.

What are the main risks of choosing the wrong 3PL provider?

Choosing the wrong 3PL can damage customer relationships through delayed shipments, incorrect orders, and poor communication. Other risks include hidden fees that inflate costs, inadequate technology integration causing inventory discrepancies, and limited scalability during peak seasons. Poor customer service and lack of transparency can also harm your brand reputation and customer loyalty.

How long does it take to onboard with a new 3PL provider?

3PL onboarding typically takes 2-6 weeks depending on inventory complexity and integration requirements. The process includes contract negotiation, system integration setup, inventory transfer, staff training, and testing procedures. Simple businesses with basic products may onboard faster, while complex operations requiring custom workflows or specialized handling need more time for proper implementation.