Competition for 3PLs is only getting tighter. Online shopping growth has spurred a high demand for third-party fulfillment. But even with a sought-after service, 3PLs must continue to work hard to earn customer loyalty.
That’s mostly because competition in the industry doesn’t begin at the warehouse. It starts with retailers competing for a slice of the growing online shopping pie. E-commerce sales are expected to hit $6.3 trillion by 2023, while Amazon sales are estimated to account for half of all online transactions this year. Because so many retailers are doubling down on an e-commerce experience, they’re looking for ways to lower their costs to remain competitive in a growing market.
That’s where the value of 3PL customer loyalty comes in. It’s easy for retailers to be enticed by 3PL competitors offering lower prices, promises of faster shipping, and shiny new features and technologies. But when you focus on loyalty-building services first, you stand a better chance of retaining business and not losing them to a lower-priced competitor.
Here’s what 3PLs can do to increase customer loyalty without undercutting your competition.
The word ‘pivot’ has been a common theme throughout the pandemic. Retailers that were able to shift quickly to new needs and conditions enjoyed the most success. Now more than ever, retailers are discovering that scalability is essential to business survival.
3PLs that can support a scalable business are most likely to earn ongoing customer loyalty. This may include the ability to take on more inventory at a moment’s notice, add additional services, or even reduce capacity. Customers take comfort in knowing they’re not locked into rigid fulfillment services that may not suit their quickly changing business needs.
Third-party logistics companies can demonstrate scalability by creating custom, understandable, and flexible service terms for each client. Having onboarding processes and other systems in place take the guesswork out of scalability for the warehouse and the customer alike. One of the challenges with offering customized terms is that it can add some billing complexity. But with the help of a modern warehouse management system like Zenventory, much of the calculation for client billing is handled automatically even if your terms are different for each client.
Offer Comprehensive Services
Banks, telecoms, and companies like Amazon have known this for a long time: the more services and value you can offer a customer, the “stickier” they become. It’s hard to break away from a company you use for multiple reasons. Once you do, you have to find a new company or companies to fill those gaps.
3PLs can create sticky customers simply by becoming their go-to for all of their fulfillment needs. This means giving them more than a place to store their stuff. Comprehensive services might include:
- Kitting and assemblies
- Inventory management and reordering
- Vendor management & purchasing tools
- Fulfillment automation
- An easy-to-use portal to view the status of their inventory and fulfillment
This list is not exhaustive, but it does show how you can generate more value per customer and increase their loyalty.
Create Branded Experiences
One of the ways retailers are overcoming their competition selling lookalike products is to let their brand do the talking. Just like you, they’re aiming to build customer loyalty through the experiences they create.
To separate themselves from competitors, 3PLs can help their clients create branded experiences. For example, a warehouse management system that offers custom branded packing slips per client allows your system to become an extension of their business. Your warehouse is part of their brand, which helps your clients keep more control over the total experience.
When fulfillment feels more like a part of their company rather than an outsourced service, retailers are more inclined to retain you as their provider.
Provide More Control Over Inventory and Processes
When retailers partner with a 3PL company, they’re essentially giving up a portion of control over their business. Once orders are placed, fulfillment is in the hands of the warehouse staff. They’re not able to inspect items before shipping, ensure items are packed safely for arrival, or choose when items are shipped out, for example.
However, retailers naturally want to be the face of their own business. They have a reputation to protect. Most will remain engaged at some level with this critical aspect of their operations.
3PLs who can deliver a greater sense of control over fulfillment can use this to build customer loyalty. The easiest way to do this is via access to your warehouse management system.
Your warehouse management system should be a shared tool between your staff and your customers. With Zenventory, your clients can log in to their portal to view real-time inventory levels. They can manage items, identify allocation issues, and even create manual orders that skip the normal ordering process.
Customers want the same level of flexibility as if they were fulfilling orders in-house. This allows them to gain more confidence in their outsourced services. They have the transparency they need to serve their customers quickly when they need to check inventory levels or answer questions.
Bottom line: empower retailers to maintain good visibility and control over the experience. They’ll feel 100% confident in the fulfillment strategy, and you’ll become an indispensable partner.
How Zenventory Builds Customer Loyalty for 3PLs
Zenventory’s warehouse management system is purpose-built to generate customer loyalty, both to our company and to your warehouse. We’ve designed a full suite of ready-made features that enables collaboration, transparency, and automation so that users can provide the best experiences to their customers.
Our integrations with popular online marketplaces and e-commerce platforms streamline the ordering and fulfillment process. Orders travel straight from the customer’s website to the warehouse management system. This creates a strong foundation for operational efficiency. Customers also gain more control over their fulfillment processes with real-time views into inventory, low stock alerts, stock allocation, and so much more.
It’s easy to lose customers to cheaper competitors when price is the only factor that is easy to compare. Differentiating your service in tangible ways that build trust will be your best defense against churn. With the right tools in place, your customers will have easy ways to judge your service on value, rather than just price.
Learn more about how Zenventory builds customer loyalty when you schedule a demo.