Ecommerce Fulfillment — Can 3PL’s Compete with Amazon?
Amazon was founded in 1994 as a book seller, today they are a corporate powerhouse that has diversified into a variety of markets including: hardware, software, web services, and entertainment. In recent years, Amazon has continued to grow as a logistics provider by providing ecommerce fulfillment services for SMB’s. Amazon is now offering transportation services including final mile delivery to consumers, but are they a threat to traditional 3PL providers?
Amazon’s entry into ecommerce fulfillment has been game-changing. Amazon provide SMB’s with a first class platform that allows businesses to manage their supply chain’s easily and efficiently online.
But is Amazon’s platform a good fit for large retailers? Good 3PL providers customize their logistics services for the retailer. Not the other way around. As good as Amazon’s services are, traditional 3PL’s can be flexible to a retailer’s needs and provide customization where needed.
Many large retailers require 3PL’s to bend their business rules in order to do business with them. Those 3PL’s who are not willing to do this, don’t get their business.
Traditional 3PL’s operate with a more complex pricing model that favors retailers who sell in large quantities. Retailers can leverage their supply chains by using 3PL providers for multiple services such as: drayage, deconsolidation, and transload. By doing so, retailers can receive discounted rates for all their logistics services.
3PL’s such as NRS are experienced when it comes to dealing with crisis situations and have helped customers at an hour’s notice when they are most desperate. This level of service is invaluable and not available from low cost or non-traditional 3PL providers.
Amazon’s technical competency is unrivaled in the 3PL industry. Traditional 3PL providers will have to work hard to try and keep up with Amazon, however it is unlikely any will challenge Amazon’s dominance as an innovator in the 3PL industry. Amazon presence alone will ensure that traditional 3PL’s continue to push the bar in an effort to keep up – this can only be considered a positive for the industry.
As in all the industries that Amazon operates in, their presence continues to push innovation and make systems smarter, this can only be a good thing for logistics as a whole.
The Ultimate 3PL
National Retail Systems, Inc. (NRS) includes Keystone Freight Corp. & National Retail Transportation, Inc. (NRT). NRS is an asset based 3PL that has been providing logistics services for the World’s leading retail companies for 60+ years. Our hub locations include: New York & New Jersey; Los Angeles, CA; Inland Empire, CA; Savannah, GA; Columbus, OH; Greensboro, NC; and Baltimore, MD.