Selecting a 3PL (Third Party Logistics) partner is quite an undertaking. When preparing an RFP, it is important to explain your operation accurately in language and numbers that 3PLs can understand. Tell potential partners about your organization and exactly which services you are looking to hire. They will use this information to model labour & space requirements and, by extension, develop their pricing.
In an RFP, describe the following:
- Type of business – industry and sales channels you sell into
- Number and type of products
- Typical customer categories and locations
- Typical supplier categories and locations
- What you need done, such as:
1. Receiving
2. Storage and inventory control
3. Picking and packing
4. Shipping - Special requirements that need to be met such as pharmaceutical health and safety standards, cold chain requirements, kitting, gift wrapping or other special packaging, lot management, inventory rotation etc.
- Lay out the volume in meaningful terms. If your business experiences significant volume swings throughout the year, you should provide data points for both average and peak periods. The 3PL will require information to adequately gauge:
1. Labour necessary to fulfill an order – an average order will need to be described in terms of lines, item quantities, weights & volumes and daily order quantity.
2. Labour at reception – define inbound volumes in terms such as the number of purchase orders received and the typical volume of merchandise per purchase order.
3. Storage requirements – define typical inventory levels. Explain how many products you usually have on hand and how much stock you keep per item. - Growth projections throughout the anticipated duration of your partnership. How do you envision growing or changing, particularly in terms of volume, product offering and sales channels?
Interested in learning more? Download LIDD’s eBook Third Party Logistics (3PL) Selection, a full guide on how to select your ideal 3PL partner.