BEST PRACTICES IN THE SEARCH & SELECTION OF A 3PL PARTNER

OPERATIONS SUMMIT 2013

Presenters:

Rick Hall – VP, Client Success, FIFTH GEAR

Matt Konkle – President, FIFTH GEAR

Making the Decision

Will outsourcing cost more than my in-house operations?

• Cost Per Order• Cost Per Contact• Inbound /

Outbound Freight• Seasonality• Operational

Performance• Fixed vs.

Variable Model• Scalability

Will I lose control of my business?

• Clear Scope of Services

• Key Performance Indicators

• Standard Operating Procedures

• Joint Business Planning

• Reporting & Analysis• Issue Resolution

Will my customers notice a difference?

• Brand Strategy• Target Customer• Product Offering• Sales Channels• Marketing Plan• Promotions• Personalization• Packaging• Customer Service• Competition

Focus your time on what will grow your business

Selecting a 3PL Partner

It’s about who you work with!

• Financially Stable• Expertise• Track Record• Reference

Clients• Ability to Scale• Talent and Labor

Pool• Right location(s)• Technology and

Support

Make the right comparison

• Technology Enablement• Freight Management• Data & Reporting• Business Analysis• Business Services• Product Personalization• Kitting / Assembly• Value-add Processing

• Leadership Team• Trained Workforce• Facilities (locations, infrastructure)• Standard Operating Procedures• Safety & Compliance• Flexibility• Client Service• Customer Care

• Receiving• Order Handling• Pick & Pack• Warehouse

Storage• Returns• Account

Management• Clerical Support• Technology Fees

One size does not fit all.

Making the Transition

Communication is critical

• Executive Sponsor(s)

• Project Management

• Account Management

• Cross-Functional Dependencies

• Business Planning

• Set Expectations• Customer Data• Open Order

Backlog• Hours of

Operation• Returns &

Exchanges• Issue Resolution• Appeasements

• Total SKUs• Product Attributes• Order Volumes• Order Attributes• Inventory Turnover• Density / Velocity• Service Level

Agreements• Seasonality

Know the Facts and Benchmark

• Order Backlog• Total SKUs• Units Shipped• Units Received• Total Customers• Total Vendors• Open POs• Order Demand• Order Attributes

• Average order value

• Lines per order• Units per order• Shipments per

order• Backorder rate• Returns rate• Declines / Holds

MinimizeThe Timeline

• Data Conversion• Integrations• System Setup & Testing• Payment Processing• Vendor Management• Customer Management• Contact Center Training• Warehouse Training• Inventory Transfer• Inbound receipts• Initial Receiving• Order Backlog• Returns

MakeADJUSTMENTS

Thank You!

Matt Konkle – President mkonkle@infifthgear.com

Rick Hall – VP, Client Success rhall@infifthgear.com