How to Choose a 3PL

Most bad 3PL matches trace back to this step being skipped. A 3PL that is excellent for a 20-SKU supplement brand shipping 8,000 orders a month is usually the wrong 3PL for a 1,200-SKU apparel brand shipping 800. Before you contact anyone, write down the numbers a 3PL will price against:

• Monthly order volume, split by DTC, wholesale/B2B, and marketplace, with your peak month and your slowest month. Peak-to-trough ratio matters more than the average.
• Units per order (average and distribution). 1.2 units per order and 3.5 units per order are priced very differently.
• SKU count and how many are active in a typical month. A 3PL charges storage on every SKU you send, not just the ones that sell.
• Product profile: dimensions, weight, fragility, hazmat, temperature control, lot or expiry tracking, serial numbers.
• Where your customers are. Pull a ZIP-level breakdown from your store. If 60% of orders ship to the East Coast, a single West Coast warehouse costs you a zone or two on every parcel.
• Systems: cart (Shopify, BigCommerce, WooCommerce), marketplaces, ERP, and whether you need EDI for retail (see the EDI guide).
• Special handling: kitting, subscription boxes, inserts, gift wrap, returns processing, FBA prep, retail routing guides.
• Certifications you need: FDA registration, GMP, organic, cold chain, hazmat. The certifications guide explains which ones matter for which products.

Time 2 to 3 days if your data is cleanOutput a one-page operational profile you will paste into every RFP

Filter, do not browse. The 3PL Hub directory holds 5,000+ 3PLs; 200+ are fully vetted and authenticated. Use the filters that map to your profile from Step 1: location, vertical, sales channel, WMS and integrations, certifications, and order-volume fit. Aim for 5 to 8 names. Fewer than 5 and one dropout leaves you without leverage. More than 8 and the RFP stage becomes a part-time job.

Three filters that get skipped and should not be:

• Volume fit. Ask where you would sit in their client list. If you would be their largest client, you are their risk. If you would be their smallest, you are their afterthought. The middle third is where service is best.
• Vertical experience. A 3PL that already ships products like yours has the packaging, the carrier contracts and the QC process in place. Start with the vertical pages: Shopify, DTC, apparel, health and beauty, food and beverage, big and bulky, FBA prep, returns.
• Warehouse location vs customer map. Match the ZIP breakdown from Step 1 against candidate warehouses. Use 3PL Near Me or the East Coast and West Coast pages if you are choosing a region.

If you would rather have the shortlist built for you, Get Matched is free and returns 3 to 5 pre-qualified 3PLs against your requirements. 3PL Hub takes no commission from 3PLs.

Time 1 to 2 daysOutput 5 to 8 named 3PLs with a contact at each

A structured RFP is the single biggest lever in the whole process. Send the same document, with the same data, to every 3PL on the shortlist, and you get quotes you can actually compare. Send an email that says "can you quote us" and you get eight different rate cards priced on eight different assumptions.

The RFP should contain:

• Your operational profile from Step 1, including a 12-month order history by month and a sample of 200 to 500 real orders with SKUs, units, weights and destination ZIPs.
• A bid sheet with fixed line items so every 3PL fills in the same boxes: receiving (per pallet, per carton, per unit), storage (per pallet, per bin, per cubic foot, per month), pick and pack (first unit, additional unit), packaging materials, order minimums, account management fees, technology or integration fees, returns processing, kitting, and accessorials.
• Carrier rates or the discount off published rates, and who owns the carrier account.
• Service level questions (below).
• A deadline, usually 10 business days, and a single point of contact for questions.

The free 3PL Rate Checker is a standardized RFQ form built for exactly this purpose. The step-by-step process, including the blind-bid rules, courier normalization and a free Excel bid sheet template, is in the how to run a 3PL RFP guide. A managed RFP, where 3PL Hub builds the bid sheet, pre-qualifies the field and runs the process, is available as a consulting engagement.

Time 2 days to build, 10 business days for responsesOutput 5 to 8 completed bid sheets on identical assumptions

Rate cards lie by omission. A 3PL with a $1.25 pick fee and a $0.75 additional-unit fee can cost more than one at $1.75 and $0.35 if your average order carries three units. The only fair comparison is to run every bid sheet against the same month of real orders and total the invoice.

Build a spreadsheet with one column per 3PL and one row per fee line. Multiply each rate by your actual monthly quantity: orders, units, pallets stored, cartons received, returns, kits. Add the fixed fees. Add estimated shipping using each 3PL's carrier rates against your ZIP distribution. The bottom line is your modeled monthly cost, and the ranking often changes completely from the rate-card ranking.

Benchmarks from 98 real RFP quotes on 3PL Hub, so you know when a number is out of line: median order fee $1.50, median additional-unit pick $0.35, median pallet storage $20 per month. Full breakdown by volume tier and region is in the 3PL pricing and rates guide.

Things that should be in the model and usually are not:

• Packaging materials. Some 3PLs include a standard box and mailer; others charge $0.40 to $1.50 per order.
• Storage seasonality. Your pallet count in November is not your pallet count in February.
• Minimums. If a 3PL has a $2,500 monthly minimum and your modeled cost is $2,100, you pay $2,500.
• Technology fees, integration setup, and per-user WMS access.
• Accessorials: relabeling, non-conforming receiving, special projects, rush orders, address corrections.

Time 2 to 3 daysOutput a modeled monthly cost per 3PL and two or three finalists

Every 3PL has two happy references ready. Ask for two of your own choosing instead: one client with a similar profile to yours, and one that has been with them for more than two years. Then call, do not email. Fifteen minutes each.

Pair the calls with a site visit if the warehouse is within reach, or a live video walkthrough if not. Look at the receiving dock, the returns area and the packing stations, not the conference room. A clean, organized returns area is the best single indicator of an organized operation.

Time 1 week including schedulingOutput a preferred 3PL and a backup

Because you ran a structured RFP, you have comparable quotes and you know where your preferred 3PL is expensive relative to the field. That is the negotiation. Focus on the lines that move your modeled month the most, which for most brands are the additional-unit pick, storage and packaging.

The terms that matter more than the rates:

• Minimums. Ask for a 90-day ramp with no minimum, then a minimum set at 70 to 80% of your modeled month.
• Rate lock. 12 months minimum. Ask for a cap on annual increases, and ask that carrier general rate increases pass through at cost, not with a margin.
• Exit terms. 30 to 60 days notice, no exit fee, inventory transfer support at the published outbound rates, and full data export (inventory, orders, receiving history) in a usable format. This is the clause that saves you when you need to switch, and it is the easiest one to get before you sign.
• SLAs with teeth. Order accuracy, on-time ship, receiving time and inventory accuracy, each with a number and a credit if it is missed two months running.
• Insurance and liability. Confirm coverage per occurrence and what counts as a valid claim.

Time 1 to 2 weeksOutput a signed agreement with rates, SLAs and exit terms attached

Onboarding takes 4 to 10 weeks: contract, integration (cart to WMS, plus ERP or EDI if you have them), inventory transfer, a parallel run, then cutover. Multi-warehouse setups take 8 to 12 weeks to stabilize.

The parallel run is the step brands skip and regret. For one to two weeks, route 10 to 20% of orders through the new 3PL while the old one handles the rest. It surfaces integration mapping errors, packaging problems, wrong carrier service selection and cutoff misses while 80% of customers are still unaffected. Send a batch of test orders across every product type, every shipping method and at least one return before you send real ones.

Inventory transfer is the other risk. Count everything before it leaves, get a signed receiving report at the new 3PL, and reconcile the two before you release the balance. Discrepancies found in week one are the old 3PL's problem; discrepancies found in month three are yours.

Time 4 to 10 weeksOutput 100% of orders on the new 3PL with reconciled inventory

The first 90 days set the pattern for the relationship. Track four numbers weekly and share them with your account manager every week, so the review is routine rather than a complaint:

• Order accuracy (correct items, correct quantity): target 99.5% or better.
• On-time ship (shipped by the promised cutoff): target 97% or better.
• Inventory accuracy (system count vs cycle count): target 99% or better.
• Receiving time (dock to available): target 48 hours or better, 24 for high-velocity SKUs.

Add invoice audit to the list. Check the first three invoices line by line against the contract rates and your own order counts. Billing errors are common in month one and almost always in the 3PL's favor. Most are honest setup mistakes, and the ones that are not get caught here.

Time 1 hour a weekOutput a scorecard you can use at renewal, and an early warning if the fit is wrong