Finding an order fulfillment services provider begins with a Request for Proposal, commonly referred to in the logistics sector as a fulfillment RFP. The service level and capabilities of the third-party logistics (3PL) providers that respond to an RFP will correlate directly with the quality of the RFP itself. If you cast too wide a net, you risk introducing extra noise into the process, which wastes time as you weed out the poor-fit providers and identify the good ones.
Instead, narrow the focus of your RFP by identifying providers that operate in similar verticals, channels, and order volumes. Virtually any fulfillment 3PL can handle small order volumes, but an ability to handle the challenges of large-volume order fulfillment indicates a 3PL can manage your orders properly. Also, make sure to further narrow your list by checking references, meeting representatives in person, and touring a fulfillment center. Check out our unique take on questions to help vet eFulfillment services partners.
Creating a Great Fulfillment RFP
Once you’ve checked all those boxes and narrowed down your shortlist, it’s time to develop your fulfillment RFP. To attract your ideal 3PL partner, make sure your RFP includes the following:
Say Who You Are and What You Want
Provide information about your company, including where you’ve been and where you want to go as a business. Be clear about how you think excellence in order fulfillment will help get you there. Whatever your goals are, state them clearly in the RFP, so prospective partners get a clear sense of how to help you. For example:
- Are you looking for a purely transactional relationship with the lowest cost? Say that, and you’ll get responses from price-focused 3PLs.
- Do you want a long-term relationship with a strategic partner that can help you grow? Put that in your RFP, and quality fulfillment houses will take notice.
Be sure to talk about the scope of work and what you expect. If you expect a 3PL that can provide advanced technology solutions, state that clearly. If you require direct experience with your product type, that’s important to emphasize. The more information you provide upfront, the better responses you will get to your fulfillment RFP.
Send As Much Data As You Can Gather
Include relevant logistics data you’ve collected about your fulfillment activities. For example, are your inbound shipments usually LTL or container? How often do they arrive? How many pallets per shipment? What about outbound orders? What were your sales numbers for the past few years? How many orders did you ship? The level of granularity in the data you provide will determine the accuracy of the RFP responses and pricing you receive.
Think of it as bringing your car to the mechanic. If you say, “there’s something wrong with it,” the mechanic has to figure out the problem. However, telling the mechanic that the car pulls to the left or the transmission slips can help them diagnose the problem faster and present a solution. So it is with a logistics provider during the RFP process. Of course, in a worst-case scenario, you can put a data dump in the RFP, and the 3PL will know how to parse the data, but being specific is better.
Include Useful Service Level Standards
Decide which key performance indicators (KPIs) matter for your fulfillment operation. In other words, pick KPIs that will move the needle for your company instead of measuring things just for the sake of measurement. Otherwise, you end up performing accounting gymnastics over percentages that don’t actually matter to your business. Some good examples of order fulfillment metrics that matter for most fulfillment operations include:
- Inventory accuracy
- On-time receiving
- On-time shipping
- Fill rates
- Employee retention rates
- Order cycle time
- Order accuracy/perfect order rate
- Dock-to-stock time
For your fulfillment RFP, you’ll want to choose no more than 5 or 6 KPIs you plan to measure to benchmark performance. Additionally, decide on failure numbers for each KPI and encourage respondents to provide details about how they will measure and meet your KPIs.
Give a Deadline
An RFP process can take up to three months, especially when the RFP doesn’t provide enough information for fulfillment providers to give informed responses. The size and complexity of the request will also influence the timeline. However, if the fulfillment RFP is solid and includes all of the necessary data, you should start getting responses within one to three weeks.
Order Fulfillment Services From Amware Fulfillment
If you’re seeking a long-term strategic fulfillment partner with the know-how and national fulfillment infrastructure to help you grow, consider making Amware Fulfillment part of your next fulfillment RFP process. To learn more about our order fulfillment services, reach out and let’s start a conversation.