Monitoring KPIs is an important part of your operations and this is especially important for tracking and managing 3PL performance.
Can You Manage Both B2B & B2C Through One 3PL?
Managing inventory and order fulfillment separately for a B2B and B2C business can over-complicate operations. Combining both into one operation with the same 3PL has great benefits.
It’s not uncommon for companies that have both a B2B and B2C business, to manage their inventory and order fulfillment separately. This, however, can over-complicate a company’s operations. Combining B2B and B2C warehousing and fulfillment into one operation with the same 3PL is something companies should consider as there are great benefits to structuring your business this way.
So, why should a company consider a more unified approach with warehousing and fulfillment for B2B and B2C?
Let’s first take a look at how unifying B2B and B2C can benefit a business with its inventory management.
There are many differences between inventory management and fulfillment for B2B vs. B2C. When it comes to B2C, this is when orders are sent directly to a customer rather than the business or retailer. Today, you may often hear this type of sales channel referred to as direct-to-consumer or D2C but it’s essentially the same as B2C. There are fewer rules involved with B2C fulfillment than there typically would be for B2B. Typically B2B requires many integrations with other systems for retailers they do business through whereas B2C may only need to integrate with their eCommerce system.
It’s important to acknowledge that when it comes to B2C warehousing and fulfillment, both speed and accuracy are essential. Today’s consumers are expecting quick delivery for orders they place online. Any brand selling goods online for direct-to-consumer often strives for fast delivery as this can be a competitive advantage. B2C is also going to be less predictable when it comes to order fulfillment since the buying behavior is dependent solely on the end consumer whereas for B2B, fulfillment is scheduled and coordinated with the business and retailers as the distribution would be scheduled and coordinated ahead of time making it more predictable to plan for in advance.
Keeping B2B and B2C operating under different inventory management systems makes it challenging for a business to get a full, real-time view into all of their inventory across all sales channels. When it comes to B2B inventory, often it’s standard to manage inventory as part of the warehouse’s larger warehouse management system, known as a WMS. B2B inventory is typically tracked by pallet or case but when it comes to B2C, inventory typically is tracked by units of a single SKU.
Another benefit of combining B2B and B2C under the same 3PL or warehouse is to reduce warehousing costs for storing inventory. When storing both the inventory for B2B and B2C together, it will reduce the amount of inventory required to have on hand across your network for distribution. This will not only reduce costs for storing inventory but will also minimize the number of unsold items. Otherwise, you may end up storing more inventory than you would necessarily need within multiple fulfillment locations to ensure you wouldn’t run out of stock.
It’s important to note that not all 3PL providers are suited for B2B and B2C. Some are more specialized in B2B distribution whereas others may be better skilled for B2C. If your company has both B2B and B2C sales channels, it’s important that you ask your 3PL plenty of questions regarding both types of businesses to verify if they are flexible and skilled enough to handle both for you.
When looking for a suitable 3PL to handle both your B2B and B2C business, you should consider that the infrastructure is an important factor for fulfillment. Bulk distribution for B2B and eCommerce fulfillment require different setups within the warehouse. Make sure you go over each setup thoroughly when choosing a 3PL to determine they understand what is needed for each type of sales channel. Keep in mind that B2C fulfillment usually requires special shipping features to satisfy the end customer that aren’t typically part of the B2B fulfillment process. It’s essential that you verify with your 3PL that they can support the special requirements you’ll likely have for fulfilling direct-to-consumer orders. Lastly, don’t forget to address how you expect your 3PL to handle managing returns as well.
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