For third-party logistics (3PL) providers, managing multiple clients, complex fulfillment operations, and ever-changing customer demands requires more than just a standard warehouse management system (WMS)—it requires a 3PL warehouse management system. Designed for its flexibility, scalability, and efficiency, the right third party logistics software empowers logistics providers to handle multi-client inventory, automate billing, and optimize order fulfillment, all while seamlessly integrating with transportation and e-commerce platforms.
But not all 3PL software is created equal. With the right solution, 3PLs can streamline operations, reduce costs, and improve customer satisfaction. The wrong choice, however, can lead to inefficiencies, compliance challenges, and missed opportunities for growth.
In the article below, we break down what 3PL software is, what it does, the key benefits, must-have features, and common challenges to avoid—so you can make an informed decision and choose a system that supports your business’s long-term success.
We’ll cover:
- What is 3PL software?
- What does 3PL software do?
- The benefits of third-party logistics software
- Examples of third-party logistics software
- Features to look for in 3PL software
- Challenges to avoid when looking for 3PL software
What is 3PL Software?
Third party logistics software is used to manage warehousing and fulfillment. Generally speaking, 3PL software can refer to various logistics tools, including a warehouse management system (WMS), transportation management system (TMS), order management system (OMS), and a customer relationship management (CRM) system. These solutions empower 3PLs to manage end-to-end logistics, including inventory management, freight brokerage, carrier management, and reverse logistics.
What Does 3PL Software Do?
Built to bolster productivity, third party logistics software empowers 3PLs to keep up with the fast-paced world of third party logistics. In particular, a specialized 3PL WMS can include multi-client management, enhanced billing capabilities, integration with multiple systems and MHE, real time inventory tracking, and robust reporting.
A major differentiator of a 3PL-specific WMS is its ability to support multiple clients with completely separate inventories, order flows, billing structures, and reporting requirements—all within the same platform. As a result, 3PLs are able to service clients of different sizes and requirements without the need to invest in multiple third party logistics software solutions.
The Benefits of Third-Party Logistics Software
There are countless benefits associated with third-party logistics software. For those operations working with a 3PL-specific WMS, these benefits include:
3PL Software Benefit #1: Increased Warehouse Productivity
With features like task interleaving, real-time inventory visibility, and system-directed putaway/picking and the automation of order processing, inventory tracking, and fulfillment, warehouse employees are able to work more efficiently throughout the day. By eliminating manual processes and optimizing storage and retrieval paths, warehouses experience a significant boost in productivity.
3PL Software Benefit #2: Enhanced Labor Utilization
3PL WMSs with built-in labor management tools help supervisors monitor performance, track hours, and identify areas for improvement. Features like dynamic work allocation empower operations to ensure employees are assigned tasks based on real-time demand. By integrating labor forecasting, 3PLs can adjust workforce deployment based on peak periods, reducing labor costs while maintaining service levels.
3PL Software Benefit #3: Reduction in Warehouse Costs
A 3PL WMS helps reduce operational expenses by optimizing space utilization, minimizing the required inventory footprint. Automated billing ensures accurate compensation for all services, while automated order picking reduces costly shipping mistakes and returns. Additionally, improved inventory control lowers holding costs and prevents both overstocking and stockouts.
3PL Software Benefit #4: Inventory Accuracy
Real-time inventory tracking, cycle counting, RFID, barcode scanning, and system-directed inventory movement prevent errors, empowering 3PLs to maintain accurate records and reduce write-offs due to lost or misplaced inventory. High inventory accuracy leads to better forecasting and fewer disruptions in order fulfillment.
3PL Software Benefit #5: Improved Customer Service
Customer service is improved through real-time visibility into inventory, order status, and shipment tracking. Integrated customer portals allow clients to independently access their inventory data, place orders, and track shipments. Improved order fulfillment leads to fewer errors, reduced delays, and a better overall experience.
Examples of Third-Party Logistics Software
3PLs can benefit from a wide range of third-party logistics software. These can include a 3PL warehouse management system, like Made4net’s Synapse 3PLExpert. Others include:
- Transportation Management Systems (TMS)
- Order Management Systems (OMS)
- Customer Relationship Management (CRM)
- Reverse Logistics Software
- Billing & Invoicing Software for 3PLs
- Yard Management System (YMS)
- Warehouse Robotics & Automation Software
- Demand Forecasting & Inventory Optimization Software
- EDI (Electronic Data Interchange) & API Integration Platforms
- Supply Chain Visibility Platform
Features to Look For in 3PL Software
Made4net’s Synapse 3PLExpert is packed with a bevy of features designed for efficiency and growth.
3PL Software Feature #1: Inventory Management
Provides up-to-date inventory status with configuration options tailored to meet the needs of multiple customers.
3PL Software Feature #2: Billing Granularity
Captures and automatically bills for every customer activity, including value-added services and other unique requirements.
3PL Software Feature #3: Value-Added Services
Offers a suite of services such as kitting and assembly, labeling, repackaging, and work order processing to enhance customer service offerings.
3PL Software Feature #4: Labor Management
Improves labor forecasting and increases efficiency through data capture activities, supported by sophisticated reporting and data mining.
3PL Software Feature #5: Reporting
Delivers deep, flexible reporting capabilities by integrating data mining tools, analytics, and a data warehouse to prioritize key performance indicators.
3PL Software Feature #6: Returns Processing
Simplifies the returns process by addressing customer replacements and managing inventory as required.
3PL Software Feature #7: System Integration
Seamlessly integrates with financials, shopping carts, order management, ERP, parcel manifesting, warehouse automation, and transportation management systems, sharing critical data through secure API integration.
3PL Software Feature #8: Customer Portal
Provides customers with autonomy over their orders via an easy-to-use web-based portal, allowing them to query their stock, inventory flow, throughput, receipts, and shipments.
Challenges to Avoid When Choosing 3PL Software
Choosing the right third party logistics software takes a deep understanding of business needs, growth goals, and technological readiness. While there may be a variety of challenges businesses face when selecting 3PL software, the three obstacles we see the most are:
- Scalability issues: Many businesses choose software that effectively addresses their current pain points but lacks the flexibility to scale as their operations grow. This often results in the need for another costly and disruptive selection and implementation process down the line—leading to lost time, money, and confidence from both clients and leadership.
- Lack of real-time visibility: Without dynamic, real-time updates, 3PLs operate on outdated information, increasing the risk of errors, shipment delays, and miscommunications. A modern 3PL solution should provide live data insights to ensure decisions are made with the most current information available.
- Complex integrations: Not all software solutions are designed to integrate seamlessly with customer systems, ERPs, or transportation platforms. A lack of smooth connectivity can create inefficiencies, bottlenecks, and potential breakdowns in service. Selecting a solution with strong integration capabilities is essential for maintaining operational fluidity and meeting customer expectations
3PL Software: Start Your Search Here
If you’re on the search for the right 3PL software, you’re in the right place. Made4net is proud to support over 100 3PL customers worldwide. In fact, 10 members of our customer community have been recognized as Top 100 3PL Providers, including two in the top 10. Check out these 3PL Software Reviews—From Real Life Operations Managers and schedule a demo to see how Synapse 3PLExpert can drive your operations forward.
