For most e-commerce brands, Q1 is an important time to reset and realign goals for the year ahead. In addition to evaluating holiday sales, auditing operational performance, calculating inventory, and reviewing all revenue and operational benchmarks from the prior year, organizations also assess their supply chain partners.
What’s Related
While it can be a time-intensive process, evaluating supply chain partners, such as a 3PL (third-party logistics) provider, is necessary to continue to grow the business. Knowing when it’s time and how to approach the decision thoughtfully is an important distinction.
How Do You Know It’s Time to Switch 3PLs?
There are many reasons brands explore new fulfillment partners, but a few common issues include the following:
Customer Complaints are Piling Up
Your customers (whether individuals or retailers) are a very clear barometer of your fulfillment performance. If there are repeated complaints about damaged goods, late deliveries, incorrect orders, or inconsistent experiences, it’s time to take a hard look at your 3PL’s ability to correct the root cause. Occasional issues happen in any operation, but persistent errors can signal a deeper problem. If your provider can’t establish a clear path to improvement, it may be time to look for an alternative partner.
Sales Channels Are Growing
When your sales channels grow, you need the support to meet each new channel with expertise. In many cases, brands start with the Direct-to-Consumer (DTC) model, which is relatively easy to handle and execute but it gets exponentially harder once you enter the retail market. Success in the retail sector requires expertise, experience, and robust quality controls to execute at scale. The stakes are far higher in retail so brands can’t risk things with an inexperienced operator.
Your Technology has Outgrown Your 3PL
To compete successfully in e-commerce, it’s imperative to have a system that can keep pace with the demands of today’s complex supply chain. Look for a more forward-thinking partner that provides advanced technologies such as warehouse and inventory tracking systems, AI-backed shipping optimization, and operational data analysis, to name a few. Modern fulfillment requires real-time inventory tracking and reporting, and the ability to integrate quickly with new platforms and channels. If your 3PL isn’t maturing as quickly as your brand, don’t let it slow you down.
Shipping Costs are Climbing with No Plan in Sight
Annual carrier rate increases are a reality of the industry. A strong 3PL shouldn’t just pass those increases along; they should help you navigate them. If your fulfillment partner isn’t proactively optimizing shipping methods or proposing alternatives to protect your margins, look elsewhere. Your 3PL should be incentivized to help you save money, not collect more fees.
Increased SKU Count or Sales Complexity
For most companies today, fulfilling orders across multiple sales channels is a complex process. As brands grow, their needs grow exponentially. If inventory is needed in additional or different geographic locations, look for a provider with strategically located distribution centers to reduce transit times and potentially lower shipping costs. Partner with a 3PL with robust order management technology and product customization capabilities to meet customers’ needs, whether they are retailers, individuals, influencers, or loyal subscribers.
A Practical Checklist to Review Before Changing 3PL Partners
Switching 3PLs requires planning, coordination, and a willingness to absorb short-term disruption for long-term gains. The right partner relationship is built over time, not rushed through an RFP process. Before making a move, step back and evaluate these core areas:
1. Review your contract and revisit your goals.
Many brands sign with a 3PL and assume they’ll switch once they grow to a certain size. In practice, switching providers mid-growth can introduce risk and distraction. If your current 3PL is fundamentally reliable, start by re-visiting your agreement and goals together to gauge progress, which will help determine if the partnership continues.
Some important questions to ask:
What are your sales and promotion plans for the year ahead?
What does your three to five-year roadmap look like?
Which channels are critical today, and which ones are you testing?
A strong 3PL will welcome these discussions and adjust the partnership to achieve long-term success together.
2. Determine inventory and location strategy
Before considering a move, complete a full physical inventory count. Accurate data is essential for financial reporting and for a smooth transition. Location strategy is important because proximity to customers can reduce transit times, lower shipping costs, and improve customer satisfaction. Identify the regions that matter most for inbound and outbound shipping, and evaluate whether your current or future 3PL has the right facilities to deliver goods to their destination quickly and on time. If shipping internationally, this is even more important as tariff uncertainty and cross-border complexity require a 3PL that can help offer in-country fulfillment.
3. Evaluate all sales channels and integrations thoroughly
Omnichannel fulfillment is no longer optional; it’s essential to meet customers where they shop, across DTC, marketplaces, retail, social commerce, and subscriptions. Testing new channels can be resource-intensive. A 3PL with built-in integrations and proven experience across channels can dramatically streamline this process.
The Bottom Line
If a provider change is on the table, take stock and understand the support needed to make the switch. Without proper support, organizations run the risk of selecting a 3PL that is unable to meet their growing needs and goals. To set up the business for future growth, it’s imperative to have a partner who can evolve alongside you.
Brian Tu is Chief Revenue Officer for DCL Logistics
