Labor Shortage and Rising Labor Costs Creating Headwinds for 3PLs Despite 85% of 3PLs Reporting Growth

EL SEGUNDO, CA – October 19, 20213PL Central, the leader in cloud-based Warehouse Management Systems (WMS) built to meet the unique needs of third-party logistics (3PL) warehouses, today released the second annual and industry’s only benchmark report focused exclusively on the 3PL warehouse industry. The Third-Party Logistics Warehouse Benchmark Report aggregates data from 200+ 3PL warehouses and provides insight on more than 30 industry-specific topics. This report builds on previous data and provides year-over-year changes and trends to help warehouses understand market growth opportunities and challenges facing the industry.

Key take-aways from the report include:
  • 85% of 3PL warehouses experienced order volume growth in 2021, with 23% growing order volumes by more than 50%.
  • 48% reported struggling to find and retain qualified workers, while also citing significantly increasing labor costs.
  • 45% of respondents operate in the mid-market with two to five warehouses. These mid-market warehouses were four times more likely to experience medium to high level order volume growth versus other respondents.
  • 84% of 3PLs have implemented a WMS as the central hub of technology for their business, with the average 3PL having three or more systems integrated to their WMS (e.g., shopping carts, marketplaces, order management systems, etc.).
  • 53% of 3PLs fulfill orders less than 90 minutes after receipt, with speed of order fulfillment linked closely with annual order volume growth.

The report details trends and key metrics related to growth opportunities, profitability, labor shortages, warehouse space limitations, technology integrations, success measurements, and more. This year marked a unique time for 3PL warehouses. 3PLs overwhelmingly grew order volumes, profits, and customers. However, some headwinds exist with most 3PLs operating at or above warehouse capacity, some of the lowest warehouse vacancy rates in history, significant supply chain backlogs, and a workforce shortage that left many with higher labor costs and fewer people to address the higher volumes. Despite these headwinds, 3PLs expressed significant optimism for 2022.

“Looking at year-over-year data, the labor shortage and warehouse capacity limitations have become more acute issues for 3PL warehouses,” said Rachel Trindade, chief marketing officer at 3PL Central. “Respondents show how they have addressed these concerns with automation, technology, and system integrations. With the Third-Party Logistics Warehouse Benchmark Report, 3PL Central hopes to share insight with 3PLs to give them access to the industry benchmarks so that they can plan for and implement best practices to support order and profitability growth in 2022.”

The report also explores the current 3PL warehouse landscape, key challenges and opportunities, and planned technology implementations for the future. The report has compiled this data in order to outline best practices to consider for the coming year.

Click here to view and download the complete 2021 3PL Central Third-Party Logistics Warehouse Benchmark Report.

About 3PL Central

3PL Central is the leader in cloud-based warehouse management system (WMS) solutions built to meet the unique needs of the 3PL warehousing community. Serving as the backbone of our customers’ operations, our platform quickly transforms paper-based, error-prone businesses into service leaders that can focus on customer satisfaction, operate more efficiently, and grow faster. Offering a comprehensive warehouse management platform, we make it easy for 3PLs to manage inventory, automate routine tasks, and deliver complete visibility to their customers. As the proven industry leader for over a decade, 3PL Central accurately manages billions of dollars in inventory and processes more than 1 million orders a week from any of our customers’ systems. To learn more, please visit https://3plcentral.com/.

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