A 3PL (third-party logistics) is a company that stores your inventory, picks your orders and ships them to your customers for you. You remain the owner of the goods and of the customer relationship; what you outsource is the physical operation: receiving, storing, packing, dispatching and processing returns.
The acronym sits on a ladder that runs from 1PL to 4PL. If the full ladder interests you, we break it down in 3PL vs. 4PL; here we stay on the practical side.
What a 3PL does, day to day
The service is five chained operations. A complete provider does all five; some do only a few, and that's where reading the fine print pays.
| Operation | What happens | Why it matters |
|---|---|---|
| Receiving | Your goods arrive, are counted, checked and registered | What's miscounted on the way in is missold for its whole life |
| Storage | Each product gets a fixed, registered location | Without a registered location, orders run slow and wrong |
| Pick & pack | Each order's items are picked and packed | This is where visible errors are created — or avoided |
| Shipping | The label is generated and the parcel leaves with a carrier | The cutoff decides whether it ships today or tomorrow |
| Returns | Goods come back, get inspected, and a destination is decided | The step almost nobody has solved |
On top of those five sits a systems layer: inventory has to stay synced with the channels you sell on, so you don't sell something you no longer have.
What a 3PL does NOT do
This part gets told less often and prevents expensive misunderstandings:
- It doesn't sell for you. A 3PL doesn't find customers, doesn't do marketing and doesn't run your store.
- It doesn't own your inventory. The goods stay yours, with everything that implies: tied-up capital, obsolescence and purchasing decisions.
- It doesn't serve your end customer in most models. If someone complains, you're still the face.
- It isn't a carrier. It contracts and coordinates carriers, but they do the transport. If a parcel goes missing, the claim goes to the carrier — we cover it in what to do when a parcel goes missing.
- It doesn't fix a messy catalog. If your SKUs aren't properly defined, the problem gets amplified, not solved.
When doing it yourself stops making sense
Almost nobody needs a 3PL from their first order. At low volume, packing yourself is cheaper and teaches you your own operation. The tipping point isn't a sales figure — it's these signals.
- Packing ate your week. When the hours you spend preparing orders are worth more buying, negotiating or selling, you're already paying for a 3PL — just in your own time.
- Errors started costing reviews. One badly built order a month is an anecdote; five is a pattern your rating already shows.
- Peak season overruns you. If you hire in November for people you don't need in January, you're carrying a structure for three weeks of the year.
- You sell across channels and inventory never matches. Overselling is a matter of time when two channels read the same stock without syncing.
- Your warehouse is full. And the alternative is signing a lease for square meters you'll only fully use two months a year. We work that math in in-house warehouse vs. 3PL.
How a 3PL charges
The standard model has three components, and they're worth understanding separately because they don't scale alike:
- Storage, usually per rack position or cubic meter, per period. Scales with how much inventory you hold.
- Order preparation (pick & pack), per order and sometimes per extra line. Scales with how many orders you move.
- Shipping, typically the carrier's cost plus a margin or a negotiated rate.
On top come charges for specific services: receiving, labeling, kitting, returns handling. The breakdown with ranges and the fine print worth asking about is in what a 3PL costs in Mexico.
Red flag: a quote that gives you a single monthly number without breaking out these components is a quote you can't compare against another.
The 3PL's location sets your delivery times
An underrated detail when choosing: where the warehouse physically sits caps your delivery days before you negotiate a single rate. Transit isn't bought, it's inherited from geography. If you want to understand that effect, we cover it in what a logistics provider does and why its location matters.
Frequently asked questions
What does 3PL stand for? Third-party logistics. It's a company that executes the logistics operation — storage, order preparation and shipping — on behalf of a brand that remains the owner of the inventory.
What's the difference between a 3PL and a carrier? A carrier moves parcels from point to point. A 3PL stores your inventory, builds the orders and contracts the carrier for transport. A 3PL uses several carriers; a carrier doesn't store your inventory.
Is a 3PL worth it if I sell a little? At very low volume it rarely is: packing yourself is cheaper. The conversation makes sense when the time you spend on the operation is already worth more elsewhere, or when errors start costing you reviews.
Do I lose control of my inventory with a 3PL? You shouldn't. A good provider gives you real-time visibility of your stock, your orders and their status. If you can't see your inventory whenever you want, that's the problem to solve before signing.
What's the difference between 3PL and fulfillment? Fulfillment is one of the things a 3PL does: preparing and shipping orders. A 3PL usually also covers storage, inventory management and returns. All fulfillment is part of a 3PL; not every 3PL stops at fulfillment.
If two or more of those five signals describe your operation, the conversation is already worth having. See our 3PL service in Mexico and tell us how many orders you move per month.