What is a 3PL (third-party logistics)?

October 30, 2026

A 3PL, or third-party logistics provider, is a company that stores stock and fulfils orders on behalf of other businesses. It receives the retailer's stock, picks, packs and ships each order, and often handles returns, charging for storage and for each order it processes.

Why it matters for online retailers

A 3PL lets you grow without taking on your own warehouse and team. It also lets you hand off peaks such as Christmas. The trade-off is less direct control over speed, packing quality and costs.

How a 3PL works

You send stock to the 3PL's warehouse.
Orders from your sales channels pass to the 3PL.
The 3PL picks, packs and ships each order.
Tracking goes back to your channels and customers.
The 3PL handles returns and reports stock levels to you.

Pros and cons

Pros: no warehouse lease or staff to manage, room to scale, shared carrier rates.
Cons: storage and per-order fees, less control, and your stock data depends on their systems.

What to look for in a 3PL

Integration with your sales channels, so orders and stock sync automatically.
Clear pricing for storage, picking, packing and returns.
Cut-off times and despatch speeds that meet your marketplace promises.
Client access to live stock and order status.

How StoreFeeder handles it

StoreFeeder offers a 3PL portal, built for logistics providers that run fulfilment for several clients. Retailers who keep fulfilment in-house can use StoreFeeder's warehouse management instead.

Read more about the StoreFeeder warehouse management system.

Frequently asked questions

What does 3PL stand for?

Third-party logistics: a separate company handling storage and fulfilment for you.

When should I move to a 3PL?

Often when you run out of space or staff, or when peaks become hard to handle. Some retailers grow by keeping fulfilment in-house with better warehouse software instead.