How to evaluate
a U.S. 3PL

Define the requirement first.

Give every candidate the same written brief. Include SKU count, dimensions and weights, packaging, inbound format, storage needs, expected order mix, destinations, channels, returns policy and systems. Distinguish known demand from a forecast; describe peaks and uncertainty without presenting a guess as a commitment.

Identify work beyond a standard parcel order: bundles, kitting, fragile handling, lot or serial tracking, wholesale cartons, retailer labeling, appointments and replenishment. Ask each provider to identify what it performs itself, what it subcontracts and what it cannot support.

Write down the required outcome and who can approve exceptions. A provider cannot reliably implement an instruction that the company has not decided.

Walk one order through the system.

Use a representative order, not a polished demo alone. Trace receiving, inspection, stock availability, order import, picking, packing, dispatch, tracking and a return. Then test a shortage, a duplicate order and a cancellation after work has started.

Ask which system is authoritative for each state, when information updates and who resolves mismatches. A storefront marking an order cancelled does not by itself prove the warehouse has stopped working on it. For Shopify, the exact cancellation and fulfillment behavior depends on the service and its integration; verify the working path with the provider.

Request a sample receiving report, inventory report, exception record and invoice. Redacted examples are enough to inspect whether the information is usable. A sales claim about visibility should translate into a record your team can actually access.

Compare the complete scope.

Ask each candidate to price the same product and order scenarios. Include receiving, storage, picks, additional items, packaging, labels, returns, special projects, systems, account management and any minimums. Show carrier charges and surcharges separately. Record every assumption and charge that remains open.

A simple single-item order and a mixed multi-item order can produce different costs. Compare the scenario relevant to your business; do not extrapolate one advertised rate across every order. This is a comparison method, not a forecast or promised saving.

Check who approves nonstandard work, how disputed invoices are handled, how terms can change and what leaving requires. Have the appropriate adviser review contractual, insurance and liability terms; an operating checklist does not replace that review.

A short evaluation grid.

Use one copy per candidate. Mark each criterion Confirmed, Open or Does not fit, and write the evidence beside it. Set any non-negotiable requirements before evaluation. Do not average a failed essential requirement into a good overall score.

Before stock moves.

1. Resolve essential open questions and document the chosen provider’s scope.
2. Assign receiving, inventory, orders, returns, billing and escalation owners on both sides.
3. Approve product data, labels, packaging, inbound instructions and the receiving record.
4. Test an order and an exception through the actual integration. Agree a fallback and stop condition.
5. Agree how opening stock will be reconciled, when it becomes available and how early issues will be reviewed.

Common traps: sending stock before receiving instructions are agreed; treating an integration badge as a completed test; leaving returns disposition undecided; or accepting a service target without its start time, exclusions and reporting definition.

If you already have a 3PL.

Start with the current agreement, actual records and recurring failures. Separate provider capability from unclear instructions, incomplete data and unowned handoffs. Replacing a warehouse may be necessary, but it also introduces a transition that needs its own scope.

The 3PL runs the warehouse. Physical Goods can manage the operation around it: provider evaluation, onboarding, reporting, billing questions and the follow-up that keeps unresolved work moving.