9 Key Performance Indicators for Monitoring 3PL Operations

There comes a point in every growing brand's journey when in-house fulfillment no longer makes strategic sense. That's when forward-thinking companies turn to 3PLs like Capacity. While outsourcing fulfillment is transformative for operations, it does mean letting go of direct warehouse oversight. The key question becomes: How do you maintain visibility and control when you're no longer handling day-to-day operations?

Rest assured – with the right metrics and partnership, monitoring your 3PL performance becomes straightforward and insightful. Here's what matters most for brands in 2025...

First Steps: Define Your Strategic Objectives

Before diving into metrics and KPIs, it's essential to clearly define what success looks like for your brand's fulfillment operations. Consider these key questions:

• What are your broader logistics objectives?
• What delivery timeline expectations do your customers have?
• What ROI are you targeting from outsourced fulfillment?

The Essential KPIs for Modern Brands

1.On-Time Shipping: The Foundation of Customer Satisfaction

Here's a compelling reality: 87% of online shoppers consider delivery time when making purchasing decisions. Your customers expect consistent, timely delivery, and we're here to make that happen. At Capacity, we maintain comprehensive tracking of every shipment's journey.

2. Shipping & Order Accuracy: The Non-Negotiables

Brand loyalty can be severely impacted by incorrect shipments or misrouted packages. We maintain accuracy rates above 99% because anything less creates unnecessary friction in the customer experience.

3. Order Accuracy

Just as with shipping accuracy, it’s not enough for packages to simply reach the correct address—they must also contain the correct items. Ensuring the right products get to the right customers is essential, and if order accuracy falls below 99.8%, it’s time to consider partnering with a company that offers higher accuracy.

4. Inbound Receiving: Preventing Lost Revenue

Stock-outs represent direct revenue loss. When your inventory arrives at our warehouse, the dock-to-stock process needs to be swift and precise. Modern fulfillment can't afford delays between receipt and availability.

5. Order Time-to-Fill: Controlling What We Can

While final-mile carriers control delivery timing, your 3PL determines how quickly orders leave the warehouse. At Capacity, we focus on optimizing every step of the fulfillment process to minimize processing time.

6. Inventory Accuracy: Data You Can Trust

Accurate inventory data is fundamental to effective business planning. Approximations and estimates simply don't cut it in today's fast-moving market. Our system maintains precise counts you can confidently use for forecasting and decision-making.

7. Returns: Streamlined Reverse Logistics

Returns are a natural part of modern commerce. What matters is how efficiently they're processed. Our standard is 48-72 hour processing for 95% of returns, ensuring your inventory remains accurate and available.

8. Damage Prevention: Protecting Your Brand Experience

While some transit incidents are inevitable, consistent damage patterns often indicate a need for improved packaging or handling protocols. We continuously monitor damage rates and proactively adjust procedures to protect your products.

9. Cost Per Unit: Strategic Oversight

Regular monitoring of your cost-per-unit shipped provides vital insight into operational efficiency. We provide transparent breakdowns of all costs, allowing you to make informed decisions about your fulfillment strategy.

The Capacity Advantage

Monitoring your 3PL shouldn't be a full-time job. At Capacity, we provide comprehensive 24/7 access to all relevant metrics through our client portal. Our account managers don't just deliver data – they provide strategic insights and recommendations based on your specific business needs.

Think of us as your strategic logistics partner: committed to transparency, focused on continuous improvement, and dedicated to elevating your brand's fulfillment experience. In today's competitive market, your fulfillment operation needs to be a strategic advantage, not just a cost center.

Ready to transform your fulfillment operations for 2025? Let's discuss how Capacity can help you achieve your strategic objectives.