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3PL Receiving: A High-Level Overview

Any company that has shipped goods to a retailer (for resale) has learned about that retailer’s specific requirements for receiving goods. All major retailers – Macy’s, Walmart, Target, and others have some sort of written requirements for receiving a brand’s goods. Most minor retailers have some sort of receiving guidelines as well. Guidelines will include info about receiving department hours, pallet height, whether pallets can be stacked or not, and other similar specifications.

Retailer Receiving

Brands that have a B2B component to their program will send their 3PL partner the retailer’s routing guide. The 3PL then complies with those requirements when product is shipped out to them.

Compliance involves a 3PLs B2B team looking at the shipping window (the date range when orders can be received by the retailer) and working backward from that receipt date. The 3PL routes the package according to the requirements in the routing guide and packs it up based on the specs in the packing guidelines.

3PL Receiving

3PLs also have guides for receiving product at their warehouses. Each facility has its own inbound routing guide with detailed instructions for getting shipments into the warehouse.

The routing guide for 3PL receiving details how to schedule the deliveries, how the cartons and pallets should be labeled, and how to pack/arrange all of the items in the shipment within, for example, a shipping container. There’s even guidance for how to get full truckloads (FTL) or less than truckloads (LTL) of products delivered.

***TIP: Keep in mind that every warehouse is different, and not all warehouses deal with floor loaded containers. Some facilities specify only pallet loaded containers. When you’re arranging shipment of product, you’ll want to make sure that it can be received by the 3PL – a refused delivery can really mess up your day.

The speed of handling deliveries is also important. Quick turnaround is key – ideally, a warehouse should be able to turn around delivery trucks in less than an hour. That includes the time between when the truck bumps the dock to when it leaves after being unloaded.

Speaking of unloading – having the available space to stage all inbound product is important. A 3PL should have enough space to handle inbound shipments from all of their clients, with reserve locations for peak periods (like the holiday season).

Because there’s so much to consider, it’s a good idea for 3PLs to allow their brands to white label the routing guides. White labeling is simply the process of adding the brand’s logo and company info to the document, to make it look like their own. The brand can then share the document as if the requirements were coming directly from them.

POs and ASNs

All of this really starts with the Purchase Order or the Advance Ship Notice. Those are the documents that get loaded into a 3PLs Warehouse Management System with the total number of pallets and the total number of cartons when the delivery is scheduled.

In the case of Dotcom Distribution, each item in each carton is labeled with a unique barcode as a control for product, receiving, put away, picking, and packing. The outside of the package must also be marked with details such as the brand’s company name, the PO or ASN number, the product item number, and some other details including whether the items contain hazardous materials.

What’s that you say? You’re just shipping lipstick? Some products, like health and beauty items, can contain small amounts of a hazmat material that, in the aggregate, may pose a risk if there’s a spill or if there’s damage to the delivery). Lithium-ion batteries also fall into this space. The routing guide contains information about this and includes a number of images showing things like where on cartons the label must be applied. There are a number of helpful graphics in a routing guide showing inner pack, to case packs, to fragile item labels, to the proper labeling of cartons that include a mix of items.

So how does a 3PL ensure everything received is put away properly?

The receiving process can certainly seem like chaos to the untrained eye, but look closer and you’ll start to see some method to the madness.

Mixed cartons are common for health and beauty brands. For apparel brands, one style of clothing may contain multiple SKUs, each one a different size. To manage this variety, a copy of the PO or ASN gets matched up with the bill of lading so that the receiving team can receive against the items that are expected.

What role does a Program Manager play in all of this?

If there are discrepancies between the PO / ASN and the bill of lading, they will be noted and conveyed to the brand through a program manager (every brand should have a named program manager at their 3PL as a point of contact and to manage high-level issues).

A brand should think of their Program Manager as their eyes and ears in the warehouse. PMs are also the people who will convey the checks done by the receiving QA team on a mutually agreed upon percentage of receipts.

In sum, if you follow the routing guide, everything will be okay. Your product will be received and ready for sale as quickly as possible.