3PL Best Practices For Success 

It’s time for 3PLs to take control of their billing once and for all. 3PLs who still rely on manual administration for their billing and invoicing processes are almost certainly leaving their business open to lost revenue, as well as lost time and resources. 

In the 2024 Third-Party Logistics Warehouse Benchmark Report, 56% of businesses surveyed said that ‘Uncaptured charges’ were their biggest billing challenge. Furthermore, the same survey asked respondents about their technology adoption plans for 2025, in which the respondents ranked ‘Billing and Invoicing’ (35%) as the top functionality to implement in the coming year. 

Mintsoft’s Head of Sales & Partnerships, Rob Hodgson, said:  

"I started consulting and implementing 3PL WMS software in 2006. I didn’t expect 18 years on, we’d still be solving the problem of billing manually, but I'm glad we can! We regularly hear from 3PLs that are considering Mintsoft that they’re still consolidating activities into a spreadsheet, running calculations themselves and then manually transferring the data to their accounting software. This not only takes them hours to do, but is resulting in missed revenue. Your clients might be happy with lower invoices, but are you?" 

Billing Process 

The 3PL billing process often follows the same key steps for all clients:  

1. Contract agreement: a contract between 3PL and the client will be drawn up and signed by both parties, detailing the services to be provided, the rates to be paid, cadence of billing and terms of payment, i.e. monthly and via which payment methods.  
2. Data consolidation: for each invoice, data relating to the services provided will be gathered, charges applied, and totals calculated. This can include storage, handling, picking, courier costs and more.  
3. Create and issue an invoice: once totals have been calculated, relevant data will be transferred and an invoice generated. Typically, these will include the calculations of the services provided, for example, X items picked at a cost of £Y per item = £Z. These are then issued to the client to process for payment.  

3PL Billing Methods 

3PL billing can be complex with a wide range of chargeable activities, differing rates for each client, as well as supplier costs to factor in for things like transportation and packaging.  

Here’s a comprehensive list of all the types of charges 3PLs use: 

• Receiving and handling: charges for receiving goods, inspecting them for damage and processing them for storage. 
• Storage: charges for holding goods in a location. These can be set by pallet size, square or cubic footage, inventory quantity and by the length of time goods are held. 
• Order processing: charges for actions such as relabelling, reworking, picking, packing, and packaging. 
• Shipping and transportation: charges for the movement of products, whether via courier to the end consumer or to another destination. 
• Returns: charges for receiving, inspecting, restocking and disposing of returned goods.  
• Value-add services: charges for processes that are not already covered, such as custom packaging, product or bundle assembly, product personalisation and quality checks.  

3PLs choose to bill their clients in a variety of ways – usually to align with the services they offer – which can include activity-based pricing, fixed pricing models, varying price ranges or rates that are based on quantity, volume, weight or dimensions of products. It can further extend to the options of hourly rates, flat rates and even per-item rates.  

There is no single best way for a 3PL to choose to bill clients, and no matter how you charge, your billing activity is only as accurate as the data that is included in every invoice. 

3PL Billing Challenges 

Running a 3PL is challenging enough, only made more stressful by the complexities of billing multiple clients, all with different rates and requirements. Some of the common challenges faced by 3PLs who are still relying on manual administration for invoicing are: 

Activity Tracking / Consolidation  

Activity tracking and invoice consolidation are the root cause of almost all 3PL billing challenges. Manually logging and tracking all the costs and warehouse activity for all of your clients is time-consuming, prone to human error and virtually impossible to do. Your warehouse is simply too busy for manual tracking to lead to accurate, fully detailed and indisputable billing.  

Consolidation is the same – even with spreadsheets and formulas to calculate invoiceable totals, the likelihood of all line items being accounted for, all charges being correct, and everything being transferred to your accounting software without mis-keying data is low. 

Under and Over Charging 

Undercharging is easily done when you’re unable to truly account for every action taken by your team, on behalf of your clients. Without accurate record keeping, missing line items on invoices is a common error and leads to you losing valuable revenue without even realising. 

Overcharging is just as common an issue, for similar reasons. If your records aren’t 100% accurate and reliable, assumptions may need to be made, and therefore, extra charges can easily be added. This can quickly lead to queries and your clients challenging invoices, or even refusing to pay. 

Invoice Queries 

Invoice queries are an inevitable result of the above mentioned challenges. Not only are they frustrating for you and your clients, but they’re a drain on your time and resources. The time it takes to prove your invoices are accurate, or finding the error, communicating back and forth with your clients and chasing payment, is time you could spend building better client and supplier relationships, optimising warehouse performance or growing your client base.  

Client Confidence 

Incorrect, inaccurate and unreliable invoices all lead to your clients losing faith in you and your business. The brands you work for are relying on you to represent them, and losing that trust via overcharging or constant queries is a sure way to end otherwise successful client relationships.  

Automating Your 3PL Billing 

Automating your 3PL billing processes can save you a significant amount of time. With 3PL software with billing capabilities, the tool should help you to speed up the entire process and ensure every cost is accounted for, ensuring you’re charging for all the work you’ve done.  

A good 3PL billing software should offer you the following:  

• Set client rates: store the rates you’ve set per client, including costs for storage, handling, picking, rework, shipping and returns, so manual adjustments are not needed 
• Track stock movements and fulfilment activities: keep detailed records of all work performed on behalf of clients, to ensure no item is missed off your invoices 
• Itemised billing: give your clients complete transparency in your billing, so they can see the breakdown of charges and reduce the potential for queries 
• Accounting software integration: sync your 3PL software to your accounting software, so invoice details are automatically transferred, without manual data rekeying 

Don’t underestimate the power of transparency for your 3PL client relationships. Billing is a core part of any partnership and can be a bone of contention if not done correctly. Under or overcharging can cause a rift between you and your clients, and invoice queries are incredibly time-consuming to investigate and resolve. Nobody wants to be chasing invoices and having those awkward conversations about whether a line item is correct! 

Additionally, using a trusted 3PL software can give you, your existing clients, and the clients you’re trying to secure, the confidence that the relationship you hold will be built on strong foundations, and that you can be relied upon to charge based on what’s been agreed, without any hidden surprises. 

By providing exceptional support, ensuring your team always acts with integrity, and offering a tailored service, you can help improve customer satisfaction levels and win clients’ long-term loyalty. Read on for our detailed list of the areas you should cultivate to help strengthen your client relationships.   

1. Technology 

By helping to centralise, automate, and streamline your operations, a great tech stack can provide speed and efficiency. This makes your tech an essential part of landing new clients and maintaining a partnership with them.   

The tech you use to deliver your services can also be a deciding factor for customers when choosing their 3PL provider. For example, fulfilment speeds can be a huge draw for customers, and the use of automation like picking and packing robots that use light or AR to pick and pack quickly and efficiently can save you hours and help workers avoid mistakes, improving the speed at which products get into the hands of customers.   

While client portals and similar platforms that offer visibility into the ins-and-outs of your services and operations can give clients confidence and help provide a more seamless customer experience.  

You can use 3PL warehouse management software to effectively support your client relations by easily tracking and managing client rates, inventory, and queries from one place.    

2. Supplier & Partner Relationships 

Your clients perceive your suppliers & partners as an extension of your business. How well they perform and the integrity they bring to the job, will reflect either well or poorly on your business.   

Strong supplier and partner relationships with capable, reputable suppliers that share your work ethos help ensure that you can deliver your services efficiently and on time, helping to make sure there are minimal delays or disruptions to fulfilling clients’ orders.   

3. Tailored Services 

When it comes to delivering a great client experience, it’s important to tailor your services to suit the individual needs of your client.   

For every client, consider how you can provide tailored services to support their business needs, such as gift wrapping, unboxing experiences, or branded customisation like name and logo printing. These efforts will help your clients feel valued, help them retain customers, and make you stand out as a provider who goes out of their way to provide an exceptional, personalised service.   

4. Your Team 

One of the most important elements of building client relationships is hiring people who will leave a great impression on your clients. 95% of B2B consumers say great customer service is important for them to feel loyal to a company. While companies that develop an emotional connection with clients see 85% more sales growth than their competitors.   

To deliver consistently supportive customer service and build a strong emotional connection with your clients, hire people who are caring, warm, knowledgeable, and who act with integrity.  

Account managers should be proactive; they should have an in-depth understanding of your clients’ needs, pain points, and goals and be able to provide forward-looking insight on how they can improve their processes, as well as provide information on the services that will support their operations best as their business grows.   

5. Sustainability 

Many retailers have ESG goals and are looking to partner with sustainable 3PLs that can align with or help them hit these goals. Making a commitment to sustainable 3PL warehousing best practices can help you both win new business, differentiate your business from your competitors, and help support customer loyalty.   

Practices like carbon-neutral delivery, using green energy, ensuring good recycling procedures, and using sustainable suppliers are all great ways to make moves towards becoming a more environmentally-conscious company.   

6. Continual Improvement 

The fulfilment industry moves quickly and is subject to sudden market changes. Customers expect responsiveness, reliability, and ever-faster delivery times. To help protect your client relationships, you must quickly respond to any market developments and shifting customer expectations and needs.  

The 3PLs with the most loyal clients are the ones that don’t just look to impress customers at the acquisition stage, but that continually look to improve their services and impress clients with their industry expertise, advanced technology, and personalised, supportive service. The most successful companies also regularly ask for and implement client feedback, showing their commitment to providing the best client experience for their loyal customers.   

Sustainability isn’t an option for 3PL providers; it’s a competitive advantage. By adopting green practices, you can reduce emissions, cut waste and lower energy consumption while improving efficiency.  

1. Reduce Emissions Through Route Optimisation  

Efficient route planning reduces unnecessary mileage, reduces fuel consumption, and lowers carbon emissions. Using advanced routing software to consolidate deliveries, avoid traffic and select the most direct path.  

2. Eco-Friendly Transport Options 

Switching to greener transport methods is a big step towards sustainability. Electric vehicles are ideal for last-mile delivery, reducing reliance on fossil fuels. Hybrid fleets combine traditional fuels and electric vehicles to gradually transition to eco-friendly vehicles without disrupting. 

3. Sustainable Packaging 

Packaging is a key area for waste reduction: 

• Recyclable materials: Use cardboard, paper and biodegradable alternatives instead of plastic.  
• Right-sized packaging: Avoid oversized boxes to reduce materials use and shipping inefficiencies.  
• Minimal filler: Replace plastic fillers with recycled paper or compostable options. 

4. Energy-Efficient Warehousing 

Warehouses consume a significant amount of energy due to spaces requiring constant client control and high-intensity lighting. Small changes can make a big impact. LED lighting reduces energy use compared to traditional lightbulbs. Solar panels generate renewable energy and lower reliance on the grid. HVAC systems maintain optimal temperature without excessive energy consumption.  

5. Smart Inventory Management  

Overstocking can lead to wasted space, higher energy costs and potential product spoilage. Inventory management software, such as Unleashed, can track your stock levels in real-time, forecast demand accurately ensuring you have the right amount of stock on hand every time.  

Mintsoft’s cloud-based 3PL software combines billing automation with client relationship tools: Automated invoicing linked to accounting software, Client portals for real-time visibility, and customisable workflows for tailored services. 

Alex Large from Radius Warehouse and Logistic Services says:  

“The feature I get the most enjoyment from is the ability to set up bespoke rules and features for our clients, a key ethos of the company.  

“Fundamentally, our fulfilment customers all want their inventory handled safely and dispatched in time, but they all work differently and have quirks to how they operate, which are important to them. With Mintsoft, we can represent them as best we can, with different features such as order tags, automating order rules and means of dispatch.” 

Adopting these best practices ensures your 3PL business remains competitive, efficient, and trusted. From accurate billing to strong client relationships, the right technology makes all the difference. 

Take the complexity out of billing and client management with Mintsoft’s powerful 3PL software. 

Book your free demo today and discover how automation can save you time, reduce errors, and strengthen client relationships.