Running a 3PL without the right warehouse management software is like trying to manage a restaurant kitchen with handwritten tickets and a paper inventory list. It works until you get busy–then everything falls apart.
3PL warehouse management software gives your operation real-time inventory visibility, automated billing, and the ability to serve multiple clients without drowning in spreadsheets. For small to mid-size 3PLs handling anywhere from 500 to 50,000 orders per month, choosing the right WMS can mean the difference between scaling profitably and losing clients to billing errors and stockouts.
This guide covers what 3PL WMS actually does, the features that matter most, and how to choose software that fits your operation without breaking your budget or requiring a full-time IT staff.
What is 3PL warehouse management software?
3PL warehouse management software is specialized WMS built specifically for third-party logistics providers who manage inventory and fulfillment for multiple clients. Unlike standard warehouse software designed for single-company operations, 3PL WMS handles the complexity of tracking separate inventories, billing different clients at different rates, and providing each client visibility into their own stock.
The key difference from general warehouse software: multi-client architecture. Every feature–from receiving to billing to reporting–needs to work at the client level, not just the warehouse level.
A 3PL WMS typically includes:
- Multi-client inventory tracking: Separate inventory pools for each client, even when products share the same warehouse space
- Client-specific billing: Rate cards, automated invoicing, and fee tracking customized per client
- Customer portals: Web access where clients can view their inventory, track orders, and download invoices
- Multi-channel order management: Integration with each client’s sales channels (Shopify, Amazon, WooCommerce, EDI)
- Warehouse operations: Receiving, putaway, picking, packing, and shipping workflows with barcode scanning
Without dedicated 3PL software, warehouse operators often cobble together spreadsheets for billing, generic WMS that treats all inventory as one pool, and manual processes that break down as client count grows.
Core features every 3PL WMS needs
Not all 3PL warehouse management software is created equal. Some systems bolt on “multi-client” features as an afterthought. Others are built from the ground up for third-party logistics operations. Here’s what actually matters.
Automated billing and invoicing
Manual billing is where most small 3PLs hemorrhage time and money. Between storage fees, pick and pack fees, receiving charges, return processing, and kitting services, a single client invoice can require hours of spreadsheet work.
A proper 3PL WMS automates this entirely:
- Rate cards per client: Set unique pricing for storage (per pallet, per bin, per carton), transaction fees (pick, pack, receive, return), and value-added services (kitting, labeling)
- Automatic fee tracking: The system captures every billable transaction as it happens in the warehouse
- Invoice generation: Generate invoices automatically based on billing cycles (weekly, monthly, per order)
- Accounting sync: Push invoices directly to QuickBooks or Xero without manual data entry
The billing engine is often where 3PL software differs most from generic WMS. If your current system requires manual fee calculations, you’re leaving money on the table and creating opportunities for errors.
Real-time inventory visibility
Your clients need to know what inventory they have, where it is, and when they’re running low. A 3PL WMS provides this through:
- Live inventory counts: Updated instantly as receiving, picking, and shipping transactions occur
- Location tracking: Know exactly which bin, shelf, or pallet location holds each product
- Lot and expiration tracking: Critical for food, supplements, and regulated products requiring FIFO/FEFO rotation
- Low stock alerts: Notify clients (and your team) when inventory falls below reorder points
Without real-time visibility, you’re fielding constant “where’s my inventory?” calls and risking stockouts that damage client relationships.
Customer portal access
The best 3PL WMS includes a web portal where your clients can self-serve. This reduces your support burden and improves client satisfaction:
- Inventory dashboard: Clients see their current stock levels and locations
- Order tracking: View order status from received to shipped, with tracking numbers
- Invoice access: Download invoices without requesting them from your team
- Order placement: Some portals allow clients to create orders directly
- Report generation: Let clients pull their own inventory and fulfillment reports
A customer portal transforms your 3PL from a black box into a transparent partner. Clients who can check their own order status at 2 AM don’t need to call you Monday morning.
Multi-channel order integration
Your clients sell everywhere: Shopify, Amazon, WooCommerce, BigCommerce, TikTok Shop, and through EDI with retail partners. Your WMS needs to pull orders from all these channels automatically.
Look for:
- Direct platform integrations: Native connections to major e-commerce platforms
- Automatic order import: Orders flow in without manual entry
- Inventory sync: Stock levels update across all channels to prevent overselling
- Carrier integrations: Rate shop across carriers and print labels directly from the WMS
- Tracking updates: Push tracking information back to sales channels automatically
Manual order entry from multiple channels is a scaling bottleneck. Integration eliminates it.
Mobile scanning and warehouse workflows
Paper pick lists and clipboard-based receiving create errors. Mobile scanning with barcode verification catches mistakes before they ship:
- Mobile receiving: Scan products during inbound, generate pallet labels, verify quantities
- Directed putaway: System tells warehouse staff exactly where to store items
- Batch and wave picking: Optimize pick paths for multiple orders simultaneously
- Pack verification: Scan items during packing to confirm accuracy
- Cycle counting: Perform inventory counts without disrupting operations
The goal: warehouse staff shouldn’t need to return to a desktop computer to complete their tasks. Everything happens on the warehouse floor with handheld scanners.
Advanced features for growing 3PLs
Beyond the basics, certain features become critical as your operation scales or serves specialized clients.
Pallet management with LPN tracking
If you handle B2B fulfillment, wholesale distribution, or pallet-in/pallet-out operations, pallet-level tracking is essential:
- License Plate Numbers (LPNs): Unique barcode for each pallet, tracked through receiving, storage, picking, and shipping
- Mixed pallet support: Track multiple SKUs on a single pallet with accurate quantities per SKU
- Cross-docking: Route incoming pallets directly to outbound shipments without storage
- Pallet-level billing: Charge storage fees at the pallet level, not just carton or unit
Many 3PL WMS platforms focus heavily on DTC e-commerce and treat pallets as an afterthought. If B2B is part of your business, verify pallet capabilities before committing.
Lot and serial number tracking
For clients in food, supplements, pharmaceuticals, or high-value goods, compliance requirements demand full traceability:
- Lot tracking: Capture lot numbers at receiving, maintain through storage, ensure correct lot ships
- FIFO/FEFO rotation: System automatically picks oldest inventory or nearest expiration first
- Expiration alerts: Flag inventory approaching or past expiration dates
- Serial number tracking: Individual serial capture for electronics, equipment, or regulated items
- Traceability reports: Pull complete chain of custody for recalls or audits
Lot tracking isn’t optional for many industries. Shipping expired products or failing an audit costs more than any WMS subscription.
Kitting and assembly
Some 3PLs offer value-added services like kitting, bundling, or light assembly. Your WMS should support:
- Bill of materials: Define kit components and quantities
- Component inventory tracking: System pulls components from inventory when kits are built
- Finished kit inventory: Track assembled kits as separate SKUs
- Kit-specific billing: Charge clients for kitting services based on complexity
Without WMS support for kitting, you’re tracking component usage manually and likely undercharging for the service.
EDI connectivity
Enterprise retail clients (Target, Walmart, Costco) require EDI communication. Look for:
- EDI 850: Receive purchase orders electronically
- EDI 856: Send Advanced Ship Notices with carton contents
- EDI 810: Transmit invoices electronically
- Trading partner setup: Support for multiple EDI connections per client
EDI capability opens doors to larger clients but adds complexity. Make sure your WMS vendor has experience with the specific trading partners your clients need.
How to evaluate 3PL warehouse management software
With dozens of options on the market, here’s how to narrow down the right fit for your operation.
Assess your operation size and complexity
Be honest about where you are today and where you’re heading:
- Order volume: Some platforms are built for high-volume DTC (50,000+ orders/month), others for lower-volume B2B operations
- Client count: Managing 5 clients is different from managing 50
- Fulfillment type: Primarily DTC e-commerce, B2B wholesale, or mixed
- Special requirements: Lot tracking, temperature monitoring, hazmat, international shipping
A system designed for enterprise 3PLs processing 100,000+ orders monthly may be overkill (and overpriced) for a growing operation doing 5,000 orders.
Prioritize implementation speed
Enterprise WMS implementations can take 6-12 months. Small to mid-size 3PLs can’t afford that disruption. Look for:
- 2-5 week implementation timelines for straightforward operations
- Included training for your warehouse staff
- Data migration assistance to import existing inventory and client data
- Go-live support during your first week of live operations
Ask vendors about their average implementation timeline for operations similar to yours. Get references from customers who implemented recently.
Evaluate total cost of ownership
3PL WMS pricing varies dramatically:
- Per-user fees: Some charge per user, making it expensive to add warehouse staff
- Per-client fees: Some charge per client, penalizing you for growing your business
- Volume tiers: Many price based on monthly order volume
- Implementation fees: One-time setup costs ranging from a few hundred to tens of thousands
- Integration fees: Additional charges for e-commerce or EDI connections
Calculate total cost for your operation, including projected growth. A system that’s cheap at 10 clients might become expensive at 50.
For context, small to mid-size 3PL WMS solutions typically range from $750 to $3,000 per month, while enterprise platforms start at $2,000+ and can exceed $10,000 monthly.
Request demos with your actual workflows
Generic demos don’t reveal how software handles your specific challenges. Prepare scenarios for your demo:
- “Show me how you’d set up billing for a client who pays weekly storage plus per-order pick fees”
- “Walk me through receiving a mixed pallet with three different SKUs and lot numbers”
- “How would my client view their inventory and place an order through the portal?”
- “What happens when an order comes in for a product that’s out of stock?”
Watch how many clicks it takes. If basic tasks require navigating through multiple screens, your team will struggle with adoption.
Common mistakes when choosing 3PL WMS
Overbuying for “future needs”
Enterprise platforms with AI-powered optimization and thousands of configuration options sound impressive. But if you’re running a 5,000 order/month operation, you don’t need (or want) that complexity. You need software that works out of the box with minimal configuration.
Buy for where you are now, with room to grow. Don’t pay for features you won’t use for years.
Underestimating billing requirements
Generic WMS platforms often have weak or nonexistent billing modules. If you’re evaluating a system primarily designed for single-company warehouses, ask hard questions about multi-client billing:
- Can we set different rates for different clients?
- Does the system track storage fees automatically at the pallet/carton/bin level?
- How do we handle custom fees like kitting or special handling?
- Does billing sync to our accounting software?
Retrofitting billing onto a system that doesn’t support it natively leads to manual workarounds and errors.
Ignoring mobile capabilities
If warehouse staff need to return to desktop computers to complete tasks, you’re creating bottlenecks. Verify that mobile scanning covers all critical workflows: receiving, putaway, picking, packing, cycle counting, and inventory lookup.
Also confirm device compatibility. Some systems require specific hardware (Zebra scanners, certain Android versions). Others are more flexible. Make sure the WMS works with devices you already own or can easily acquire.
Skipping reference checks
Ask vendors for references from 3PLs similar to your size and operation type. Then actually call them. Questions to ask:
- How long did implementation really take?
- What’s support response time like when you have issues?
- What features work better or worse than expected?
- Would you choose this system again?
Vendor demos show the best-case scenario. Reference calls reveal the daily reality.
Making the switch: implementation best practices
Once you’ve chosen a 3PL WMS, a smooth implementation requires preparation.
Clean your data first
Garbage in, garbage out. Before migration:
- Audit your item master for duplicates and inactive SKUs
- Verify client information is complete and accurate
- Reconcile physical inventory to your current records
- Document your rate cards and billing terms for each client
Data cleanup before migration is far easier than fixing problems after go-live.
Phase your rollout
Unless you’re starting from scratch, consider a phased approach:
- Start with new clients: Onboard new clients directly into the new WMS
- Migrate low-complexity clients: Move simpler clients next to build confidence
- Migrate complex clients last: Tackle clients with custom requirements after your team has experience
Trying to migrate everyone simultaneously creates chaos. Phased rollout reduces risk.
Train warehouse staff hands-on
Don’t rely solely on documentation. Schedule hands-on training sessions where staff actually use the system:
- Practice receiving workflows with sample products
- Run through picking scenarios from order to shipment
- Simulate common exceptions (damaged items, missing inventory, returns)
- Let staff make mistakes in a safe environment before go-live
The best 3PL WMS is intuitive, but even intuitive systems require practice.
Conclusion: choosing the right 3PL WMS
The right 3PL warehouse management software eliminates manual billing headaches, gives your clients real-time visibility, and scales with your operation without requiring enterprise budgets or IT staff.
Focus on what matters for your operation today: robust billing automation, multi-client inventory tracking, mobile scanning workflows, and integrations with your clients’ sales channels. Avoid overbuying enterprise features you won’t use, and prioritize implementation speed over feature counts.
Your WMS should make running a multi-client 3PL simpler, not more complicated. If a system requires months of implementation and dedicated technical staff, it’s probably not built for growing 3PLs.
Ready to see how 3PL warehouse management software can transform your operation? Schedule a demo to see PackemWMS in action with your actual workflows.
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