What is an SSCC label?

A Serial Shipping Container Code (SSCC) is a globally unique 18-digit number used to identify logistics units, like pallets. Major retailers require SSCC labels on every pallet so they can scan it at their dock and instantly know the contents.

What is shrinkage in a 3PL?

Shrinkage is inventory that is lost, stolen, or damaged while in the 3PL's custody. A standard 3PL contract includes a shrinkage allowance (often 0.5% to 1.5%), meaning the 3PL is not financially responsible for losses below that threshold.

Should I use a different 3PL for DTC and Wholesale?

Many brands do. DTC fulfillment requires picking individual units and shipping via FedEx/UPS. Wholesale requires picking full pallets and shipping via LTL freight. Finding a single 3PL that excels at both is difficult, though they do exist.

How to Choose a 3PL for Your Food Brand

Choosing a Third-Party Logistics (3PL) provider is like choosing a co-founder for your supply chain. If they are excellent, your customers are happy and your margins are protected. If they are incompetent, you will bleed cash through expired inventory, damaged freight, and retailer chargebacks. Here is how to evaluate a 3PL specifically for a food or beverage brand.

1. Food-Grade Certification and Temperature Control

Do not put your food product in a generic e-commerce warehouse that primarily ships t-shirts. You need a food-grade facility. At a minimum, the facility must be registered with the FDA. Ideally, they should hold a GFSI-recognized certification (like SQF or BRC).

If your product requires temperature control (frozen, refrigerated, or simply "climate-controlled" ambient to prevent chocolate from melting), you must verify their temperature logging systems. Do they have backup generators? Do they log temperatures continuously?

2. FEFO Routing and Lot Traceability

This is the most common point of failure for generic 3PLs handling food. A standard 3PL operates on FIFO (First In, First Out) based on the date the pallet arrived at their dock. Food brands require FEFO (First Expired, First Out) based on the expiration date printed on the product.

If a 3PL's Warehouse Management System (WMS) cannot systematically enforce FEFO routing, they will inevitably ship fresh product while older product rots in the back of the rack. Furthermore, they must be able to electronically record the exact lot code shipped to every customer to comply with FDA recall requirements (FSMA 204).

3. EDI Capabilities for Wholesale

If you are selling to UNFI, KeHE, Whole Foods, or Target, you will be required to use EDI (Electronic Data Interchange) to transmit Purchase Orders, Advance Shipping Notices (ASNs), and Invoices.

Your 3PL must be capable of generating EDI 856 (ASN) documents and applying SSCC-18 barcode labels to the pallets. If they cannot do this, you will be hit with massive chargebacks from the retailers for non-compliance.

4. The Hidden Costs in the Pricing Agreement

3PL pricing is notoriously opaque. Beyond the standard storage fee (per pallet/month) and pick-and-pack fee, look for the accessorial charges:

Inbound Receiving: Do they charge per pallet, per case, or per hour to unload a truck?
Account Management: Is there a flat monthly fee just to be a customer?
Integration Fees: What do they charge to connect their WMS to your Shopify store or ERP?

Connecting Your 3PL to Your Operations

Your 3PL's WMS must talk to your inventory operations platform. If you use a system like Guidance, it will automatically pull daily inventory snapshots and shipment confirmations from the 3PL, ensuring you always know exactly what is available to sell without logging into a clunky third-party portal.