3PL warehousing and distribution are two jobs that a third-party operator does for the same client with the same stock: warehousing holds it, distribution gets it to the client's customers as orders, whether that is cartons to a retailer's distribution centre or parcels to consumers. They meet on the floor at the pick path, where stock stops being storage and starts being an order, and the operator's margin is made or lost in the minutes between. This page is about how a small 3PL runs both jobs on one floor and what has to be written down for each; the free warehouse SOP template worksheet on this site sizes that pack per client.
Warehousing: the stock, held and counted
The warehousing job is receiving, putaway, storage and counting, billed as space and inbound handling. Its procedures are the receiving check and the putaway rule per client, and its figure is accuracy. Done well it is invisible; done badly it shows up in distribution as a pick that finds an empty location, which is the most expensive way a warehouse can discover a count was skipped.
Distribution: the order, picked, packed and gone
The distribution job is picking, packing and shipping to a cut-off, billed as outbound handling per order or per line, sometimes with carrier charges passed through. Its procedures are the picking method and the packing spec per client, which differ most between a retail client wanting cartons labelled to a routing guide and an e-commerce client wanting a branded parcel. Its figures are lines an hour, orders an hour and the cost per order.
Where they meet: the pack per client
A client using both services needs the full set: receiving, putaway, picking, packing and returns, each with the client's variant. Five processes with a base and a variant for each of three clients is 20 SOPs, 240 steps at 12 a piece, and 192 hours of training for a team of 12 at four minutes a step. Pickpathly Pro keeps the pack per client with versions and review dates, and the week's figures beside it.
Questions people ask about 3pl warehousing and distribution
What is the difference between warehousing and distribution?
Warehousing is holding stock: receiving, putaway, storage, counting. Distribution is moving it out as orders: picking, packing, shipping. A 3PL usually sells both to the same client and runs them on one floor.
Does a 3PL handle transport as well?
Some do, some arrange carriers and pass the cost through, some leave it to the client. This site covers the warehouse and the order up to the dock; freight, carriers and transport management are outside its scope.
What does a distribution client need that a storage client does not?
A picking method, a packing spec and a shipping procedure per client, and the outbound figures reported weekly. The SOP worksheet counts the extra procedures; the reports worksheet works the figures.