Nutraceutical Fulfillment and 3PLs

Date: June 19, 2020


How to Stay Ahead of the Demand Curve

From dietary supplements, medical or designer foods, nutritionally functional foods known as “nutraceuticals” have spiked in consumer markets. This rapidly growing industry, fueled by the popularity of healthy living, is projected to reach a net worth of $722.49 billion by 2027. Like most expanding markets, the need to fulfill nutraceutical products through third-party warehouses (3PLs) is quickly increasing to meet consumer demands.

For 3PLs to take advantage of this growing marketplace, they must be able to optimize their warehouse and workflows to meet very specific needs. For example, nutraceutical warehouses must offer customers value-added services such as kitting and assembly, cold storage for temperature sensitive inventory, and custom product labeling/packaging. All of these services require warehouse inventory management software to operate efficiently. In some cases, warehouses may already have these services available to their customers who are interested in exploring or expanding nutraceutical sales. But if your warehouse is looking to take advantage of this lucrative market, here is how your warehouse can setup an effective nutraceutical fulfillment operation that grows revenue and ultimately stays ahead of rising.

Criteria for Successful Nutraceutical Fulfillment Warehouses

Nutraceutical fulfillment warehouses have unique requirements mandated by FDA regulations and by nutraceutical suppliers. The best way for 3PL warehouses to comply with these regulations is to have a comprehensive inventory management software to meet nutraceutical warehouse needs. To follow best practices, we recommend that warehouse managers pick a warehouse management system (WMS) that meets these  criteria:

Real-time Inventory Traceability

3PLs who distribute and store nutraceuticals are required by the Food and Drug Administration (FDA) to track the source of inventory. Typically, they use custom lot naming conventions that indicate inventory sources. Tracking the expiration date of supplements and temperature of specific lot freezers for cold storage nutraceutical warehouses is crucial to handle a recall, to keep inventory fresh, and to dispose or return expired inventory. Consequently, nutraceutical warehouses should adopt warehouse management software with real-time inventory traceability. This way, warehouse staff can track lot numbers, expiration dates, and temperatures of cold-storage locations quickly and easily. Having the ability to report on where products are located, how many orders have been sold, and maintaining correct inventory counts will help a warehouse avoid expensive fines for violating FDA regulations.

Assembly & Kitting Capabilities

Many nutraceuticals are purchased using a subscription service. In most cases, these will need to be packaged or assembled in kits that require warehouses to combine inventory and account for assembled units within an inventory tracking system. A WMS with inventory management capabilities should enable staff to combine inventory units, such as dietary pill packages or facial cleansers kits, in a warehouse and efficiently track them in real-time. 3PL Warehouse Manager, which has an assembly module that enables warehouse operators to easily track assembly and kitting, can easily help keep inventory in check to improve efficiency

Flexible Shopping Cart Connectivity

As mentioned, consumers order nutraceutical products through subscription services using a wide variety of online shopping carts such as Shopify, Amazon, and others. It is essential for an inventory management system to integrate with multiple order sources to meet supplier needs. According to 3PL Central’s Ecommerce State of the Third-Party Industry Report, online orders are up 80% in North America. Nutraceuticals comprise a significant portion of this online demand and more supply chains are looking to digitize operations to reduce risk from a second wave of COVID-19.

Streamlined Pick & Pack

Given the rapid growth in online nutraceutical orders, 3PLs investing in nutraceutical warehousing must be able to handle high volume fulfillment. Without the right technology to automate nutraceutical order workflows such as picking and packing, time management and efficiency can be a nightmare to when using manual order entry. Shipping automation tools are also important to automate package labeling. The ability to print up to 1,000 labels in a single print job, accelerating 3PL shipping processes is key when looking to meet surge order demands.

Final Tips for Aspiring Nutraceutical 3PLs

At 3PL Central, we have seen that warehouses who adopt warehouse management software with real-time inventory management traceability, assembly and kitting capabilities, shopping cart connectivity, and streamlined pick and pack grow rapidly and become industry leaders. One great example of a client who succeeded in the health and beauty nutraceutical fulfillment space is Brilliant Fulfillment. Brilliant won the Supply & Demand Chain Executive Top 100 Award for their rapid 10X growth and technological innovation. This warehouse used 3PL Warehouse Manager to setup their fulfillment operation. If 3PLs like Brilliant can thrive in nutraceutical fulfillment by applying these best practices, your warehouse can too. To see a demo of 3PL Warehouse Manager, click here.


Nathan Schlaffer

Written by Nathan Schlaffer

Nathan is an experienced SaaS product marketing manager who is passionate about creating compelling product messaging. Working closely with product, marketing, and sales teams, he is responsible for crafting effective product strategies and content to share the benefits and features of 3PL Central's solutions for third-party logistics warehouses. Previously, he has shared technology solutions with state DOTs such as the New Jersey Turnpike Authority and wireless solutions for warehouse AGV manufacturers.