If you’re considering moving product off site into a 3rd-party cold storage facility, your business
is approaching a new milestone. Your sales are on the rise, pushing the limits of your onsite
storage and taking you to the next level with higher-volume distribution, improved regional
reach, and more efficient logistics.
But any transition in distribution — particularly one that requires shifting large blocks of
inventory — needs careful planning, production alignment, and coordination with internal and
external teams to avoid costly delays, stockouts, and customer service issues while maximizing
profitability. Understanding the steps involved before you start allows you to set expectations,
prepare your teams, and prevent surprises once product starts moving.
Below is a detailed timeline of what to expect as you prepare to launch products with a 3PL cold
storage partner and how to keep your program running smoothly once operations begin.
Before you begin, make sure the 3rd-party Logistics (3PL) model is right for your business.
Although though many 3PL cold storage programs have a variety of SKUs and may ship less than
full truckload (LTL), the best candidates for this model often have one or two SKUs with high
order volume that ship full truckload (FTL). Having high-performing SKUs is a key
indicator that transitioning to offsite storage will truly improve distribution efficiency.
Businesses that ship less than full truckload (LTL) should carefully evaluate their contracts,
comparing their projected costs against projected profits to make sure that moving to a 3PL
model will be worth the increased complexity.
Your first step is selecting the facility that best fits your needs in the most advantageous
geographic region. Start by mapping your customers’ distribution center locations in your highest-demand markets, avoiding high-traffic zones, challenging terrain, and other areas that
may complicate deliveries.
Positioning your inventory closer to these locations makes everything move more efficiently.
Lead times shrink, delivery speeds improve, and freight costs drop because you’re no longer
relying on long, partial-load hauls. This proximity also allows customers to order more
frequently without risking stockouts and gives you the agility to respond quickly when demand
changes.
Analyze your business model and determine whether you need deep racking for bulk storage or
select racking for distribution storage and whether your products require a refrigerated
warehouse, frozen storage, or a climate-controlled warehouse. Also decide how many pallets
you plan to store off site, so you will know whether you need to partner with a smaller facility or
a massive hub.
Conduct research on the internet or call to find out which facilities in your selected areas match
your needs, bearing in mind that any mismatches will decrease efficiency and increase cost.
Provide the facilities with the information they need to give you an accurate bid that you can
compare their bid directly with bids from other facilities. Make sure they have an accurate
picture of the factors that have the biggest influence on pricing, such as how many pallets you
will be storing, your order patterns, typical turnaround times, and seasonality.
Once you have asked your questions, completed vendor questionnaires, and obtained multiple
bids, you will need to compare the bids to determine which one offers the best balance of cost
and value. Give yourself 1–2 weeks for internal decision-making.
After selecting your partner, you’ll need to create an account, which includes exchanging
documents, setting up items in their warehouse management system (WMS), integrating
EDI/APIs, and establishing credit, which typically takes 3-5 days. If your industry requires strict
compliance with regulations, you will need to include time for documentation preparation and
audit readiness. And be sure to account for transportation lead time + the number of days out
the facility is booking loads, which may add up to a week.
Many companies significantly underestimate the time and resources required for ramping up
and find themselves without the inventory they need. To launch successfully, you must build
enough inventory to meet both emergency stock and expected order volume requirements.
Emergency stock is the bare minimum inventory that you need to have on hand. Most programs
require companies to always carry 21–45 days of projected sales per consignee. To avoid
depleting your emergency stock, you must also produce enough product to fulfill your expected
order volume during this same period.
Many organizations run lean on inventory when using onsite cold storage because they can
quickly ramp production when needed to fill in any gaps, but this flexibility disappears when
inventory is stored remotely. If you don’t have proper emergency stock at the 3PL site, it can
take days to replenish, which can lead to stockouts, fines, and/or rush charges.
Generating overstock will likely require producing significantly more than your normal output
for several weeks. You will need to be realistic about how long this additional production will
take. If production capacity is tight, adding weekend or evening shifts can help generate the
required overstock more quickly.
Most manufacturers in 3PL programs follow a 2–6 week turnaround from when products arrive
to when they ship out of the facility. If your turn is significantly longer or shorter than that, you will need to call this out to your facility. Managers need to plan and staff for shorter turnaround
times or increase storage costs for inventory with longer turnaround times.
While your production team is building inventory, your managers should familiarize themselves
with inventory terms and best practices.
They should work on:
Receiving and shipping operate on different timelines, and each has a direct impact on your
ability to reliably serve your customers.
Inbound inventory is never ready to ship immediately on arrival. There is a process to
confirming it that generally takes 5-12 hours depending on what time the load arrives and the
facility’s hours of operation.
Outbound inventory has two parts: physical release and custodial release. Every cold storage
facility manages its dock schedule differently. Some have only a day or two lead time, while
others may schedule four to seven days in advance. Knowing how far ahead the schedule fills is
essential for planning outbound orders.
You’ll also need to clarify custodial release requirements, which authorize the facility to pick and
ship your product. Most 3PLs require these releases at least 24 hours prior to shipping so they
can pick the order the day before. This combination of physical release dock scheduling and
custodial release timing needs to be built directly into your order cadence to avoid missing
appointments, delaying shipments, and disappointing your customers. If your team understands
this timeline, they can set your orders up for shipping success.
Once you begin outbound shipments, make sure your paperwork and reconciliation are
performed regularly and in a timely manner. You should expect a signed bill of lading (BOL) from
the cold storage facility shortly after each load, typically within 2-4 hours of the driver signing
out. Signed BOLs verify exactly what left the building, so never bill without them.
Make sure to reconcile what shipped against your internal inventory and the original purchase
order. Quantities can change between PO creation and actual shipment due to low inventory,
case damage, or other factors. Establishing a reliable review process ensures accurate billing,
clean inventory records, and better transparency with fewer surprises for your customers.
Moving product into a 3rd-party cold storage facility is a milestone for high-growth companies,
and you can help set your company up for success by improving efficiency in your cold chain and
choosing the right partner.
With more than 50 years of cold-chain experience and strategically located facilities across the
Midwest, Interstate Cold Storage has a proven record as one of North America’s top public cold
storage providers.
Each of our facilities was built from the ground up for efficiency, with state-of-the-art racking,
wide aisles, multi-temperature zones, and a modern WMS that supports real-time visibility,
precise inventory control, and seamless integration with your internal systems. Our family-
owned business values its employees, which is why we have a veteran team known for accuracy,
communication, and attention to detail, which are critical advantages when you’re coordinating inbound loads, managing emergency stock levels, and meeting strict retail shipping
requirements.
Most importantly, our simplified processes, consistent dock scheduling, and fast return of
signed BOLs keep your orders moving efficiently and on time. Whether you’re growing into
regional distribution or preparing for national scale, ICS delivers the reliability, transparency, and
partnership needed for a successful 3PL cold-storage launch.
Want to find out how Interstate Cold Storage’s 50+ years of experience can help set your 3PL launch up for success? Contact us today.
