3PLs tighten shrinkage controls
Third‑party logistics providers are stepping up cycle counts, spot checks and surveillance to combat rising inventory shrinkage, signaling tighter ops at fulfillment centers. (x.com) Meanwhile, RJ Logistics says a visibility partnership with Rectangle has become a concrete sales differentiator, showing traceability improvements can directly win customers. (x.com)
A warehouse can look full and still be losing money one carton at a time. In third-party logistics, that gap between what the screen shows and what is actually on the shelf is called shrinkage, and many contracts still assume a “normal” loss allowance of 0.5% to 1% of inventory. (redstagfulfillment.com) That is why more logistics operators are tightening basic controls instead of waiting for the annual wall-to-wall count. Cycle counting means counting a small slice of inventory every day or week, so errors show up while the trail is still fresh and the warehouse does not have to shut down for a full recount. (cpcongroup.com) The method is simple but demanding. High-value “A” items get counted more often than slower, cheaper “C” items, and random spot checks are used to catch the bins and processes that look fine until they do not. (cpcongroup.com) The pressure behind this is not imaginary. The National Retail Federation said the average retail shrink rate rose to 1.6% in fiscal 2022, equal to $112.1 billion in losses, and warehouses that handle retail and e-commerce freight sit inside that same loss-prone flow of goods. (nrf.com) Once shrink starts rising, the damage spreads beyond the missing product. The Association for Supply Chain Management says poor inventory accuracy leads to back orders, dissatisfied customers, and higher costs, which is why warehouses pair counts with tighter scan discipline, camera coverage, and access controls. (ascm.org, prologis.com) The benchmark many operators chase is not perfection but trust. Yale’s distribution center metrics say best-in-class operations hit a 99.9% match between physical inventory and system records, which leaves very little room for “we think it’s somewhere in the building.” (yale.com) The other half of the story is outside the four walls. RJ Logistics, a Southfield, Michigan-based third-party logistics provider, said on April 8, 2026 that its cross-border freight business had become harder to track in Mexico because older tools that depend on driver opt-in or electronic logging device feeds were not giving customers timely updates. (dcvelocity.com) RJ’s fix was to connect with Rectangle, a Chicago logistics software company that pipes location data into RJ’s McLeod transportation management system. DC Velocity reported the setup was implemented in less than a day and now feeds live shipment locations directly into the system RJ’s staff already uses. (dcvelocity.com) Rectangle says the result was more than 95% tracking coverage, roughly 15-minute tracking intervals at the 95th percentile, and 20 times more tracking data points on cross-border loads. RJ also said manual “where is the truck” check calls fell by more than 70%, freeing work equal to two full-time employees. (rectanglehq.com, dcvelocity.com) That is why these two developments belong together. Inside the warehouse, tighter counts and surveillance are meant to stop inventory from disappearing; outside the warehouse, live traceability is meant to stop shipments from disappearing into phone calls, spreadsheets, and guesswork. (cpcongroup.com, rectanglehq.com) RJ told DC Velocity that the visibility upgrade is now helping it win business, not just run cleaner operations. In logistics, “control” is turning into a sales feature: if a provider can prove what is on the shelf and where the truck is, it can sell certainty in a market that has spent years running on exceptions. (dcvelocity.com)
