Focus on KPIs that drive cost-to-serve and customer experience: inventory accuracy, order cycle time, on-time-in-full (OTIF), cost per pick/pack, return processing time, and chargeback incidence. Require transparent reporting cadence and thresholds tied to service credits to align incentives.

Closer proximity reduces mileage-driven carrier zones and fuel surcharges, shortens transit times for LTL and parcel lanes, and enables same/next-day delivery options. It lowers dwell and dray costs for multimodal moves and supports more efficient replenishment and lower safety-stock requirements.

Require a modern WMS with real-time inventory, audit trails, and slotting rules; API-based integrations or EDI with your ecommerce/TMS platforms; carrier manifesting and label automation; barcode/RFID scanning and basic automation for scalable throughput and accurate SLA measurement.

Negotiate transparent rate tables, clear minimums and throughput tiers, detailed SLA definitions with service credits, inventory ownership and liability clauses, termination and transition terms, seasonal capacity options, and limits on pass-through accessorials to avoid unexpected charges.