How long should 3PLs and distributors keep order and shipping records?

The short answer: by record class, set by the longest driver#

3PLs and distributors should keep order and shipping records for the longest period any applicable driver requires for that record class. The drivers are tax and audit rules, customs and product traceability duties, customer and client contracts, carrier and customer claim windows, and litigation or audit holds.

Because these drivers differ by record class, one company-wide number either keeps too much or too little. Sales orders, inventory adjustments and raw EDI files face different pressures, and they live in different systems with different deletion settings.

A few federal floors are worth knowing. The IRS says to keep records supporting income and deductions until the period of limitations runs out, generally three years, six years if unreported income exceeds 25% of the gross income shown, and seven years for a bad debt deduction. DOL Fact Sheet #21 says employers must preserve sales and purchase records for at least three years. Contracts and claims often push periods past these minimums.

The periods themselves come from counsel, accountants and contracts. The operational work, covered below, is mapping record classes, finding where each is deleted and making the systems follow the schedule.

Retention by record class#

Retention by record class starts with a table like the one below, with one row per class, the systems that hold it, the drivers that set its period and the mistake that most often loses it. Add a period column once counsel and the controller confirm each figure.

Two refinements apply to many operations. For food, beverage and other goods with traceability rules, lot and shipment records may carry extra requirements, so confirm them against the regulator's current guidance for your products. And for 3PLs, every class splits in two: records about the 3PL's own business, and records it processes for clients under their agreements.

Retention happens in system settings#

Retention happens in system settings, not in the policy binder. A schedule that says keep shipment history means little if the WMS purge job deletes transaction detail on a rolling basis or the EDI translator caps its log storage.

Check each setting against the schedule periodically and always after an upgrade, because upgrades and re-implementations can reset purge settings to defaults.

• 1WMS: transaction history, pallet and license plate history and task logs often have purge or archive jobs set at go-live.
• 2ERP: closed orders and invoices may be archived or summarized during upgrades and migrations.
• 3TMS and imaging: document retention may depend on the plan or storage tier.
• 4EDI: translators and VANs may keep raw interchanges, acknowledgments and mailbox history for limited windows.
• 5Email: mailbox retention policies can delete exception threads that were never filed to a shipment.
• 6Carrier and retailer portals: history may be available only for a limited window, so download what the schedule requires.

Inventory adjustments and EDI logs are purged first#

Inventory adjustments and EDI logs are the record classes most often lost, because they are bulky and rarely opened until something goes wrong. Both matter when it does.

Inventory adjustments, with reason codes, user IDs and cycle count results, answer client questions about shrink, support audits of inventory valuation and show how discrepancies were investigated and resolved. Keeping only the current on-hand balance erases that trail.

EDI history matters in disputes. A raw 856 ASN shows what was announced and when, and the 997 functional acknowledgment shows the partner received it. When a retailer fines a late or inaccurate ASN, the raw interchange is often the only proof, so keep raw files beside translated data for as long as trading partner agreements and dispute history suggest.

Illustrative: a distributor with a contract warehousing arm#

Illustrative: a fictional industrial distributor runs an Infor ERP for its distribution business and a separate WMS for a contract warehousing division that stores goods for outside clients. A client audit request exposes gaps, and the COO orders a review.

The review finds the WMS purging inventory transaction history on a short rolling window set at go-live, raw EDI files kept only as long as the translator's storage allows, and POD images from before an imaging upgrade stored without PRO numbers. Each warehousing client agreement also sets its own record terms.

The COO adopts a schedule by record class with periods confirmed by counsel and the controller, extends the WMS purge window, moves raw EDI to archive storage and tags client records by contract so each client's terms apply. Older history beyond the schedule is queued for a documented decision rather than left in place.

What to do when a retention period ends#

When a retention period ends, the record needs a deliberate decision: delete it, de-identify it, assess it, or return it to the client who owns it. Records kept past their period by accident add discovery exposure, breach exposure and storage cost without any benefit. Records kept on purpose, with a written reason, are a different matter.

How SourceX approaches retained logistics records#

SourceX treats a company's retention schedule as an input, not an obstacle. Records under a hold are excluded, records past their period are reviewed with counsel before they are considered, and 3PL client records follow each client agreement. For records a company keeps on purpose, the first stage of the SourceX five-step transaction is a fit check run on metadata alone, and the SourceX Enterprise Data Value Framework weighs drivers such as recency, data cleanliness, rights, preparation cost and privacy burden.