Third-Party Logistics Companies (3PLs) are becoming more popular as the retail landscape shifts from the physical store to the online store. Why do so many companies make the strategic decision to rely on outside partners for execution of transportation services? The benefits are vast. 3PLs can gain you access to better freight rates, improve efficiencies, cut costs, share knowledge and connections, provide technology, save time, and much more. Selecting the right third party logistics partner has never been more important. You may even be considering multiple 3PL partners to diversify between products/ services and mitigate risk associated with single-source providers.
What is third party logistics?
Third party logistics services support all aspects of shipping operations including warehousing, transportation, and supply chain procedures. 3PL’s tend to be experts in the functions of supply chain operations by finding efficient, cheaper, and simpler solutions for transportation and warehousing challenges.
Expert knowledge
Supply chain logistics can be complex; shipping, warehousing, fulfilment, all come with major challenges. When it comes to supply chain logistics, 3PL organizations are experts and can communicate clients with their experience and connections to quickly streamline processes. They are knowledgeable in matters such as transport documentation, import and export, international compliance, and economic regulations, for instance. This industry experience saves you time from worrying about your business’s daily operational problems and offers you more time to focus on your core business.
Save time and money
With the utilization of a 3PL you can eliminate the needs to invest in transportation, warehousing space, and the workforce required to execute the logistics chain and all the time it takes to research making these decisions. You also need not to worry and spend time on paperwork, billing, audits, staffing, and optimization. By partnering with a 3PL provider, you can focus more directly on your core business. They will likely have exclusive relationships within the logistics sector, greater influence during negotiations, and will also be able to offer greater volume discounts to clients. All of this can significantly reduce liabilities in labor, overhead and inventory through this shared investment.
Scalability flexibility
The key to a great customized supply chain is that it needs to be able to continuously fluctuate with market conditions. A 3PL provider can more efficiently scale warehouse space and labor up or down depending on what is happening in the market and for regular seasonal changes.
By utilizing a to 3PL operate your parts distribution center, all services are customized to fit your requirements, and the provider can manage all or any segment of your supply chain process from inventory management and ownership to fulfillment and customer service management.
Technology
The influence that technology has on the shipping industry will continue to grow as many companies adopt new technology to their business process’. As companies embrace these new technologies it brings about the challenges of how can they flow together seamlessly? 3PL’s make this a breeze by implementing all the integrations for you, plus they can provide greater visibility over your shipments so that you can more efficiently manage your distribution.
MVP Logistics is your 3PL logistics partner for supply chain project management, logistics, warehousing and fulfillment, LTL, and other supply chain needs. Our Minneapolis, Houston, and Los Angeles area warehouses provides local, national, and international shipping services. Find your solution today.
I like that you talked about how you could focus more directly on your core business by partnering with a 3PL provider. I was reading up about some business strategies the other day and I remember learning about 3PL logistics warehousing. It seems like a pretty convenient type of service for a business, so I could see why it is being used.
Really informative.