Third-Party Logistics providers are shrinking in Numbers & are growing in Size.
The very definition of a 3PL today is in a flux. The lines between pure Service Provider and “value-added” providers are blurring. Many are offering intermodal service, arranging for the shipment of containers by rail over long distances, in addition to truck and ocean transport. Some entities operate their own trucks or warehouses, while others function as pure intermediaries between shippers and underlying asset providers.
As we would know there are many benefits of hiring a company to manage your logistics. Third-party logistics providers can have a significant impact on the growth of your business. A 3PL company will manage your product pick up, warehousing, distribution, and shipping schedules while keeping you informed along the lines. As a business owner you gain a knowledgeable partner that helps streamline your supply chain, stay on top of consumer demand, and increase your profits.
Many small businesses are hesitant to partner with a 3PL company; often thinking that they are too small to take one on. But the truth is that third-party logistics providers can help manage and grow your business—whether you have a large business with 3 locations or a small business starting out of your basement—there’s a 3PL management solution for you.
3 Main Benefits and Advantages of Using a Third-Party Logistics Provider
1) You gain access to larger resources.
3PL companies have a huge network of freight shipment resources at their disposal. They have relationships and partnerships in every point along the supply line. These resources allow 3PLs to group your warehouse space or shipments with other shipments heading to the same location. They also have access to volume discounts which enables your 3PL company to offer you better shipping rates than if you self-managed your shipments.
2) It saves you time and money.
You can save your business time, money, and a lot of headaches by employing a 3PL company to manage your product distribution. Volume discounts on shipping is one way to save, but shared warehousing facilities is another. When you use a third-party logistics provider, your business can move more products, more efficiently, and more safely. Additionally, your 3PL company will have the latest software and technology for reporting, tracking, monitoring, and securing your products.
3) You start a strategic business partnership.
Your 3PL provider works for you. They will look out for your best interests because when your business grows, so does theirs. Third-party logistics providers use logistics management software that finds inefficiencies along the supply lines that waste time and resources. 3PL companies are continuously improving and optimizing their services to reduce shipping times, save on expenses, and serve you and your business better.
One of the most important benefits of starting a 3PL partnership early on is the flexibility and scalability it offers you. It works well for seasonal businesses or other organisations with irregular product demands. 3PLs also allow you to quickly keep up with changing markets and growing consumer demands; your provider can increase your warehouse space and shipping frequencies easily without disrupting your distribution process.
For 10 years the landscape of third party logistics (3PL) has changed in major ways and is poised to grow and modify with emerging ‘smart’ working practices and mobile technologies. Competition is heating up to serve the increasing demand with up to 15 percent growth forecasted. Accurate and efficient 3PL processes geared to decrease costs while providing 24/7 services will be crucial for owners to adopt for future success. The costs-reduction goal of operational and employee hours will be attained by partnering with 3PLs for global supply chain services. Emerging technology adoption will be key to that goal’s success. The following 10 predictions for the next 5 years will become common within the majority of 3PL businesses by whose implementation shippers and supply chain managers will enjoy.
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