5 Reasons to Outsource to a 3PL
Today’s economy is one that is extremely competitive. Companies are required to provide the best of services to make their customers satisfied. Companies need to strive to perform their best in all aspects of the business including customer demands, resources, competitors, time and cost. To be able to compete in this fast growing market, companies need to gain a competitive edge over all their competitors. Third-party Logistics (3PLs) have been on the rise lately providing services to logistics businesses that can help them advance in the market. Currently, 3PLs account for a good $150 billion business within the US and is expected to grow increasingly in the other countries as well.
3PL providers provide services in streamlining warehousing, operations and transportation which can be scaled according to the customer requirements and market demands. Outsourcing logistics services to a 3PL can greatly help a business in the following ways:
- Flexibility and scalability: As mentioned earlier, 3PL providers can scale up and down — labor, space, and even transportation, to meet your inventory requirements. Transitions are handled smoothly, with no need to worry about low and high seasons. A business may face intense variations in needs as the company grows. This in turn leads to an increase in costs and is time-consuming. With 3PLs, there is no issue of scaling up space, as it’s just a phone call away.
- Valuable expertise readily available: 3PLs have a good amount of knowledge about the logistics industry which you can take advantage of. To provide a competitive edge to logistics businesses, 3PLs have the full knowledge of all the new technologies and developments. 3PLs also have advanced software systems that can provide you with critical details about your business and provide reports on inventory management, thus providing visibility of the whole logistics process.
- Wide variety of resources: 3PL providers continuously refine and broaden their resource networks which in turn maximizes the efficiency. These provide a great deal of advantage over the supply chains that are performed in-house. This leads to lower overhead and thus provides the fastest possible service. Moreover, connecting with a 3PL can help you make use of the data from your supply chains to provide you critical information about areas of improvement and process management.
- Saves money and time: If you outsource to a 3PL, you will save money on warehousing space, staff needed to perform the logistics processes and transportation. Outsourcing can help you increase your savings consistently over the years. Moreover, you wouldn’t have to invest in latest technologies in order to support the logistics processes as this will be covered by 3PLs as well.
- Security is always in place: It is the responsibility of 3PLs to be fully updated when it comes to security regulations such as the C-TPAT, Customs and FTC Regulations and ISO. Furthermore, 3PLs also manage the carrier contracts, the safety ratings by DOT and insurance. Thus, you can always be assured that your products will be delivered in the most secure way possible. 3PLs manage every aspect of supply chains technologies.
Thus, by outsourcing your logistics needs to a 3PL, your company will be able to focus on more important issues such as your core competencies while being assured that your needs are being looked after by professionals.