5 Advantages a Third-Party Logistics Partner Can Provide
Working with a third-party logistics provider creates unique advantages for your logistics operations. As an extension of your business, 3PLs are able to provide critical services that enable you to focus on your company’s core competencies. While there are many advantages that come with partnering with a 3PL, below we have outlined five of the main advantages below. Cost Savings A 3PL service provider works to find the quickest, cheapest, and the most efficient way to move freight. Utilizing their vast network of carriers and resources, 3PL providers can procure lower rates and efficiently provide a company with logistics plans. In-house logistics operations can be costly, partnering with a 3PL that already has dedicated resources can help you cut costs. Technology By partnering with a 3PL, you are able to take advantage of cutting-edge transportation management systems (TMS). Having a tailored TMS can increase visibility, data analysis, and aid in process improvement. Most third-party providers have a focus on technology, constantly working on improvements to stay competitive in the expanding market. The ability to constantly make investments in technology might be out of reach some businesses. Innovation Due to competition and high standards, 3PLs are investing large amounts of capital into innovative solutions. Expectations are continuing to grow when it comes to reporting, tracking, and logistics management. Staying on the forefront with cutting-edge technology to handle those expectations can consume your resources fast. Flexibility The expertise and abilities that a 3PL provides, allows companies to efficiently handle busy seasons and the unexpected without worry. The scalability of a 3PL allows companies to also be more flexible in their operations, processes, and procedures. As a result, flexible solutions can enable your business to grow in new directions with the knowledge that your logistics solutions will grow too. Risk Management Outsourcing the logistics process partially transfers the risk of freight movement to the 3PL provider. While materials move through the logistics operation, your third-party provider takes on the responsibility to deliver freight on time and in good condition. Also, working with a 3PL provider reduces your company’s finical risk of an investment in property, equipment, and transportation assets.