When is It Time to Work with a Logistics Provider?
March 4, 2020
How to Choose Between Intermodal and Truckload for Your Shipments
March 17, 2020How Outsourcing Transportation Management Will Improve Your Logistics Operation
How can outsourcing to a third-party logistics provider (3PL) keep your company moving in the right direction? Optimizing your transportation operations is more than just getting the best freight price. There are many factors that it will improve your business and streamline your processes.
Put Your Focus Elsewhere
When you outsource your logistics operations, you get access to knowledgeable and experienced professionals with expertise in modes, carriers, regulations, and more. You no longer need to spend time and resources trying to manage it. Your focus can be put on production, marketing, establishing customer relationships, and development. You can focus on building and running your business instead of shipping.
Reduce Overall Costs
If you are worried that outsourcing is more expensive than handling logistics in house, there is no need. A third-party logistics provider can lower your overall costs. A good 3PL has expertise in all aspects of logistics planning, capacity sourcing, and rate reduction through negotiation with the carriers.
A 3PL provider can leverage analytics and reporting to understand drivers of transportation spend to be able to spend smarter. By outsourcing your business, you will save in personnel, software and equipment costs.
Negotiations
As a single shipper, you do not have the leverage to negotiate with carriers. Whereas a 3PL provider can negotiate rates, but also understands the market and the fluctuations. Knowledge of the market fluctuations, freight pricing, carrier qualifications and technology are merely some ways a 3PL can leverage their own scale or volume to ensure greater benefits for you
Advanced Technology
When working with a third-party logistics provider, you will also have access to more extensive technology and logistics operations infrastructure. The Transportation Management System (TMS) is a single-source software solution for your company’s logistics needs. The TMS system provides real time tracking, document printing, and the monitoring of key performance indicators (KPIs) through customizable reporting and more. It is a system that top 3PL providers can offer to their clients at no charge because it only makes your life easier but it’s how they organize everything as well.
Improvement in Customer Service
Every business’ focuses on giving the best customer service that they can. This applies to your business, as well. No matter what you are shipping you need it to arrive on time and in excellent condition. This is where a third–party logistics provider will shine. They are able to calculate the best way to ship whether it is FTL, LTL, expedited, intermodal or anything else.
A 3PL will build and execute a strategy to help overcome the challenges of delivery speed, information flow, visibility, and delivery accuracy. This can also expand to reporting and analytics for use in tools like vendor performance scorecards and other forms of monitoring KPIs.
Do Your Due Diligence
It is important before outsourcing your transportation management to a logistics provider that you do your research. You want a third-party logistics provider that can deliver quality, value, and excellent customer service. It is critical that they provide a Transportation Management System so that you can provide documents and monitor your shipments in the most efficient way possible. Be sure to verify that they have a long history of providing excellent solutions to businesses. When you find the right provider for your business, it will raise your customer satisfaction, drive higher profit margins, and fuel the growth of your business.