Third party logistics providers are placing greater emphasis than ever on technology while they continue to improve working relationships with their shipping partners, a recent US survey indicates.
According to the 21st Annual Third-Party Logistics Study, 75% of shippers said the use of 3PL services has contributed to overall logistics cost reductions, and 86% said it has contributed to improved customer service.
“Since the study began,” the report authors write, “researchers have seen the continued improvement in the strategic nature of relationships between shippers and third-party logistics providers.”
The continuing trend is for companies to seek value in 3PL integration by outsourcing transaction processes, operations processes and repetitive processes (warehouse management, freight-forwarding and other logistics functions), with information as the key factor in collaboration, whether that is open communication to solve problems or simply data.
The 3PL sector is growing, reflecting the growing reliance on outsourced warehousing and shipping to meet customer demand without added cost, especially among small- and medium-sized businesses.
Smaller companies are increasingly looking for 3PL integration that will help with planning and coordinating those services. This means finding a partner that understands your business and a partner that accommodates your technological needs, including the need to track inventory much in the way that warehouse management software does.
The logistics world has evolved to such a degree that many 3PLs aren’t only adding on a wide variety of services, but also specialise in particular sectors, such as fashion and food. Experts in the field are saying the generalist approach simply won’t do these days.
It will be important if you’re looking for a 3PL that you find one that understands your business. Working with 3PLs that do not know your products or your product sector may not understand things like chargebacks, for instance, and that will cost you money and time.
And look for 3PLs that accommodate the technology that lets you manage inventory from your office. Integration between your inventory management software and your 3PL providers means you get the same level of stock transparency as if you’re running your own warehouse, without the costs or risks.
Click to see how Cin7 connects inventory management with integrated 3PL providers.
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