For many companies, selecting their third-party logistics company is a difficult decision. But selecting the wrong company could be catastrophic. The top 3pl companies are all quite similar but they are all different. We explore why it is so important to get this decision right and what to look out for if you are thinking about outsourcing.
What is 3PL?
Third-party logistics (3PL) is a term used to describe a service that moves your products from one location to another. The service can be provided by either a company you hire directly or through an independent company that specializes in moving goods from one place to another.
We at gofreighthub are a professional third-party logistics provider (3PL) that can handle several aspects of your supply chain, including warehousing, transportation, and customer service.
What is the risk involved in using 3PL?
There are certain risks involved when using third-party logistics (3PL) services. The following are some of the most common risks and how to mitigate them.
Loss or damage of goods in transit: – A third-party supplier may have poor management practices and unknowingly damage your products during shipping.
Failing to meet customer requirements: – A third-party supplier may not be able to provide the same level of service as you would, since they are not familiar with your company’s processes and procedures. If they do not meet customer requirements, they could lose business and reputation.
Delivery delays: – A third-party supplier may also experience delays in deliveries due to poor management practices or lack of resources, which could result in loss of business and reputation for your company.
Inability to track shipments: – If there is no clear communication between you and your 3PL provider regarding how quickly shipments should arrive at their destination, then it becomes difficult for both parties to determine if there are any problems with deliveries or if shipments were lost along the way
Inaccurate shipping data: This can include inaccurate weights, incomplete tracking numbers, and other errors that could cause delays or extra costs when shipping your products from one location to another.
Inventory management:- Your inventory could be at risk if your 3PL doesn’t understand your business or isn’t properly trained on how to handle it properly.
What are the things that a company should consider when choosing the right 3PL?
There are many factors that a company should consider when choosing the right 3PL. Below is a list of some of the most important factors:
Cost: Do not overlook this factor when comparing 3PLs. You want to choose a company that will offer you the best value for your dollar. Be sure to look at all the costs associated with your chosen 3PL and compare them against other quotes.
Service levels:- You want to choose a vendor that can meet your service level requirements, whether it be 24/7 or just regular business hours up until 6 p.m., etc.
Experience and expertise: You want to work with an experienced 3PL who knows how to handle shipments like yours and has been doing so for years, as opposed to someone new on the scene who may not have all their ducks in a row yet!
Technology platform: Do not ignore this aspect either! Make sure the platform used by your chosen 3PL is robust enough to handle all the traffic coming through its doors and has features such as real-time visibility into shipment statuses or pick-by-voice capabilities (so you don’t have to sit there calling around asking if “my stuff” has arrived yet!)