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How to choose a 3PL provider for your business

The right third party logistics (3PL) provider can be a game changer for your business, whether you’re outsourcing logistics for the first time or unhappy with the level of service your current 3PL vendor is offering. From warehousing and fulfillment services to air freight, fleet management and/or distribution services, a 3PL provider can provide solutions that can free you up to focus on your core business, and optimize your processes for greatest success.

When looking for a new 3PL vendor, there are a number of factors to consider, including pricing that offers good value. Of course, while cost is a factor, the consequences of cutting corners in the supply chain can be catastrophic, if it means disappointing customers and losing ground to your competition. As you review the offerings of potential 3PL companies, here are some areas of focus you may wish to consider, in addition to pricing.

Customer service is key

Good 3PL companies should be able to provide solutions that streamline your supply chain and keep things moving smoothly. However, it’s never been clearer that real world situations can impact the stability of your supply chain. Peace of mind comes from knowing that your 3PL provider is prepared to deal with potential problems, with customer service that understands your business and is contactable 24/7.

Consider 3PL customization capabilities

In fields where specialization is the norm, a vendor with a “one size fits all” approach may not be in your best interest. Agile 3PL companies should seek to customize their offerings to fit your unique business needs. The benefits of customization far outlast any initial setup considerations. Ask potential providers how they will customize their 3PL service to give you made-to-measure results. A trustworthy vendor should be eager to learn everything they can about your business, so that your 3PL logistics solution is tailored to business needs.

Seek out omnichannel expertise

For businesses with multiple distribution channels, a 3PL vendor with omnichannel distribution and fulfillment expertise is a must. But even if your business typically utilizes a single route to market, it’s worth considering how the landscape will evolve in the coming years. Customer expectations have changed a lot in recent years, and agile businesses need agile partners in order to remain competitive. Omnichannel expertise is part of the big picture for most these days.

Pick a 3PL company who can handle scalability

Growth is likely among your business goals, and a scalable supply chain is critical to managing increases in volume of product or raw materials. An experienced 3PL partner should be able to support growth with services that smoothly scale, whether the growth is planned or the result of an unexpected surge in business. Ask for examples of times when a potential logistics partner has been able to move quickly to support a client by helping scale their business, whether proactively or reactively. A partner who can’t demonstrate scalability may not be able to handle your future business needs.

Don’t risk your reputation over 3PL. Expect stability.

In business, a good reputation is hard earned and easily lost. A good 3PL provider should be able to free you up from day to day logistics hassles so you can focus on your core competencies and do more of what you do best. But if you place your trust in a 3PL partner, you want to know that they’ve earned their own reputation for trustworthiness and stability. References matter. Look for references based on long-term client-vendor relationships.

Use the opportunity for a 3PL technology upgrade

Today’s logistic landscape is driven by technology that delivers state-of-the-art tracking and transparency, driving efficiency and enabling flexibility. Whether you’re looking for a 3PL partner for the first time, or moving on from a bad vendor relationship, the technology your logistics partner utilizes should have a net positive impact on your business. Can your potential vendor smoothly transition your business to the latest technology tools? Does their technology support a secure chain of custody for your goods? Do they have the IT resources to troubleshoot problems?

Expect a culture of continuous improvement

The benefits of today’s 3PL technology include the ability to fuel a culture of continuous improvement. Increased visibility into your supply chain, plus the knowledge base that an experienced vendor can tap into should create opportunities to optimize your business logistics on an ongoing basis. Ask for examples of when a vendor has been able to drive long term value for a client by continually offering insights and improving processes.

Seek solutions that are more than the sum of their parts

From state-of-the-art technology to the human touch that comes with excellent customer service, there are many factors at play when seeking out a 3PL company that can deliver peace of mind and take your business to the next level.

It’s useful to consider each facet in isolation, and expect any prospective vendor to have a robust POV on their capabilities when measured against scalability, omnichannel expertise and so on. Of course, the real magic happens when key 3PL factors work together in concert.

 

At Expak, we view our capabilities as parts of a greater whole, operating with continuity so that smart processes generate data, which allows us to analyze partner businesses and apply a mindset of continuous improvement. We take a “no shortcuts” approach, from onboarding through high-touch customer service to the proactive approach we take to processes. As you ask the right questions in your search for a 3PL company, we hope you’ll spend time on each of the building blocks for 3PL success, and take the big picture into account.

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