Today, computer software programs and automation have vastly increased the ability of companies to obtain efficient, cost-effective shipping logistics. If your firm markets beverages, consumer goods, foodstuffs, retail merchandise, pulp and paper products, or chemicals through the bustling Port of Savannah, you may find some attractive cost-cutting capabilities by retaining the services of a 3PL company. Sometimes also referred to as a “TPL” (an abbreviation for the expression “third party logistics” enterprise), modern 3PL businesses help their clients save time and money. Logistics Savannah and other ports can benefit from companies like PortCity.
This brief article will consider a few of the benefits of utilizing a 3PL provider. Will this process enable your business to enhance its bottom line? What criteria should you employ in selecting a 3PL? Correctly answering to these questions could translate in potential cost savings for your enterprise.
An Overview of 3PL Service
Decades ago, many manufacturers handled all their shipping and product distribution functions as a subset of enterprise operations. They typically maintained full-time shipping department personnel to handle the steps involved in sending orders to customers. Most shipping department personnel functioned at the mercy of carrier facilities; for example, products might ship from the plant on a Tuesdays and Thursdays if train schedules dictated local freight stops on those days.
The advent of more channels of distribution and ultra-fast computers transformed the shipping landscape. Today, more carriers compete for customer business. Additionally, very powerful computers allows people shipping freight to calculate the most cost-effective routes with precision. These circumstances contributed to the growth of 3PL providers, firms specializing in helping their customers ship products using the most cost-effective, efficient means possible.
Potential Benefits of Using a 3PL Provider
By outsourcing all (or part) of a company supply chain to a qualified 3PL firm, some manufacturers have succeeded in trimming operating costs and expediting product delivery times. These benefits translate into improved revenues. The responsible 3PL firm implements systems for tracking shipments accurately through every stage of the fulfillment process. These providers invest in specialized technology and highly trained logistical expertise in order to help their clients save money. This outsourcing process enables a manufacturer to focus on its production mission, and allow the 3PL firm to concentrate on achieving fast, cost-effective delivery.
What types of investments might a 3PL enterprise make to further its core areas of expertise? Third party logistics specialists often maintain modern, sophisticated warehouses with Internet-connected forklifts and advanced logistical software programs. The high cost of this capital investment would overwhelm some manufacturing enterprises; yet they can utilize the same rapid product-shipping tools as much larger companies by retaining the services of a 3PL. To some extent, the rise of the 3PL industry has enabled startup manufacturing firms to serve their customers with the same powerful automation systems harnessed by much larger competitors. The benefits of using this form of shipping include:
- Faster product delivery times
- Seamless inventory tracking throughout the shipping process;
- Enhanced capabilities to obtain the most economical shipping rates and distribution routes;
- Savings on shipping department overhead and personnel salaries;
- Improved customer service;
- Leaner, more cost-effective shipping procedures.
- Choosing the Right 3PL Firm
How should your company select a 3PL provider? Many factors ultimately enter into this decision. Most experts recommend thoroughly surveying and analyzing your current shipping needs and costs as a prudent first step in choosing a third party shipping firm.(1)
By undertaking this assessment, you’ll find yourself better able to evaluate the potential cost savings involved. Conducting an audit of your shipping department and freight accounting may prove helpful in obtaining a reliable database of information, for instance. Ultimately, a 3PL service should furnish distinct benefits in terms of improved, streamlined shipping and tangible cost savings. Consider using 3PL providers who can document successful records of achievement in these areas. Talk to port logistics expert Savannah- Port City today to see how we can streamline your shipping!
1.http://www.supplychain247.com/article/13_key_considerations_when_selecting_a_3pl_3pl_vs_4pl/cerasis