3 Critical Considerations to Help Choose the Right Third-Party Logistics (3PL) Partner
Operating in an increasingly competitive business environment is a challenge for most organizations, and it is especially the case in the logistics segment. Businesses are continually looking at how they can make deliveries to clients on time and in good condition. However, while an in-house department can help the organization in this regard, you can only remain competitive if you focus on what you do best, which is production. A strategic approach is to hire a third-party logistics (3PL) provider whose specialty is in logistics. That said, there are specific considerations you must make during your search for a third-party logistics firm.
Multi-Departmental Evaluation Team
One of the many mistakes that most organizations make when evaluating potential third-party logistics partners is involving a handful of related departments. For instance, the primary player is usually the logistics department, and the office might get a little bit of help from the purchasing and sales department, and that's it. While the three departments might be directly involved in product deliveries and receipt, it is vital to understand that the supply chain in various industries has evolved significantly. Therefore, finding out the right third-party logistics provider needs input from other departments, not just the three. In addition to sales, purchasing and logistics departments, ensure that you also include the IT and finance divisions in the evaluation team. The approach provides a corporate-wide buy-in for the service provider of choice.
Another critical consideration you must observe when selecting a third-party logistics provider is scalability. Can the firm scale its operations to meet your growing demands? Most businesses fail here and end up hiring a company that does not match the changing needs. Thus, as you strive to find the right 3PL partner, remember that bi-directional scalability impacts the efficiency of your supply chain directly. For example, inasmuch as you want your business to grow, the fact remains that you will experience ups and downs in demand. Consequently, you need a 3PL partner that can scale down the processes when demand for your products fall and handle sudden demand spikes just as quickly.
Today's customer is continually evolving, as is the demand for an omnichannel experience. While omnichannel has become standard practice in the retail industry, many brands are still struggling to deliver the experience. The state of affairs can be attributed to the many moving parts involved. However, if you consider that brands that have robust omnichannel strategies retain 89% of their customers, then you begin to understand the value. Hiring a 3PL with omnichannel expertise should be a priority since the service providers are well versed in various aspects of the supply chain. Besides, such expertise ensures a seamless operation between the multiple channels which benefits your customers.