3PL Management Strategies

Whether you are a rapidly expanding business, diversifying into e-commerce, or looking to increase capacity, your logistics strategy is going to be key. A Third-Party logistics provider (3PL) could be a good solution. Perhaps you already have a 3PL working with you and you are simply wanting to improve the working relationship, operational requirements or renegotiate contracts. Whatever your reasons or requirements our experienced team can help.

Third-Party Logistics.

At Sigma we believe that a Third-Party logistics provider can be a great solution. Whether to meet demands within your supply chain or allow the business to focus on its core competencies and proposition. It is also true that at some point in time every business benefits from having additional support. But these are big decisions to make, not only in deciding if a 3PL is the right solution but then also the selection process, establishing your operational requirements, defining KPI’s / SLA’s etc. If you are considering engaging or renegotiating existing contracts that’s where our experienced team can help you.

Third-Party Logistics providers can be a great solution.

Whether considering, recruiting, or redefining your requirements with your third-party logistics (3PL) provider we can help you:

♦   Clearly defining your requirements to ensure that your 3PL solutions meet your current and futures business needs.

♦  Your recruitment / selection process.

♦  Ensuring that you are getting the required service and value need in the short, medium and long term.

♦  Contract renegotiation and redefining service requirements. 

Finding the right solution.

Over the years we have helped many businesses establish and build their operational relationships with their 3PL. What should be clear in all cases are the benefits and reasons for why you are using, or intend to use, a third-party logistics provider.

Selecting the right partner and establishing your relationship if key.

Dependent upon your operational setup,  specific needs and strategic goals, 3PL providers can offer a variety of benefits. Below are some of the key benefits that you should expect.

Experts in their field.

Your selected 3PL should be an expert in their particular field. Not only through their operational experience and practice but also in being able to provide an extensive network of resources and warehousing locations. This should simply translate very simply into actually saving you money and becoming more efficient in your supply chain.  A good 3PL provider should be proactive and able to identify any noticeable gaps in the supply chain with clear suggestions to resolve.

Saving you Time and Money.

Many organisations believe that they can save the most money by managing their supply chain needs internally. The reality is, whilst this may be true for some, for many it is just not the case.  Many would save more money and become more efficient by appointing a good 3PL provider.  A good 3PL’s role should be making their customer more efficient in terms of time and money. This can come from a variety of reasons, not having to spend money on building warehousing, hiring and managing labour, facilitating transportation, and installing various technologies. Some companies can reduce their costs drastically, while simultaneously freeing up more time to focus on core business initiatives. Saving money in the short term is obvious, however, this should always continue into the long term.

Business Expansion and Consolidation. 

Whether establishing a new distribution network, expanding existing networks or re-positioning / consolidating a 3PL will be an excellent solution. Establishing new networks is costly and resource hungry. Not having start-up costs for warehousing, equipment, and technology can be a huge saving. Providing the opportunity to strategically use funds and resources into improving their customer proposition and to better serve customers.

Speed and Flexibility.

Many Third-party logistic providers have a vast resource network available that provides advantages over in-house supply chains. With access to a 3PL provider network, supply chains can be expanded quickly, efficiently, and in a cost-effective manner. Opportunities exist for lower overhead costs, shared users sites and labour and the ability to quickly and cost-effectively scale space, labour, and transportation based on the business requirements. Whether it is the impact of seasonal trading, additional sites or coverage 3PLs can help provide adequate space and resources to meet your flexible demands.

Continuous Improvement.
Customer satisfaction is critical for all businesses in the long term and reputation is paramount, as is the case for all good 3Pl’s. Developing a good working relationship with your 3PL is essential. Having in place an open and transparent review process, KPI’s and SLA’s are the foundations of a good working relationship. By establishing a collaborative relationship with your 3PL and a well-communicated strategy for your business requirements, this should be met with an agreed continuous improvement strategy delivered through running costs, performance management, training and other supply chain and continuous improvement initiatives.

A Third-Party Logistics Provider is not the right solution for all businesses. However, if you are considering the option or simply understand more about how 3PL solutions as part of your due diligence process, we can help.

Give us a call to find out more about how we can help you.