In today’s business world, logistics operations have moved from being about the simple loading/unloading of boxes to dealing with crises, challenges and understanding technology.
Inefficient business processes and a lack of operational visibility can have a major impact on logistics operations, both globally and locally. In addition, rising overhead costs, unpredictable capacities, increasing liabilities, security risks, and employees’ compliances issues exacerbate operational challenges. Businesses need to keep an eye on these challenges at all times and be prepared with plans to either mitigate or absorb them. To do this successfully requires a significant investment in logistics infrastructure, technology and processes. A 3PL provider, on other hand, manages these operational challenges on a daily basis and is ready and available to provide scalable solutions that ebb and flow with changing market conditions.
Read on to learn how you can kill 7 top operational challenges with the assistance of a 3PL.
1) Lack of visibility
Many 3PL companies find success when they provide good customer service and visibility into their customers’ supply chain at same time. Visibility in to your logistics chain assists in identifying gaps and inefficiencies that can cause disruptions in your operations. Visibility should allow the operations team to know of potential disruptions in advance so operations are not highly impacted. In order to attain operations alignment, the challenge is to bring visibility and control over the entire logistics network. To deliver this, 3PL providers offer technological integration with their customers’ processes and data to increase visibility. They leverage their internal IT solutions, which allow information to flow back and forth throughout the entire network, thus strengthening relationships and operations transparency.
2) Out of date technology
The use of modern technology is necessary for businesses today. As companies start to stretch their business globally, connecting networks, sharing data, benchmarking and improving operations have become critical. 3PL providers understand the importance of IT systems. EDI (electronic data interchange), transportation management systems, barcoding, and data/reporting automation have become standard offerings by many 3PL providers along with optimisation tools. By selecting a 3PL provider that utilises modern technology, you are likely to be able to create a seamless flow of information, which will prevent operational disruptions.
3) Inefficient processes
3PL providers develop efficient processes and systems to keep the cost of operations low. 3PLs also benchmark their rates with competition and keep them competitive. This process ensures a more positive customer experience and a lower cost of operations. Moreover, to retain customers and keep them satisfied with their services, 3PL providers continuously improve their process efficiencies and continually look for ‘lean’ ways to reduce cost without compromising service quality, ultimately delivering improvements for their customers.
4) Capacity challenges
Capacity constraints can obstruct the operations flow and service commitments. The right utilisation of capacities while moving your products along the logistics chain can assist you to achieve the needed timelines for the optimal costs. A 3PL can assist you to optimise your space by maximising fill rates on pallets, containers, trucks, and planes. They deploy strategies for corresponding transport modes used in the logistics chain to reduce capacity challenges. A 3PL company is also able to keep track of the process and report exceptions to you electronically. The data is continuously analysed to predict and handle challenges proactively.
5) Liability challenges
Daily operational challenges are inevitable. Activities such as managing inventory records, transport documents, contracts, work force, and regular cycle counts are standard at many operational sites. 3PL providers have their own SOPs and team managers to handle these challenges for you. These team leaders are organised and customer focused, and will assist you to manage your shortages, pilferages, claims and the documents more efficiently.
6) Security issues
With every regulatory violation or damaged piece, your company loses money. Additionally it increases your customers’ waiting time and lowers your overall business performance. These are just some of the challenges you may experience if you manage your own logistics operations. Experienced 3PLs know how to handle your product whether via sea freight, air freight, surface or in a warehouse. 3PL ensure that the regulations are followed and security risks are mitigated as these can influence their own cost of operations. By outsourcing to a 3PL, you can be confident that you will receive industry best practices to manage security related issues.
7) Employee-related challenges
Scores of workers are deployed at warehouse sites to perform operations. Many times, flexibility to hire and lay-off these workers becomes a business need. At the same time, all employment must comply with government regulations with absolute accuracy. These regulations and processes can get quite cumbersome and any mismanagement is a potential business risk. 3PLs have been hiring permanent and casual labour for years and have developed systems and processes to manage this challenge flawlessly. Hiring an expert and professional 3PL to manage your operations can eliminate this challenge for you.
Today 3PL providers have become an extension for many companies. Over time, 3PLs have gained experience to provide strategic oversight and can assist in delivering operations change. Their IT solutions, efficient process, and visibility assist companies to overcome their operations challenges. A partnership with a 3PL can turn into an enduring strategy, rather than a short-term fix to your operational challenges. To learn more about eliminating operational challenge, read this case study from Taiao.
For more than a century, BCR has continued to help small, medium and large businesses achieve an optimum logistics solution with warehousing and transportation, including air freight and sea freight services to and from the major ports including Brisbane, Sydney, Melbourne, Adelaide and Fremantle (Perth).