3PL companies provide cost-effective, end-to-end supply chain logistics services to businesses. The services offered by 3PL providers include warehousing, freight forwarding, domestic transportation, customs clearance and value-added services. Many business owners and CEOs in Australia get the most out of their logistics solutions with the assistance of professional 3PL providers. However, before you first engage with a 3PL company, there are a few facts to be aware of and some misconceptions that need to be clarified. Some common misconceptions associated with aligning with a third-party logistics company include increased overall costs, more hectic work, business security breaches and losing control over logistics operations.
However, in most cases, outsourcing to a 3PL provider assists in making a business more organised, efficient and profitable. The expertise and resources available from a third-party logistics provider assist in reducing overall costs and free up your in-house resources which enables you and your team to focus on growth plans for your business.
Read on to learn 5 facts about third-party logistics providers and how they can enable the growth of your company.
1) Providing all services under one roof
Receiving all the freight and logistics services you require under one roof can save time and cost. This also provides better control and visibility of your business. For a business owner, alongside the core activity, performing all logistics operations can be very challenging as well as hectic. It demands time, energy, additional resources, and infrastructure and capital deployment. 3PL providers bring all the required services under one roof. Whether you need warehousing, value-added services, custom clearance, international freight forwarding as well as domestic transportation and IT-support, you can rely on a professional third-party logistics provider to take care of your business. Outsourcing can save you time, energy and money.
2) Strong relationships and international network
If you are shipping internationally, strong relationships with a global network and coordination with this network are the keys for perfect and economic deliveries. Business owners can find it challenging to manage an international supply chain along with core functions such as Sales, Marketing and Product Development. Third-party logistics providers have a proven global network, strong relationships and coordinate many shipments for many customers day-in and day-out. These professional 3PL providers understand the criticalities involved in international freight forwarding and take care of your logistics requirements with more dexterity, giving you not just a great service but peace of mind as well.
3) Professional services and knowledge
Supply chain is a vast function and requires professional skills in each of the sub-functions to deliver optimal results. Third-party logistics providers have professional teams responsible for each sub-function and they bring their expertise to manage the supply chain process seamlessly and deliver the desired results. The latest information technology provided by third-party logistics providers allow for monitoring of your inventory, timely reporting and end to end visibility. Building in-house resources for each of the sub-functions can be highly demanding on any business owner’s tight schedule and can be sub-optimal despite best efforts. Outsourcing allows you to enjoy professional services with economic monthly charges.
4) Improve profit margins
Logistics costs form a substantial part of the total landed cost of most products. Successful outsourcing of your warehousing requirements can generate substantial savings if optimally managed. 3PL providers have many customers that use each of the logistics sub-functions and they also have volumes to negotiate better prices with warehouse owners, airlines, shipping lines and domestic transport providers. They also have valuable intelligence on current market conditions with regard to costs and space availability. Receiving the same competitive rates as a single customer with lower volumes can be tough and hence can result in higher costs. Third-party logistics providers pass along lower rate benefits to their regular customers and this can assist in reducing the landed cost and improve the profit margins.
5) Swift expert response team
Supply chain logistics become get quite complex and technical when it comes to exception handling. Service providers such as shipping lines and domestic distribution companies can demand or give information which can be confusing or sometimes misleading, thus making it difficult to comprehend and provide the right response for the situation. With a 3PL by your side, you don’t need to worry about these situations. Either your 3PL provider will manage the response on their own or even if your intervention is required, you would be asked for it in simpler terms. All this takes loads of stress off your shoulders and keeps the response swift for the shipment to arrive according to the pre-planned schedule.
Knowing these five facts about third-party logistics providers will assist you to understand the real value a 3PL can bring to the table regarding better rates, services, expertise and network. Many business owners come to this understanding quickly. Choosing the best one suited to your needs will take a bit of effort upfront but will bring long-term benefits. The ‘right fit’ frees time to focus on generating growth for your business and assists in improving your profit margins.
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).