The supply chain becomes more complicated with the advancement of technology, visibility and navigating the risk inherent in working with a variety of carriers. Here at Flex Logistics, we have found that most companies try to handle their own logistics departments when they begin. They believe that in-house is better than outsourcing. While this might work fine at first, many of these companies are not taking into account the expertise, cost and time benefits of outsourcing logistics services to an experienced 3PL.
If you intend to expand your company, you should consider diversifying part or all of your logistical services. Outsourcing logistics has become increasingly popular, and for good reasons. Logistics outsourcing benefits far outweigh the costs. Using the assistance of a Third-Party Logistics (3PL) supplier is not just a great idea today, but it would also yield results terms.
Outsourced logistics services considerably impact business performance, and many companies see the benefits of managed transportation services, transportation management software and outsourced logistics.
Let’s take a look at 7 reasons as to why you should outsource your logistics to a 3pl company.
What is Logistics Management?
Logistics management is a supply chain management component that is used to meet customer demands through the planning, implementing and controlling the efficient flow of raw-materials, work-in-progress and finished goods and related information-from point of origin to point of consumption; with a view to providing satisfaction to the customer.
The logistics management process begins with raw material accumulation to the final stage of delivering goods to the destination. By adhering to customer needs and industry standards, logistics management facilitates process strategy, planning and implementation.
The different categories of logistics are:
- Third Party Logistics (3PL)
- Fourth Party Logistics (4PL)
- Inbound Logistics
- Outbound Logistics
- Reverse Logistics
- Green Logistics
- Construction Logistics
- Digital Logistics
- Military Logistics
Evaluate Your Needs
Before you choose a fulfillment partner, it is necessary for you to evaluate your specific needs. Prioritize your requirements and look for partners who can meet the expectations of dealing with the products and services offered by your business.
There are lot of companies and agencies to choose from, so it is extremely important to go for the right fulfillment partner who can fulfill all the requirements of your business.
Here are a few benefits that can help you make the right choice:
It should come as no surprise that partnering with Flex Logistics means more money and time. Every business owner wants to be successful, but keeping logistics in-house runs the risk of making costly mistakes. Not only can additional staff be costly, but general lack of experience will impact the satisfaction of the customer and damage the company’s reputation. The amount of detail and oversight needed to efficiently run even a small-scale operation is significant challenge and expense.
An excellent third-party logistics provider will have a vast network of qualified carriers with whom they have built relationships over the years and will help obtain lower rates and faster transit times. A 3PL will help you negotiate lower GRIs (general rate increases) and fuel surcharges. They can create cost-saving opportunities for companies running in-house shipping departments in most cases.
With the utilization of a 3PL you have the ability to reduce costs by eliminating the need to invest in warehousing space, transportation and the staff required to execute the logistics process. Researchers join your corporations to aid in identifying supply chain optimization potential and cost savings.
2. More Time, More Profitability
Ultimately, working with a 3PL can benefit your budget and operational efficiency. Outsourcing transportation management saves businesses time and money. Third-party logistics companies provide expertise to add value to your supply chain processes, giving you time to focus on what matters most – your products, business and customers.
If you are experiencing rapid growth, need more flexibility, have increasing logistics costs, or want to focus more on your core business initiatives, Flex Logistics might be a great fit for you.
Better Customer Service
When your things are delivered on schedule, your customers are excited and happy. With greater experience, a more refined ability to coordinate shipments from departure to destination, and around-the-clock attention on the logistics operation, a 3PL provides superior customer support. Companies with their own internal logistics operations may juggle employees among different tasks and departments and make serving customers directly more challenging.
You can be sure that your shipments come on time and budget when you outsource to a 3PL like Flex Logistics. The advantage of outsourcing your logistics is that you will know that is all we do. They are experts in their sector and go above and above when it comes to providing techniques and ideas. The 3PL’s purpose is to form a long-term strategic partnership with the customer.
4. Risk Management
Outsourcing the risks of transportation operations to a logistics services provider protects your organization from penalties and fines. We understand and comply with state and federal DOT regulations. Also, if a shipment is lost, stolen, or damaged, it is the 3PLs responsibility. Ultimately, a 3PL helps prevent these types of incidents.
If your business is growing and you are trying to scale your existing logistics team to accommodate for growth, you might spend more than you plan to. Achieving economies of scale is riskless with a 3PL partner since their focus is on logistics services. Scaling up or down at times of need is also possible with this partnership.
5. Flexibility & Potential for Expansion
Third-party logistics outsourcing give you the potential for expansion. By creating a network of accessibility and optimization, Flex Logistics shows how expanding to bigger markets will create a competitive advantage at the lowest amount of risk. A 3PL is familiar with complex regulations and can handle fluctuating shipment schedules. A 3PL can handle regularly scheduled shipments across all modes and lanes, plus any expedited shipments. Shippers also benefit from increased load consolidation, frequent backhauls, and optimized routing and distribution.
Your logistics needs may change as your company grows and expands; reflecting anticipated seasonal demands as well as market developments. At their most basic level, these fluctuations may result in changes in the required labor levels. They can, however, need more substantial changes to your supply chain, such as changes to the inventory list, placement, workforce profiles, adaptive control, and more.
6. Smooth Adaptation to an Evolving Market
Despite the most dedicated company’s best efforts, the world of logistics is an ever-changing landscape that requires constant monitoring to save money. The advantage of logistics management is employing experts who have spent their professional lives developing refined logistics management techniques to work out the kinks in your shipping operation and optimize your budget.
3PL outsourcing also has a benefit of the latest logistic technology, and most importantly, customer data that competitors may not have access to. The biggest advantage is a manufacturer does not have to expend and risk capital on this data. 3PL benefits your consumer, which in turn, will mean a more successful business.
The FLEX Logistics Team is Here to Help!
Our team understands the importance of getting your products to the market. That is why we aim to understand your business and build lasting relationships with you and your team. Whether you are looking to add a new warehouse to your existing operations, growing and need to increase your distribution efforts, or starting a new company, FLEX has the solutions to meet your supply chain needs.
Contact us today to discuss your current and future warehousing and logistics needs. We will work together with you to understand your requirements and develop a solution that will set you up for future success.