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What To Know When Working With A 3pl Company

Sunday, January 27, 2013

When it comes to adages such as “time is money” and “a bird in the hand is worth two in the bush," applying these to the way you operate your business often leads you to engaging a third party logistics (3PL) company to facilitate your supply chain operations.

Your businesses bottom line can be impacted negatively if there is an inefficient supply chain established. Essentially, a 3PL company acts as the intermediary between you and shipping and delivery carriers. To ensure your goods reach their destination in a timely manner, a 3PL company can incorporate services such as warehousing and transportation services, integrated packaging and much more at the best price. With the supply chain being such an essential element of your business, outsourcing these services can save you time and also have a positive impact on your customer service by professionally putting the bird into the hand. These particular skills in-house for supply chain are not needed when engaging a third party specialist which enables you to direct attention to other elements of your company. Since they are able to get certain volume special discounts, these 3PL companies can save on your shipping and transportation expenses.

When it comes to outsourcing tools these logistical services, you are going to want to check the stability of the 3PL credit. In this respect it can be a good idea to find out from the freight companies they service what they are like to do business with. Because this is a company who could be representing you and your business, you really need to make sure your reputation is not damaged in any way by an unprofessional company working on your behalf. Get a perspective by speaking with freight companies about what a 3PL firm is really like. Do they have a good reputation? Are they really on a financial basis secure? Are they really in financial stable and in fact pay their bills on time. Additionally it is important for you to be clear about your obligations should your 3PL company fail to deliver. Arrangements will have to be discussed and what type of insurance coverage is there for your protection. A report on the 3PL credit rating can be obtained by a credit checking company who will present you with helpful information.

When going into an agreement with this type of company, you need to be clear about what your expectations are and if the 3PL company is equipped to fulfill them. The partnerships your company already has in position and the scale of logistics needs can be deciding factors when it comes down to your 3PL company preference. One of the add-on services a 3PL can provide you is access to data and reporting components that can provide assurance to you on the exact costs of shipping and also provide you with an insightful and accurate glimpse of every stage of the supply chain that may be difficult for you to ascertain on your own.

Working with a 3PL company is a business relationship that could be helpful to you overall. It can help to think of them not as an outsider but as an extension of your business. You subsequently need to have a clear a precise idea of who you will be dealing with. It is ideal if they know you and your business well to ensure that them to represent your interest effectively. Finding a company that can change and grow with you and be forthcoming in terms of identifying aspects of the supply chain that you could improve upon, or finding solutions for you that you may not have considered, can lead to long-term and mutually beneficial relationships.
 
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