Optimizing Supply Chain Management Using 3rd Party Logistics

Why choose a 3PL?

Is handling and managing the daily orders getting overwhelming for you? Or are you running out of inventory storage? Regardless of what the case is, you will need a 3rd party logistics company to assist you with your expanding business!

The concept of 3PL has been around since the 1980s, but it did not gain a firm footing in the retail industry until e-commerce begins to spread all around the world. From Fortune 500 companies to small-sized retail businesses begin to realize the importance of using 3PL in their business. The global acceptance of 3PL paved the way for the emergence of numerous trucking carriers increased from just 20,000 in 1980 to 1.2 million today.

According to the Armstrong & Associates report of 2013, almost 86% of the Fortune 500 companies from the domestic sector are making use of 3PL.

Beginning as a transport service, 3PL made inventory management and logistics an integral part of their services due to the technological boom in the year 2000. 3PL is a helpful tool for the businesses as it provides significant assistance in the management of the supply chain. It is due to the 3rd party companies that businesses are getting a chance to focus on the core competencies rather than the logistics.

All companies require extra storage space and heavy equipment movers for efficiently managing the distribution and enhance the functionality of the supply chain.

Third-Party Logistics and the Supply Chain

The 3PL companies manage the business’ distribution and fulfillment of services. The companies produce products and a 3rd party logistics company fulfills the orders of the products a business receives. The companies use four crucial capabilities to compare and choose the perfect 3PL, which include warehousing, transportation, distribution, and shipment/receiving.

Integrating a 3PL in your company’s supply chain will help you address the toughest challenges in supply chain management. All businesses, irrespective of their size, can significantly benefit by outsourcing its logistics matters to enhance the efficiency of the supply chain.

Costly Maintenance of Extra Storage and Vehicles

Businesses who experience considerable fluctuation in demand and do not have a consistent production have to spend capital on maintaining the extra storage space and transport vehicles they have. By having an external entity managing the logistics, inventory, and transport, a business can stop paying for the maintenance of the warehouses or transport. 3PL allows flexibility which saves a business from unnecessary investments draining resources when the sales cycles are low.

Ease in Maintenance of a Global Supply Chain

For businesses that have their roots all around the globe, maintaining the supply chain possesses several challenges. To deal with global compliance issues, economic regulations, and transportation a company requires experienced staff which is not something small and mid-sized businesses can manage. Outsourcing to 3PL is one-way businesses can seamlessly manage a global supply chain.

Convenience in Tracking Products from Origin to Final Delivery

Tracking the products from origin to the final delivery is very challenging for a company, especially if the company is managing an internal supply chain. Tier 1 3PL have the system to provide real-time visibility of the supply chain.

Be it heavy equipment movers or a warehousing facility; a 3rd party logistics company can help you optimize your company’s supply chain to provide the best results. Whether you are managing a local supply chain or maintaining an international supply chain, a 3PL like Titan Worldwide can help you enhance your business!

Author: Justin Tyme
Justin Tyme is a seasoned marketing expert with a focus on the supply chain, logistics, and heavy machinery transportation sectors. He serves as the Senior Director of Marketing at Titan Worldwide, where he manages the company's content marketing strategy and lead generation. You can connect with Justin via his email.
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