3pl stands for third party logistics provider, and these offer logistics services to support specific aspects of shipping operations. Usually these 3pl providers are integrated within a company’s transportation and warehousing procedures.
Through the scaling and customization of different services, 3pl can meet specific needs required by your business; it is up to you as to how much a provider will help to assist you with in your business operation. A provider can help to deliver one singular service for your business or multiple services across different aspects of your business and supply chain. The services all work together in order to achieve visibility in all aspects of the supply chain as well as creating valuable ways to enhance the operational, end customer and financial performance.
It is obvious that 3pl provides many benefits for your business, especially when it comes to the supply chain and in specific relation to shipping operations.
Here are some of the ways that 3pl can benefit your business.
Gain knowledge and expertise
Often, the supply chain can be complex and a difficult process to manage.
Fulfillment, warehousing, and shipping combine to create a difficult process that can come with major challenges. Because of this, many business owners can struggle to keep up with all the processes that are happening at once.
As a result, the operation can falter if it is not managed properly and ultimately, the business can lose profit. 3pl are always experts when it comes to the supply chain as it is their main focus of the business operation.
In working with 3pl, they are able to pass on their business wisdom and knowledge which can help you to understand and manage the supply chain better. In addition to this, 3pl have connections that can help you to quickly streamline your business processes. Streamlined business processes are better for you to manage and make the whole operation much more efficient and effective.
Moreover, they are able to provide knowledge and insight into specific issues that may arise associated with international shipping. These issues can include customs, duties, documentation, and differing shipping regulations.
Figuring this out on your own can be difficult, whereas getting help from a 3pl can ensure you are getting advice from those who know what they are talking about.
Save time and money
By using a 3pl, you will essentially get rid of the need to have a warehouse, the technology needed to carry out logistical processes, and the transportation required as well. In doing so, you will obviously save a lot of costs by outsourcing it to a provider. Furthermore, with their knowledge of the supply chain, they can point out mistakes to businesses that they may not be aware of, again helping them to potentially reduce their costs. Their knowledge also allows them to provide industry forecasting which can help the business to optimize their inventory levels and save on holding costs for their inventory.
All of this added up results in an amount of money that is saved by using an external provider.
Scale operations and be flexible
When a business uses an external provider, they are able to scale the labour, space and transportation according to their business’s current inventory.
They are always looking for ways to improve the supply chain aspects of the business, and will have the right technologies and tools required to do so.
This makes them very flexible given their ability to scale.
In summary, a 3pl can be a very useful consultancy as well as being able to provide the tools and technologies required to improve your supply chain and all aspects of the shipping operation.