Your Checklist for Selecting the Right 3PL Partner Basis Your Supply Chain Needs

A third-party logistics provider (TPL), often known as a 3PL, helps your organisation by bringing expertise and best practices that may effortlessly integrate into your current supply chain. 3PL companies specialise in a wide range of logistical areas and geographic locations. Early recognition of the potential advantages of a 3PL is crucial for cost savings and enhanced service. 

A third-party logistics provider provides an established network of important carrier alliances and a complete understanding of increasing process performance. With this in mind, the assistance of a 3PL is acceptable for cost reduction, improved customer experience, and route extension. 

Here are some essential aspects to consider while selecting a 3PL service provider. 

What exactly is a 3PL? 

Online retailers might improve their supply chain management by teaming up with a 3PL (Third-Party Logistics) provider. Some areas where third-party logistics companies may provide a hand are warehouse and inventory management, order fulfilment, shipment coordination, retail distribution, returns, and exchanges. 

In the end, working with a 3PL allows retailers to focus on other aspects of their business. 

You may store your inventory at the facility of a third-party logistics (3PL) provider and have the product sent directly from the manufacturer to them instead of keeping your warehouses and managing distribution in-house. The 3PL promptly delivers orders placed over the internet from its storage facility. As a result of the simplicity and efficiency of working with a 3PL, customers seldom give thought to the handoff between order acceptance and fulfilment. This allows online retailers to dedicate more time, effort, and money to developing, marketing and selling innovative items. 

Experts estimate that every 3.7 years, there will be a significant disruption in the supply chain. 

How does a 3PL operate? 

While the 3PL fulfilment process varies based on the supplier and services agreed upon, the usual approach is as follows: 

• The 3PL receives your goods and arranges each SKU in its warehouse. 
• Your website manually or automatically pushes orders to the 3PL when a client puts in an order (if its software integrates with your online store). 
• A member of the warehouse crew is given a "picking list" to use in locating and retrieving the items. 
• Items are packed in cartons with order confirmations and packing slips. 

• The 3PL creates the label or uses one of its shipping carrier partners. 
• The shipping company collects the package from your 3PL warehouse and delivers it to the customer. 
• Tracking data is transferred to the 3PL system and synchronised with your order management software. 

Advantages of Using a 3PL 

Businesses that employ a 3PL may anticipate a variety of advantages from the arrangement, including: 

Acquire knowledge 

Businesses dealing with a 3PL may obtain vital insight into possible shipping concerns, build industry contacts, learn how to optimise procedures, and more. Working with a 3PL relieves the burden of understanding and complying with foreign shipping rules for e-commerce enterprises that do international business. 

Save money and time 

If you are seeking motivation to work with a third-party logistics provider, the money you will save by tapping into their expertise should help sway your decision. Having a third-party logistics supplier handle your inventory management responsibilities can save you time and effort, allowing you to concentrate on other areas of running your company. Furthermore, your 3PL partner may detect potentially expensive difficulties in the supply chain and strive to reduce the risks. 

Scale your operations 

Partnering with a 3PL is still an essential step in growing a firm. Companies may utilise 3PL services to extend their reach for order fulfilment, simplify seasonal changes, save money on resources and personnel, and use recovered time to concentrate on the company and product development. 

A Checklist of Tips for Selecting the Best 3pl Provider 

1. Seek Professional Advice

You are the logistics operations expert, yet you may be ignorant of the benefits a 3PL partnership may bring to your company and profitability. Getting outside support when choosing a 3PL may help to expedite the process and decrease personnel and time commitment. Look for someone who understands third-party logistics and has experience dealing with various outsourced operations and suppliers. 

2. Security

Not only should your 3PL provide the essential staff safety training and compliances, but it should also secure your data and resources. Partners with FDA, DEA, PCI, and HAZMAT certifications will take safety and security seriously. 

3. Define your processes precisely

The absence of a defined approach is one of the most prevalent reasons for discontent among those seeking to assess third-party logistics providers. Nobody is sure of the predicted consequences or their order.  

4. Excellent client service

Respect and excellent customer service are essential components of a strong business partnership. 3PLs, with eager-to-help, innovative problem-solving team members, may save you money while also providing a pleasant working environment. 

5. Create an internal assessment team

Team members should come from various backgrounds, including supply chain, logistics, information technology, marketing, buying, and finance. This method ensures that the whole organisation will support your final choice. Furthermore, it emphasises the influence of logistics on the entire organisation and provides information that may aid in increasing the financial value reflected in the final agreement. 

6. Scalability

Preparing for the future and choosing a 3PL capable of handling your anticipated expansion is critical. Taking all other criteria into account, the 3PL you select should be able to move your organisation ahead and stay up with continual development rather than struggling to keep up. 

Can the 3PL's activities be effectively scaled to suit your changing requirements? 

Scalability in both directions has a direct influence on supply chain efficiency. While you are indeed attempting to grow your company, the fact is that it will have ups and downs. Demand may shrink for several reasons. You need a third-party logistics partner to scale operations across your supply chain quickly. On the other hand, you will need a logistics supplier that can handle sudden increases in demand planning in supply chain without skipping a beat. 

7. The 3PL partner's financial stability

Failure of your third-party logistics supplier might be one of your company's most severe problems. Finding a partner who has exhibited financial stability might assist in keeping your organisation from grinding to a stop as you try to recover from the mismanagement of another. 

Request a list of partners and questions about their connection with them while interviewing your chosen logistics suppliers. 

How logistics providers communicate with their partners is an excellent predictor of how they will deal with your company. Communication with their partners may give a complete view than communication with their hand-picked list of references. 

8. Customisation

Depending on your sector, your company may need varying degrees of personalisation. Ensure your selected 3PL partner understands what you anticipate in customisation, whether it's the multi-channel capacity or client experience. 

It is critical to determine [a 3PL's] market niche in the shipping and logistics industry. Many organisations may pretend to offer everything, but each provider has a core set of services on which they specialise and excel. 

9. Timely, well-coordinated meetings

Any agreement must include a requirement for key executives from the 3PL to attend at least quarterly meetings with a cross-functional team. Treating the 3PL as an internal component of management instils a feeling of dedication and responsibility for achieving the organisation's overall objectives. Collaboration and communication across departments assist in detecting operational and managerial issues. It gives vital insights into problems that might help a 3PL partner resolve them before they become catastrophic. 

Compatible technology, in addition to scalability and customisation, check that the 3PL has enterprise-level technology to meet your company's expectations, requirements, and changes.  

10. Effect on Sales

Evaluating the influence on sales is vital when assessing the true quantitative value proposition of working with a 3PL. Pursuing the lowest prices specified by a standard logistics partner may often result in poor customer service, which harms sales. References for a logistics firm should be loving, not sufficient or acceptable. For a logistics provider to benefit your company, its customers must rave about their improved sales. The ultimate goal of hiring a 3PL provider is to improve the overall efficiency of the demand planning in supply chain process, which may lead to improved sales and profitability. 

Wrapping Up 

A third-party logistics provider (3PL) may help your company save money, boost efficiency, and deliver excellent customer service. 3PL firms play an essential, multi-purpose function in the demand planning in supply chain, assisting their clients in growing their businesses and achieving sustainability while maximising their advantages.  

Cozentus is a market leader in third-party logistics (3PL) services. We have a long history of providing excellent customer service, using cutting-edge technology, and striving for constant development. Here are five reasons why Cozentus will be your company's ideal third-party logistics partner. 

1. We build long-term partnerships with our customers. 

At Cozentus, we think that long-term partnerships are essential to delivering the most satisfactory service possible. We take the time to learn about your company and your unique demands so that we may personalise our services to match your expectations. 

2. We have a successful track record. 

We have been in business for over 25 years and have worked with some of the industry's greatest brands. This experience has provided us with the knowledge and competence to deliver exceptional third-party logistics services. 

3. We are constantly striving to improve. 

We are always seeking ways to enhance our services and technology. We engage substantially in research and development so that we may provide our customers with the most up-to-date supply chain visibility solutions. 

4. We provide all-inclusive services. 

We offer comprehensive 3PL services, from transportation and storage to inventory management and order fulfilment. We offer the infrastructure and experience to manage all of your third-party logistics requirements. 

5. We are a technological pioneer. 

We were one of the first 3PL suppliers to give our customers an online interface. Our portal provides 24-hour access to your account, allowing you to monitor shipments, manage inventory, and make orders anytime. 

In addition, we are continually extending our portal to include new features and capabilities. Cozentus is the appropriate option if you are seeking a 3PL partner that can give excellent service, technology, and value. Get in touch with us to learn more about our services immediately.