3PL Strategy: What is the 3PL Strategy
Today, we can see that there are more and more companies that decide to outsource their supply chain by hiring 3PLs companies. So what does 3PL means, what do they do, and why so many companies decided to outsource their supply chain?
What does Supply Chain means?
Let’s first talk about the Supply Chain. The supply chain is the whole logistic pack, which means the whole organization and management of the logistics that will allow you to develop your business. But the problem that small companies have with their supply chain is that they don’t have enough experience to manage a warehouse and its whole logistics. So this is when the 3PL takes action.
What is 3PL?
In other words, 3PL means third-party logistics. Their mission is to help companies that want to outsource their logistics. Their role will be to take care of the pricing, packing, do the inventory, the delivery, the transportation, and other services related to logistics for the company that they work for. Hiring a 3PL company will give you more time to spend on your main missions in sales, marketing, and product development.
There are a lot of positive aspects with the 3PL’s companies because they can lighten up your work more than you can imagine.
As we mentioned earlier, the main tasks of the logistics companies are to take care of the merchandise in their warehouse, do the inventory and deliver the product to the client. It seems like an easy task but there is a lot of advantages if you hire a logistics company.
3PL companies can get you reductions in transportation or other services because they have more advantageous prices than individuals. As they take care of a lot of companies’ logistics, they are a bigger client than you are toward the transportation services, so they can negotiate better prices that can benefit small businesses.
Adapts to the needs
Logistics companies can also adapt themselves to their customers’ needs as they can negotiate the prices with the different suppliers but also because they offer a lot of services that can satisfy a lot of different companies with different needs.
If you are in charge of a young small business, outsourcing your logistics can be a good solution to start. You might be skilled in sales or marketing or product development but managing a warehouse requires another level of skills that you might not have for the moment. 3PLs can offer you less hassle but will also allow you to invest more time to develop your own business.
When you have your own business, your main goal is to satisfy your clients, but if you don’t have the resources or the skills to do it, it can be dangerous for your clients. As 3PLs have better and more professionals services, they can provide you and your clients the fastest shipping.
Outsourcing your merchandise through 3PL will also free you from a lot of worries, as your merchandise will be protected at any risk. If there is a problem with the shipping it won’t be your mission to figure it out and you won’t be responsible for any type of damages, the logistics company will take care of it. You won’t have to worry either about your lack of experience in logistics because a group of professionals will be there for you.
We can say that 3PL is a really good solution, but of course, there are not just positive things about it, we can also see some negative aspects. For example, the fact that you are not the one in charge of your merchandise anymore. But also the fact that you need to trust the company that you hire because if they make a mistake, the customers will be blaming you as the customers are only connected to you. So it can have a bad impact on your reputation. This is why you need to look for the pros and cons before outsourcing your merchandise with a random company.