Having a third-party logistics partner could greatly benefit your warehouse as warehousing and logistics are complicated business these days. Long gone are the old, dusty shelves where products went to sit for months on end. Today’s facilities are bustling, with a constant flow of products in and out the doors. To keep pace, there’s a bevy of sophisticated equipment, technology and software required. For some companies, outsourcing all the warehousing tasks via a third-party logistics provider is the best option. Determining what the right answer is for your operations requires a hard look at your present and current plans, budget, and more.
Some of the benefits of outsourcing to a 3PL include the fact that they can provide flexible, adaptable storage options for you, key in a highly seasonal industry. They also have the latest and greatest software to effectively manage your operations, from inbound to outbound. All that said, it’s not the answer for everyone, nor every scenario. In fact, in the long run, partnering with a 3PL may prove costly, and also somewhat confining when you are accustomed to total control of operations. Additionally, a 3PL might charge for unexpected or hidden fees you didn’t see coming when you signed your contract.
One of the biggest mistakes companies make is simply comparing current operations to the service and cost equation of a 3PL. Before jumping to a conclusion based on those metrics, take the time to see where and how your warehouse could improve. If you were to make up for any performance gaps, you might find that this upgraded version of your current warehouse is preferable. Outsourcing may not be the panacea you expect, and with a revamped model of processes, equipment and technology, your in-house operations may exceed your expectations.
A qualified supply chain consultant can help you perform a thorough analysis and come up with the right answer. Together, you can begin asking important questions about outsourcing to help you determine if there’s a 3PL that can meet your needs.
You’ll Need to Consider Several Factors In Outsourcing To A Third-Party Logistics Partner, Including:
- The information 3PL providers need to provide you the service you want;
- Which 3PLs might be best suited to meet your needs, and then how do you carry out a bidding process?
- How to perform the best analysis of the proposals you receive in turn;
- How to seamlessly migrate your operations to your chosen third-party logistics partner.
Your consultant can also perform a cost-benefit analysis, the feasibility of each approach, and insights on any potential partner you are considering, It’s worth taking the time to carefully determine what improvements you can make internally before you jump ship to outsourcing to a third party logistics partner.
If your warehousing operations are struggling, working with a consultant to determine the best solution is a worthwhile investment, contact our experts at OpsDesign today. There are pros and cons to each warehousing scenario, and only a thorough analysis performed by a qualified supply chain consultant can give you the best answer for your particular operations.
