3PL Trends 2014

With a growth rate exceeding 3 times the rate of growth of the U.S. economy, the third party logistics industry is booming in the United States and around the world.

3PL growth is fueled by the improving U.S. economy and increased manufacturing levels, nearshoring of manufacturing to Mexico, new oil and gas operations in North America, new global opportunities and the need for new technologies and services. The third party logistics industry is undergoing consolidation due to an influx of private equity investment.

Challenged by their need for technology and talent, third party logistics providers have begun to attract employees with degrees in supply chain management from major universities. 3PLs are evolving: freight brokers are adding value added services and many third party logistics providers have added freight brokerage to their list of services. With the increased stress on freight and transportation due to the federal regulations, shippers and 3PLs have reported increased supply chain collaboration has become the norm in order to improve logistics cost and services.

Healthcare and automotive manufacturers have been spinning off internal logistics departments, distribution networks and dedicated fleets as freestanding 3PL businesses. In addition, manufacturers with unused warehouse space and logistics resources are starting 3PL businesses to maximize the use of their assets. Shippers report using more than one third party logistics provider and benchmarking their performance. To the majority of shippers, customer service is even more critical than cost.

More than ever before, shippers are relying on 3PLs to fulfill their supply chain technology strategy and implementation needs. EDI, TMS and WMS are some of the top technology needed by shippers. Omni channel retailing and direct-to-consumer fulfillment are the two trends transforming the supply chain today, forcing the realignment of distribution pipelines. With more vertical centric third party logistics providers in operation, shippers typically use an average of 3PLs for logistics and supply chain functions.

To learn more about how to implement a WMS to make your pharmaceutical supply chain more effective and efficient contact Datex today marketing@datexcorp.com or 800-933-2839 ext 243. Datex is an industry leading supplier of supply chain solutions including WMS, mobile solutions and professional and managed services.

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