Small to mid-size retail and manufacturing businesses worldwide are partnering with 3PL providers in an effort to navigate the complex government regulatory framework. Building lasting partnerships with your third party logistics provider allows you to leverage their experience, resources and collective bargaining capabilities. This can help your business to control costs, improve customer service capabilities and much more.
A critical function of the 3PL-shipper relationship is the transfer of knowledge from one party to another. Industry-leading third party logistics businesses have their finger on the pulse of the industry, making themselves subject matter experts on industry best practices. When you select a 3PL that understands how your business operates now and in the future you can ensure that your business can always meet customer needs.
In recent years, with the increasing popularity of omni-channel retailing, retailers and manufacturers are entering into longer term agreements with their supply chain partners. This is advantageous because it provides the 3PL with an opportunity to become accustomed to how your company operates and understand what value-added services you may need. Negotiating longer term contracts also provides cost saving opportunities with preferential pricing structures.
Developing a partnership with your third party logistics provider also allows you to utilize their flexible capacity as needed. As demand for your products fluctuate due to seasonality your 3PL can forecast and make available the appropriate storage space. This allows your business to expand or contract as needed with little to no added cost.
Many small to mid-size businesses do not allocate significant funding to technology investment due to financial limitations. This can be detrimental to the success of your inventory management as manual data entry and management is typically riddled with errors giving your team an inaccurate view of available inventory. By partnering closely with your 3PL you can take advantage of their technology portfolio which will typically include: warehouse management software, RFID or ADC technologies, material handling and more. Having all of these tools at their disposal allows your 3PL to maintain an accurate inventory count and generate useful report and metrics.
Third party logistics businesses can also help you to save costs related to services such as transportation. By leveraging the collective bargaining of all of their customers they can receive notable price breaks, saving shippers money. If you would like to learn more about leveraging your 3PL relationship contact Datex today at email@example.com or 800.933.2839.
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