If you are looking for a 3PL partner, then there is a good chance that you are in the process of getting quotes, looking at contracts, and thinking about what your budget is. Even though price is going to be a major factor when you are looking for a 3PL partner, it should not be the only factor. If you make the decision on your logistics partner solely based on price, you may end up paying more money in the long run. This is particularly true if you are looking for a supply chain logistics partner who specializes in refrigerated and / or frozen foods. Instead, you need to think about industry expertise, the infrastructure they have available, and their standard operating procedures.
If you end up choosing a logistics partner solely based on price, you are likely going to sacrifice some other aspect of your logistics program. This might be customer service and it could be innovation. This could lead to unforeseen consequences down the road that could cost your business a significant amount of time and money.
Fortunately, there are a few other factors that you can think about when you are trying to find the right 3PL partner to meet your needs. Thinking about these factors ahead of time will help you make the right decision for your business.
Reduce Your Expenses
First, try to find a 3PL partner who can help you reduce your overhead expenses. The right logistics provider should make it their top priority to keep your expenses as low as possible. They should leverage their own discipline and experience to help you save money.
When you are looking for a logistics partner, they should help you lower your costs continuously. They should be able to look at your numbers, brainstorm solutions, and leverage proven processes to help you improve your transportation management system, streamline your daily operations, and track your KPIs continuously. They should also be able to improve your strategies when it comes to production costs, Inventory management, and customer service.
When you were looking for a 3PL partner, consider going with a logistics partner who is the same size as your business. That way, you have access to the resources you need without overwhelming your partner with your own size. The right Logistics partner should know exactly what your business needs to help you lower your costs continuously.
Find the Right Industry Expertise
Next, you also need to find a 3PL partner that has the right industry expertise for your business. Have a partner who is an expert in your product and services. That way, you can expedite your path to success.
If you choose a logistics provider who specializes in your industry, you should be able to expand your network, control your costs, and improve your customer service because your logistics provider should already have connections throughout your industry, helping you expedite the Improvement of your business operations.
If you are trying to assess your 3PL partner’s industry expertise, you might want to ask about LTL transportation solutions, food-grade pick and pack options, and temperature-controlled fulfillment. The best choice for your 3PL partner should bring industry-specific knowledge that will help you avoid mistakes and save money. Finally, when you partner with a 3PL provider with the right industry knowledge, you can also make sure that you remain compliant with all relevant regulations. This type of industry experience will help you shorten the learning curve, allowing you to maintain an edge over your competition.
Look for a Scalable 3PL Partner
Next, the right 3PL partner should be able to scale with you, providing the most efficient solutions that meet your needs. As long as your business is doing well, it should continue to grow. On the other hand, you may notice a few drops in demand along the way. You want to find a 3PL partner who can scale up or down as your needs and demands change.
When you plan on expanding your business, your logistics partner should be able to provide you with an instant foothold in new markets with the right expansion plans. Furthermore, they should be able to help you change your existing operations, leveraging them to meet your newfound requirements. Particularly if you are expanding nationally or internationally, you may want to use the geographic footprint of your logistics partner to control your supply chain costs and take care of your inventory appropriately.
You want to partner with someone who is able to help you create a strategic network, setting up efficient distribution center locations that will help you get ready for new operations. Make sure that your 3PL partner is able to provide you with references that are larger or smaller than your company so that you can gauge when it is time to expand.
Finding New Ways To Innovate
It is also a good idea to look for a 3PL partner who is proactive when it comes to removing inefficiencies from your business processes. A logistics provider should be much more than simply a partner who takes orders from you. Your partner should be constantly looking for ways to improve your efficiency. That way, you can consolidate your business processes, saving money.
Talk to a potential partner about ideal KPIs and objectives for your business. Instead of simply setting it and forgetting it, your 3PL partner should be working hard to streamline their operations by increasing shipments, aggregating them, and looking for ways to shorten your supply chain. Using the best practices in the industry, there should be solutions that can be integrated into your business processes. With omnichannel experience, they should be able to find ways to implement the best combination of services for your company.
Identify Ways To Reduce Risk
Finally, the right logistics partner should also help you find ways to reduce your risk. Some of the most common examples of risk include costly delays, mistakes that are made in orders, and damaged inventory along the way. In addition to creating a significant amount of stress, this can also cost you a significant amount of money.
Make sure that you identify a 3PL partner who demonstrates stability. That way, you know that your 3PL partner is going to be a long-term asset. Continuity is a significant issue in this industry and it is critical for you to develop a strong working relationship with your logistics partner. Identify candidates who are investing in new technology, advanced facilities, and talented employees. This is a sign that they are making moves to ensure the continuity of their business. You also want to look at the culture of your logistics partner to make sure that they are a good fit for you. That way, you build a partnership that is built to last.
Find the Right 3PL Partner for Your Business
These are a few of the many factors that you need to consider if you are looking for a 3PL partner. Even though you certainly need to think about the price of your partnership, there are other factors that are far more important. If you do your due diligence and find the right partner to meet your needs, you will be able to save money in the long run.