Outsourcing logistics processes to third-party logistics companies is more common than some shippers might think.
Third-party logistics companies offer a suite of services, including supply chain management. Efficient transportation is a competitive advantage in today’s marketplace, so many companies now focus on optimizing logistics functions.
6 reasons to outsource transportation to third-party logistics companies:
Save Time and Money
Third-party logistics companies have expertise, transportation management software, carrier network, and reporting capabilities, so they assure time and cost savings for the shipper.
3PLs leverage industry relationships and shipment volumes to get lower prices. They can negotiate lower fuel surcharges, too. Also, third-party logistics companies have thousands of carriers in their fleet network, so carriers bid on freight which lowers the price significantly.
A 3PL will continuously search for ways to cut costs and add value to your logistics operations. Also, there’s a dedicated team of experts monitoring, analyzing and optimizing processes every day. A 3PL will make sure that transportation operations never fall victim to the constantly changing supply chain environment.
Outsourcing the risks of transportation operations to the logistics provider is protecting your organization from penalties and fines. Also, if a shipment is lost, stolen or damaged, it’s the 3PLs responsibility. Anyway, a 3PL lowers these incidents.
A 3PL with a TMS is instrumental for insight into the supply chain. TMS technology provides the custom data you desire. TMS software is very expensive, so when a 3PL integrates the technology, you save money and get more accessibility to capacity. Shippers benefit from increased load consolidation, more frequent backhauls, and optimized routing and distribution.
Through a 3PL partnership, your operational control will increase. However, outsourcing is a two-way street. Presumably, reputable 3PL will collaborate and report to you regularly which creates visibility and real-time metrics into your transportation processes than ever before.
At the end of the day, outsourcing transportation management saves businesses time and money. Third-party logistics companies provide expertise to add value to your supply chain processes, so they give you time to focus on what matters most – your products, business, and customers.