What to Consider when Choosing a 3PL

Choosing a 3PL

Once you’ve made the decision to outsource your logistics functions, finding and choosing a third-party logistics provider (3PL) is the next step. First of all, what is a 3PL? A 3PL is a company that provides logistics or fulfilment services to other companies. A 3PL is responsible for looking after a portion of, if not all of your supply chain, ensuring your products complete their journey.

Selecting a 3PL can be tricky, particularly in today’s competitive economy. Whilst cost is an essential part of the selection process, there are other important considerations that need to be taken into account.

Like-Minded Business

It is important to look for similar business values and morals. Your chosen 3PL will become an extension of your business and can often be customer or client facing as a representation of your business.

Detail

Providing all of the details to your 3PL is very important. Documentation your exact requirements through a Request for Information (RFI) will allow the 3PL to accurately determine whether or not they will be able to handle your goods and importantly, accurately be able to quote.

Processes

It is important to outline a clear process from the outset. Defining expectations and working together on a clear process will reduce any potential strain on the relationship. Both your business and your 3PL need to be operating towards the same goals.

Stability

Imagine 6 months down the track, everything is going well and your company is growing, partly a result of your relationship with your 3PL. What happens if overnight your 3PL goes out of business? It is important to do your due diligence and to take the time to learn about your 3PL, their history and their future goals.

Flexibility

Can your 3PL cope with the everyday changes that may affect your business. Can they handle it if your company doubles or triples in size rapidly? Equally, will they stick around if growth is not as attractive as what was forecast?  It is important to look ahead and cover your bases.

One Stop Shop?

Does your 3PL offer freight forwarding, customs clearance or any other value added services that will benefit your business. Utilising the one 3PL for each of these services can be very beneficial as they will oversee the entire supply chain, which should result in efficient and cost effective service.  

Always be prepared to ask a lot of questions and ensure that a 3PL is the right fit for your business. This can be an invaluable step for business growth and is one worth every consideration.

You can find out more about BTi Logistics 3PL services here - www.btilogistics.com.au 

Third party warehouse? Why should I pay someone else?

Third party warehouse? Why should I pay someone else?

The notion of handing control over your product(s) to another party is a strange one. You’ve developed, manufactured and grown your products, so naturally you want to be the one to handle the logistics in order to see your product reach its destination. Whilst this is a possibility and can work in many cases, it is known that logistics can be the hero or the villain of your show. Managing your own logistics does have its benefits:

• You have full visibility and management over the handling of your product
• It appears to be a cheaper option when comparing to the alternative
• It can be as flexible as you make it

On the flip side, it can have a negative impact on a growing business:

• Increasing space requirements, resulting in increased rental cost
• Staffing costs and management
• Building, machinery and maintenance costs
• Your time

A rapidly growing supply chain requires time and resources, both of which can be invaluable to other areas of an expanding business.

So, what benefits can a third party warehousing solution bring to you?

• The ability to allocate your time and expertise more effectively
• Cost savings due to lack of staffing, materials, rental costs, software costs, maintenance costs, machinery and equipment costs
  

The right third party solution should be treated as an extension to your business. Through using the right provider, you can gain access to:

• The latest warehousing management system technology and ecommerce integration
• 24/7 visibility of your supply chain
•  Lower costs due to leveraging a third parties buying power and resources

Choosing the right partner is essential to maximising the potential growth opportunities.

BTi Logistics is an Australian owned 3PL. Our 8,500sqm warehousing and distribution facility in Melbourne handles a diverse range of palletised and unpalletised freight. We offer a full suite of warehousing services including full pick and pack, ecommerce integration and distribution. You can find more information about our warehousing services here.