Outsourced logistics functions can be a great way to reduce costs, improve efficiency, and enhance your service levels, but it’s important to partner with the right company. In this article, we’ll explore some of the top outsourced logistics strategies for manufacturers and shippers, and provide tips on how to choose the right provider for your unique set of needs. Whether you’re looking to outsource your entire operation or just certain aspects of it, this post will give you the information you need to make an informed decision.
Define your needs – what are you shipping, and where is it going
When defining your logistics needs, it’s essential to consider your product profile, where production occurs, and where your customers are located. For the products being shipped, their size, type, and any special handling requirements (i.e. food, perishable, temp controlled, hazmat) must be taken into account to ensure you can clearly communicate your unique handling requirements. Finally, knowing your customer base is critical in order to determine which geographic location(s) are optimal from a service and cost standpoint. Additionally, the type of customer you ship to is critically important to understand – are you shipping to distributors and retailer (B2B), are you shipping directly to consumers (D2C), or a combination of both (omnichannel). Doing this research upfront, and understanding the intricate details of your operation, allows you to communicate these details to outsourced providers so they can tailor their offerings to you.
Research different outsourced logistics companies (3PLs) that can meet your needs
Once you have a good grasp of your operational details, it’s time to start researching potential options. Focus on the geographical regions you have identified as being optimal to your supply chain. Additionally, look for providers who can meet your unique set of needs. As mentioned above, some of the key variables to consider would be – food, perishable, temp controlled, hazmat. You need to find a provider who can properly handle your product to meet these needs. Finally, look for providers that are able to handle all the channels in which you sell your goods – B2B, D2C, or both. Researching different companies will help you identify which providers may be a good fit for your business.
Get quotes from multiple providers to compare pricing
A critical component to any solution will be pricing, so it should come as no surprise that comparing pricing from multiple providers is the next critical step. Unfortunately, there isn’t a standard rate sheet used by all 3PLs, so you’ll have to really dive in and understand the difference in rate structures, and how they will apply to your business. This practice also provides a thorough understanding of what is available in the market to ensure your costs are in line with the particular market and service being provided.
Make sure the company you choose is reputable and has a good track record
When selecting a company for your needs, reputation and track record should be top of mind. A business with a good reputation is one that has been successful, efficient, reliable and cost-effective in the past and will take your project seriously. Asking for client references from prospective companies can provide first-hand insight on the reputation of their services. Don’t hesitate to ask how long they have been in business and who their current clients are to assess their reputation further. Choosing to work with a company that has an established reputation is crucial to ensure you get quality results.
Work with your chosen outsourced logistics provider to create an implementation plan that meets your deadlines and budget
Once your decision has been made, begin working with your chosen provider to create an implementation plan. It’s important to have as many stakeholders involved in this process as possible to ensure you have buy-in across the company. Things to consider during implementation include: transportation of your product to the new provider, IT requirements, customer service processes, and many more. The important thing is to get the conversation started as soon as possible.
With all these steps completed, you should be well on your way to a successful outsourced logistics partnership. That being said, we understand this can be a daunting task, and we’re happy to help guide you along the way. We have the experience and expertise you’re looking for to help guide you in this critical decision. If you’re ready to outsource your logistics, reach out to us so we can start the conversation, and set you on the right path for success.
