Third-party logistics (often abbreviated as 3PL) providers are outsourced logistics providers that work with businesses to help manage and move freight. Shippers turn to 3PL providers to help make their supply chains more efficient and allow them to focus on their businesses.
3PL providers help with some or all of these services depending on the shippers’ needs.
- Transportation and freight management
- Distribution management
- Freight consolidation
There are three main benefits to working with a 3PL provider:
1. Resource Network
3PL providers usually have a vast network compared to businesses’ in-house supply chains. 3PL resource networks are set up to be the most efficient and cost-effective solution for businesses. Since 3PLs focus on logistics, they spend more time creating relationships and securing discounts with warehousing and transportation providers.
2. Saves Time And Money
Using a 3PL saves time and money. 3PLs take the work of coordinating the supply chain, including billing, training, obtaining paperwork from the shippers and getting the freight where it needs to go. Since 3PL providers have an extensive resource network, they are able to secure competitive rates for shippers to save money, too. 3PL providers help with bid procurement to create a standard operating guide for a shipper’s transportation needs. Working with a 3PL provider ensures freight is moved in a cost effective and efficient way.
3PL providers have the ability to scale space, labor and transportation depending on a business’
inventory needs. This is a huge benefit for businesses with seasonal demand. When seasons change and demand grows, it is an easy transition for the shipper to get more warehouse space or freight transportation.
If you are interested in learning more about 3PL provider benefits or working with a 3PL, contact us here or give us a call at (877) 273-8300.