Last modified: April 6, 2015
A highly efficient, cost effective and un-disrupted supply chain represents the foundation of every successful company. It allows every other operation of the firm to move ahead without concern for a lack of materials, supplies or parts. If you are considering the addition of a logistics service provider, adequately vetting that Global 3Pl will determine whether your supply chain adds value or becomes a cost drain. Flash Global suggests considering these 6 considerations to thin of when interviewing third-party logistics service providers.
The most crucial ability a global 3PL must provide is the capability to scale their operations to your growing needs. Bi-directional scalability will have a direct influence on the efficiency of your supply chain. Every company strives to grow, perhaps going global; however, every company also has ups and downs. When demand contracts regardless of the reason, a 3PL must be immediately responsive and scale down operations to minimize costs while maintaining efficient flow of goods.
Conversely, when demand skyrockets, you will need a logistics service provider that can manage the sudden spikes seamlessly and without effort. Businesses face growing pains at times, but a competent 3PL that offers holistic, comprehensive services and has experience handling sudden growth, you will most likely encounter a supply chain that provides added value.
Thus, finding a 3PL that has customers of all sizes will help to ensure that they can scale to your needs through multiplying or aggregating shipments or making small adjustments as required as your business meets each day.
Procurement and shipping may seem to be low-tech operations; however, logistics service providers must measure their performance by the efficiencies they provide. Thus, those 3PLs that embrace cutting-edge technology offer your company the greatest potential for optimization.
Cloud-based platforms and Internet of Things (IoT) devices have come into prominence, and they are giving 3PLs radically enhanced capabilities and capacity for control. A leading 3PL will have the latest systems that enable them to provide your firm with real-time data and feedback on supply chain operations and freight.
Whether you are vetting a non-asset-based logistics provider or an asset-based global 3PL, you should be offered a vast array of warehousing and shipping options suitable to your operations. Options and alternatives create opportunity within a supply network. When a 3PL has extensive relationships with multiple suppliers, you benefit from their ability to choose the lowest cost option. This makes having the leading technology platforms even more important for managing those options, identifying the most efficient and implementing it seamlessly.
The sudden demise or disappearance of your global 3PL partner can have a devastating effect on your business and customers. Finding a partner with a history of financial stability and solid payment history will mitigate the potential that the logistics provider will fail causing you damage from their own mismanagement.
As you evaluate the top 3PL candidates, ask for a listing of their partners and inquire about their payment history. Have they ever missed payments? How the 3PL handles business partners is a good indication of how they will treat your business, and touching base with those partners may give you a clearer view than a curated list of references.
Looking beyond the financial stability of potential 3PLs, ask about their overall track record. Do they count multiple companies as long-term customers? Do they have a reputation as an innovative, cutting edge firm with the latest technology? Every service oriented company lives by its reputation of reliability and efficiency.
The references for a third-party logistics provider should be beyond good or simply passable. They should be excellent recommendations that this 3PL will be worth the time, and clients should not hesitate to rave about the results they have experienced or about the security, flexibility and reliability of the 3PL.
In addition, references should speak to the culture and character of the global 3PL. Whether it is goods or service oriented, the logistics provider should be delivering a much higher value proposition than just efficiency. The ability to identify and exploit opportunities along the supply chain is a good example.
Efficient 3PLs get the job done; however, the best logistics providers can deliver on cost savings, time-to-market improvements and compliance. Seek out a 3PL that is known for their laser focused culture on providing the highest quality service and value added propositions.
The due diligence may be time consuming, but evaluating a 3PL should a process that is stringent in its examination. They will control a critical element of your operations. You should be able to determine in advance whether they will contribute to the success of your operations or be a drag on them. Flash Global has the professional service, innovative and proprietary technology and global footprint to deliver the results you need. Contact us today if you are interested in having a conversation with a global 3PL who has the capabilities to take your supply chain global.
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