Third Party Logistics, or 3PL, is a service that is experiencing incredible growth. According to a study by Armstrong and Associates, approximately 400 of the Fortune 500 companies use 3PL, and nearly all of the Fortune 100 companies use a 3PL company in some capacity to meet their logistics needs. So what is 3PL? Is it something your company should consider using? Let's take a look at what 3PL is and why it is a service your company might need.
At its most basic third-party logistics is just what it sounds like, using an outside company to handle some of or all of your company's freight transportation needs. These companies offer a wide range of services, from fulfillment and distribution to warehousing, over-the-road freight delivery, trucking, drayage, and more. One of the biggest upsides of these services is they are experts in logistics and have experience providing these services in addition to having developed a wide network of shipping partners. Using a 3PL company to handle your logistics needs can alleviate a lot of concern and headache for your company.
3PL- Not Just For Large Companies
3PL is not just for large companies. It’s also an exceptionally good option for small or growing companies that are at a point where managing the shipping of inventory is becoming too costly or time consuming . Knowing that your goods are being handled and delivered by experts is one less worry for you and your company. 3PL also provides a level of flexibility that can be important to small or growing companies, your company may need to scale faster than an internal logistics solution would be able to handle. Having this option provides peace of mind that other options may not offer. Going even further, single-source logistics companies can handle all of a company's logistics needs; a much better solution than trying to piece together a distribution network yourself.
These companies can also provide services beyond simply delivering goods. Many offer warehousing of goods as well. This service eliminates the cost of building new or additional storage facilities, as well as additional employees to staff this business function. At Port City Logistics, for example, we have over 2 million square feet of cutting-edge warehouse space in the Savannah, GA area, with easy access to both I-95 and I-16. These are crucial for a shipping company here in Savannah GA.
3PL companies can also provide even more services if your company does international business 3PL can often time handle the associated paperwork, customs, and other issues that arise when transporting goods across borders. Again reducing workload and costs for your company and leaving it to experts in the field.
Choosing a Single-Source Third Party Logistics Partner
If you or your company has decided that outsourcing logistics is the right move, the next step is to choose a 3PL company that works for you. Not all 3PL providers may be right for you and vice versa, and there are some important questions to ask. Do they have experience working with companies of the same size? Do they have experience shipping and handling similar goods, and if not, are they able to accommodate your company's products. Does the 3PL provide the exact services that your company needs? Some may specialize in certain functions or goods. Finally, do they have a reputation that you are willing to stake the reputation of your own on?
Owning or running a business can be both incredibly rewarding as well as incredibly stressful. Knowing that your company has the ability to outsource a critical business function to experienced professionals who are committed to helping you succeed can go a long way towards helping you. 3PL is a service that most of the country's largest companies use and is worth looking into for your needs as well.