Third-party logistics,3PL companies, are playing an increasingly large role in supply chains. While shippers continue to leverage 3PLs for spot loads or as backups to asset-based providers, we’re frequently seeing them choose 3PL companies as primary, contracted carriers as well.
Well-matched 3PL companies can provide tremendous value to a shipper’s supply chain. From finding the right carrier for the right shipment, to executing flawless retail deliveries, to helping them comply with government transportation and food safety rules, it’s important to find a service provider that can take logistics burdens away from a shipper so that they can focus on what they do best: developing, manufacturing, and marketing products. To be considered a core carrier, a 3PL must have the infrastructure to manage recurring, dedicated volume across multiple regions.
So how do you choose the right 3PLs for your business? Below are 7 quick tips to help you through your next round of RFPs.
1. Make sure they’ve done it before. Don’t be a guinea pig. Make sure your 3PL has a proven track record in whatever capabilities, specializations, or solutions you require; and check that they have a history of successfully managing dedicated volume at a fixed price for a defined length of time. Ask for case studies or references from existing customers, and take note of how they’ve performed on other, similar-sized accounts in your industry.
2. Look for synergies. Find out if they’re already working with any of your suppliers, customers, or competitors. Knowing that your 3PL companies understand your requirements and have experience picking up or delivering into your facilities makes for an easy transition. Additionally, notice how many of their customers already have freight moving into your geographic locations to determine their capacity strengths near you.
3. Treat a 3PL like a specialty good, not a commodity. Rather than solely looking at price and execution-based services as selection criteria, focus on how a 3PL or broker can bring strategic, value-added operations to your business and reduce your total cost of transportation in the long run. Ask 3PLs in your network how they are different from their competition, and narrow in on those with the execution standards, service offerings, and solutions that align with your company’s goals.
4. Get insight into their operations. Find out exactly how 3PL companies manage both year-round volume and spot shipments. Make sure they have systematic processes in place for selecting carriers, managing drivers, assigning loads, etc.
5. Assess their automation capabilities. Can they actually track and trace your product from pickup to delivery? How are temperatures tracked in real-time and relayed back to you? How much of daily operations are manual and error-prone vs. automated? Technology capability is critical.
6. Focus on FSMA compliance. 3PLs play an important role in complying with the Food Safety Modernization Act (FSMA). Although final wording places the onus on shippers, a 3PL can add value by taking care of documentation, carrier compliance, and trace-ability. When vetting service providers, evaluate their FSMA expertise and find out how they will help you remain compliant.
7. Meet them at their locations if you can. It’s one thing for 3PL companies to tell you how they operate, and it’s another to see their operations in action. If possible, pay a visit to their headquarters and observe how they interact with customers. Pay attention to the day-to-day processes they have in place, ask questions, and get a sense of their culture.
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We specialize in transportation solutions that serve a wide range of customers requiring high-touch service, from big-box retailers to food manufacturers to distributors. Our customers benefit from next-level technology, a national-reaching carrier network that must meet strict compliance standards, and an agile team that’s able to quickly adapt to your unique requirements.
Get in touch with us to find out how we’ve delivered tens of thousands of contracted loads while maintaining 99% on-time performance.