Every successful relationship with a 3PL is all about choosing the right provider and creating a partnership. That is why the current -and rising- complexity of freight management and technology-driven logistics has businesses of all sizes turning to 3PLs to help them drive efficiency, cost savings, and visibility into their supply chains.
- Set goals and KPIs: Spend time establishing KPIs that make the most sense for your company and communicate them to your 3PL partner. On-time pickup, on-time delivery, tender acceptance or rejection percentages, and EDI compliance are a few examples of typical KPIs.
- Do your research: Thoroughly vet the 3PL before choosing. Ask about their experience and make sure they have a track record of success in your industry.
- Know what you want: To make a good decision, you need to establish your objectives for working with a 3PL and take the time to create a list of “must haves” from company stakeholders.
- Ensure your 3PL uses the latest technology: Freight management is evolving into a technology-driven practice. A good 3PL should be using and creating state-of-the-art TMS technology platforms. Make sure your 3PL’s technology can integrate with your business systems, provides real-time visibility, and predictive analytics to help you make strategic decisions. Request a demo of their technology so you can see all the capabilities and how it works.
- Treat your 3PL as a business partner: Consider your 3PL an extension of your team, and make sure they can scale their operations to enable your growth plans.
- Know their financial status: Align with a 3PL who has significant growth histories and plans. Make sure any business you partner with has staying power and the resources to support you.
- Make certain the 3PL meets your needs: Use a checklist to confirm that your 3PL offers what you need now and in the future. Ensure they provide the modes of transportation you need, technology that will help you gain operational efficiency, and support teams that will be accountable to your business objectives.
- Plan for new markets: Choose a 3PL robust enough to support your growth plans. Make sure their capabilities can expand with you into new geographic regions and/or product lines.
- Create accountability: It’s important to not only establish realistic KPIs, but also hold meetings with your 3PL to ensure you’re on track to meet your business goals. A good 3PL will provide quarterly business reviews and updates on KPI tracking.
- Know your support team: You’ll be working closely day-in and day-out with your 3PL. Make sure you have a dedicated team that’s easy to work with and has depth and expertise. Get to know their process and how you will interact with them.
If you liked this article, please comment and share.