Home – New Forums Logistics Chosing a 3PL- when the time is right, you will know

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  • #990865
    Matt @NMM
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    Hi FS
    I recently submitted an article in a local B2B magazine and thought there may be some valid points worth sharing around the topic of third party providers…

    Engaging a 3PL company can be a daunting task resulting in sleepless nights at the thought of someone else controlling your products & orders!!

    Here are some basic questions I consider a Checklist for your business when you reach the point where growth outweighs the hours in your day & I included a few of the generic benefits to consider in the overall picture.

    Key points when considering outsourcing to a 3PL Provider?
    • Are my own facilities and resources able to cope with volumes as they increase?
    • Do I have enough time to do everything – do I want to do everything?
    • Will I retain visibility and control of my business if I outsource?
    • Does the 3PL provider offer flexibility and personal service (responsive to abnormal situations; prepared to discuss variations;able to adapt to changing business directions)?
    • What systems are in place and can they be integrated with my business (not the other way around)?
    • Can they prove capacity and capability in the industry (testimonials and references)?
    • Experience – do they understand my product/market and care about my business?
    • Can they give me independent and objective advice?
    • Are the defined operating costs easily understood, outlining both
    Fixed and Variable costs according to the business needs?

    With cost a critical component of any business, ask yourself, does
    the 3PL provider offer a value service or just the “cheapest” price?

    How can my business benefit from a 3PL Provider ?
    • Flexibility for growth and manage risk to cover unexpected events
    (staff leave/sickness; seasonal sales fluctuations; ad hoc events) and
    minimise your fixed overheads;
    • Optimal purchasing and inventory strategies to meet demand, reduce excess and limit stock outs;
    • Access to skilled logistics professionals, fulfilment machinery, established warehouse facilities and integrated systems;
    • Enhanced customer service capabilities and diverse service offerings
    (personalised branding opportunities);
    • Improved distribution options through exposure to a broader transit
    network and access to lower prices through economies of scale; and
    • Frees your time to concentrate on selling, marketing and growing
    your business.

    #1178886
    LucasArthur
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    Hi

    This appears to be great info, although am i missing something? what answers should we be looking for? or are you trying to illicit contact re your services..

    Appreciate info

    Jason

    Jason Ramage | Lucas Arthur Pty Ltd | E: [email protected]   P: 61 3 8324 0344    M: 61 412 244 888
    #1178887
    Matt @NMM
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    • Total posts: 45
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    Hi Jason

    The intent of the info/ questions i wrote is to incite some thought outside the cost & $$ associated when looking into 3PL, external Pick pack fulfillment, warehousing.
    While i understand cost is always a significant factor- there is a much larger picture- that being the relationship that is to be formed & levels of comfort as ultimately you want someone to conduct activities exactly as you would have done yourself.
    Some of the questions ( only you the business can answer) are thought provocative, in relation to establishing trust, communication & reliability between provider and your business. If you can feel comfortable and say yes to some of the questions, then your business relationship is off to a great start.
    Many ‘providers’ are just filling space which converts to money. Not all though- the relationship and communication of expectations is key.

    SimplyReplica, post: 208535 wrote:
    Hi

    This appears to be great info, although am i missing something? what answers should we be looking for? or are you trying to illicit contact re your services..

    Appreciate info

    Jason

    #1178888
    LucasArthur
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    Matt @NMM, post: 208539 wrote:
    Hi Jason

    The intent of the info/ questions i wrote is to incite some thought outside the cost & $$ associated when looking into 3PL, external Pick pack fulfillment, warehousing.
    While i understand cost is always a significant factor- there is a much larger picture- that being the relationship that is to be formed & levels of comfort as ultimately you want someone to conduct activities exactly as you would have done yourself.
    Some of the questions ( only you the business can answer) are thought provocative, in relation to establishing trust, communication & reliability between provider and your business. If you can feel comfortable and say yes to some of the questions, then your business relationship is off to a great start.
    Many ‘providers’ are just filling space which converts to money. Not all though- the relationship and communication of expectations is key.

    Hi Matt (sorry was on mobile before and was hard to see your name)

    Appreciate the reply, i am short sometimes :), although i was not querying ‘price’ although i can see how this type of service warrants price conversation as it appears to be quite daunting and rather compartmentalised in the pricing structures.. Eg; pick this+$, post this +$, fork this +$, send invoice +$, etc etc…

    Being someone that has been looking into this over the last week or 2, with little replies that make sense (and i am being reasonable as well just couple queries), i found your questions provocative although a bit like going to a fancy restaurant and still left me a little hungry as if i had missed the main course.

    Meaning, your questions are awesome to ask although not knowing enough about 3PL and other providers they could be making one look good as the questions are posed directly at them or similar and make others look like crooks (when not)… Not saying you did this, just questions can stack either way :(

    In fact, rereading the questions is making me look into it much harder to see if i can answer them and even understand them myself which is a positive i bet.. LOL.. and take your point about whether the party i (we) call is even willing to listen and respond would be a great start..

    Gonna re visit your site.. see if i can tick the questions off, oops, and may have some questions for you as i dont really know a great deal about 3PL and am getting really annoyed with researching the viability of it at the moment (irrespective of pricing)..

    Cheers
    Jason

    Jason Ramage | Lucas Arthur Pty Ltd | E: [email protected]   P: 61 3 8324 0344    M: 61 412 244 888
    #1178889
    Matt @NMM
    Member
    • Total posts: 45
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    Got you thinking- that’s a good start. 3PL’s are often seen as crooks ( as you point out) but i think largely, they too are trying to understand what it is that is require for the online/ecommerce space and how to translate that to an operations process. Online retail space is something many transport and 3PL companies were naive to & not ready for the quick growth of it.
    I myself am an operations manager for a multi user warehouse where each of our 40+ clients all expect something different to the other- no two are the same and can be complicated at times.

    I am far from being a salesman!!and joined FS out curiosity of the online market space- so feel free to drop me a line and i will do my best to share some knowledge.
    I have worked in the logistics arena for one of the multi national big boys ( who have a huge sales team) and also the smaller owner operator ( who don’t generally have a sales person at all) and have taken with me a little from both columns :) to forge a blend of middle ground. Big enough to invest in opportunities, small enough to be flexible..

    #1178890
    Greatfreight
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    • Total posts: 1
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    Hi Jason
    Our company is also a 3PL with 30 years of experience. In fact we were one of the first “freight brokers” to recognise the niche. Still around and promise we are not crooks!
    Check us out on http://www.freightpeople.com.au and feel free to give us a call to discuss your transport.
    Cheers
    Matt

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