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As of 2014, 80% of all Fortune 500 companies and 96 percent of Fortune 100 used some form of 3PL services.

A 3PL(Third-party logistics) provider can help you efficiently increase your business’s reach by allowing you to leverage their resources to fulfill your business objectives. If you are looking for reasons why you should use a 3PL, here are our top 10 reasons.

Click here if you want to learn more about what 3PLs are.

Table of Contents

10 Reasons To Use a 3PL

Cost Savings

The cost savings of hiring a 3PL are unmatched in terms of time and money. First, using these providers eliminates your need for leasing warehouse space and paying for other overhead costs such as transportation, technology, and staff to perform logistics tasks. Yet, furthermore, 3PLs can prevent your company from making costly mistakes and help build a worldwide global logistical network that increases return and lowers risk.

The cost savings of using a 3PL doesn’t stop there, though. Since third-party logistics providers specialize in these services, partnering with one can allow you to tap into their extensive network of industry partners such as shipping carriers. In turn, you receive their shipping discounts and may even be able to offer further volume discounts. You can look at the prices of various major 3PL’s by clicking here.

 

Time Savings

As we briefly mentioned, hiring a third-party logistics provider also offers considerable time savings. If you stop to think for a moment, you’ll realize that you spend a great deal of time focusing on managing and optimizing your business strategies; which is where your attention is best kept. However, when you’re strategizing and making moves, the last thing you should have to worry about is taking on a full workload.

This is where a 3PL comes in and essentially shoulders all of your responsibilities so that you can remain focused on growth, core competencies, and so on. The point is that you really can’t go wrong hiring a 3PL to save time and money. In fact, their expertise may be what keeps you from making costly shipping mistakes that will waste even more of your resources and time.

 

Direct Access to Expertise

In today’s complex global market environment, it’s challenging to accommodate and anticipate the internal expertise required for all regions and capacities. If your company is struggling with this, then partnering with a 3PL is an excellent option. Not only do these companies have proficiency and experience with matters such as export and import, but also with compliance regulations, transport documentation, and more.

Any business looking to expand into international markets will benefit from the vast support and know-how that a 3PL will provide. In the long run, this reduces cycle time, helps entry into a new market go smoother, and minimizes costly delays.

 

No need to hire people or purchase infrastructure

Since working with a 3PL allows you to leverage their resources, this frees you up from having to invest in purchasing infrastructure, equipment, or having to hire and train people to properly manage your operations. A 3PL also safeguards you from any costly mistakes during the implementation of these processes that might prove to be fatal for smaller or uninsured businesses. Click here if you want to read more about the best warehousing options for eCommerce companies.

Since working with a 3PL allows you to leverage their resources, this frees you up from having to invest in purchasing infrastructure, equipment, or having to hire and train people to properly manage your operations.

Continuous optimization with best industry practices

3PL’s are constantly optimizing their processes for efficiency and follow best industry practices in the supply chain industry, which allows them to minimize shipping mistakes, decrease shipping times, and increase overall customer satisfaction.

Direct access to a 3PL’s vast resources

Working with a 3PL allows your business to leverage their resources(Warehouses, labor, technology, equipment, and so forth) for your business’s needs without having to make investments towards purchasing these resources yourself.

Provides Scalability & Flexibility

Another considerable advantage of signing up for 3PL services is that they allow you to effectively scale space, labor, and transportation to your company’s unique needs. Even seasonal businesses benefit significantly from third-party logistics providers in terms of transitioning between low and high seasons while also allowing them the ability to utilize more logistical resources and warehouse space when needed.

Perhaps the best part of partnering with a 3PL is that it better enables your company to grow into new regions with fewer entry barriers. As your business scales up, a 3PL will help you scale effectively, as they offer the perfect capabilities and resources needed to enter new regions and markets seamlessly.

 

Improved Customer Satisfaction

As you can see, hiring a 3PL frees up a lot of time for a business owner. And more free time means that you can focus on improved customer response and service time to ensure everyone receives nothing but the best service. Ultimately, timely service and delivery translate to better brand reliability, which leads to improved customer satisfaction rates. Every business owner knows this is the primary, fundamental goal of every company, and it’s that easy with the help of a 3PL.

 Optimize your business with a bird’s eye view of all processes

 Have you ever wanted to have a bird’s-eye view over all of your company’s operations so you can pinpoint with high accuracy where your business can improve? Working with a 3PL provides exactly that, a one-stop-shop for all your supply chain needs with a single online portal where you can access all the logistical information regarding your business. This helps you to consolidate a large portion of your business and lets you focus on parts of your business that matter most.

Data collection

A good 3PL will provide you with data that is essential to your business, such as what holidays are the busiest for your business so you can gear up and be better prepared for them. Having access to such data is one of the biggest assets a modern company can have and it can allow you to have an advantage over your competition. 3PLs also use this data themselves and analyze it to create better logistical solutions which result in improved customer satisfaction.

Not All 3PL's are Created Equal

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