The Pros Of Using A Third Party Logistics Company For Your Business | Rockstate of Mind
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3PL - 3rd Party Logistics acronym business concept

The Pros Of Using A Third Party Logistics Company For Your Business

Third party logistics companies are essentially a variety of services and processes put together which are provided to a business in order to assist them in their operation. There are variety of reasons why a business would go through a reliable 3PL warehouse, as they provide many benefits in numerous aspects of the business. These companies are generally more suited to specific aspects of a business and will work with singular to multiple aspects of a business. However, sometimes they are hired to take over an entire operation. They will often work with companies on a short-term basis to help achieve specific set goals and objectives, and sometimes they will work with businesses in the long-term and provide solutions for the future.
It is obvious to see that 3PL warehouses offer numerous benefits, however they also can bring some disadvantages.

Here are the pros and cons of 3PL warehouses.

Access to expertise

Because of its wide array of experience, a 3PL warehouse will have employees, processes and technologies that are far beyond what an independent company could ever have. A third party logistics provider will have a primary focus on the supply chain and distribution management.
It is therefore understandable that they will have a lot of experience in this field and only this field, but including all aspects that are encompassed within them. An independent business will have other areas to focus on, and many businesses are not very strong in the distribution management aspect of business. A 3PL warehouse is able to take over aspects or entire operations of a business, and will run it using their expertise. Going through a provider ensures that you will have the knowledge to do so well and will be able to make smart decisions that will impact the efficiency and effectiveness of your business operation.

Access to technology

Female worker scanning package with barcode scanner while using digital tablet in freight and distribution warehouse.

One of the biggest advantages of going through a 3PL warehouse is the fact that you will have access to the latest technology in supply chain management and distribution. Companies rely heavily on IT-based services in order to run a supply chain operation, and IT applications are an industry standard across the world. These applications are integrated with customer systems and provide a mix of cloud-based and commercial solutions.
This is a powerful technology stack that boosts efficiency and effectiveness of the supply chain operation significantly. So, it is completely understandable that 3PL warehouse, who will have the latest technology to do with supply chain management and distribution, will make your business efficient and effective in its operation through the use of technology.

Cost reduction

With increased visibility in the supply chain, the organization and operation of the business will be much smoother. As a result of this, the business will be able to react faster to incoming orders for products, and send out orders faster than before. This results in more orders going out faster and an increased cash flow as a result. In addition to this, 3PL warehouses will provide a variety of different services that cover all aspects of the supply chain and distribution operation. By using them, you reduce the need for outsourcing warehousing, transportation, etc. which in turn will save you costs.

In summary, 3PL warehouses can provide numerous benefits to a business. You gain access to expertise to do with supply chain management and distribution, you gain access to the latest technologies and you reduce costs associated with the business operation.

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