July 2017 | Commentary | 3PL Line

3 Ways Your 3PL Can Help You Overcome E-commerce Challenges

Tags: 3PL, Transportation Management Systems (TMS), Logistics, Third-Party Logistics, Supply Chain

Michael Khalil is Senior Sales Executive, Global Forwarding, C.H. Robinson, 800-323-7587

To meet consumer demands, e-commerce requires adaptable and flexible supply chains, no matter how short the lead time. Companies can support this fast-moving supply chain by leveraging a collaborative 3PL relationship.

By collaborating with a knowledgeable third-party logistics (3PL) provider, shippers can add both scale and visibility to their supply chain. With greater control, companies can improve efficiencies, cut costs, and prepare for the next stage of growth.

Working With Your 3PL

The following three tips can help you leverage a 3PL outsource relationship to overcome e-commerce challenges.

1. Reduce complexity through consolidation. As shippers work with multiple parties, the complexity of the supply chain increases. Each freight movement requires several points of contact as the cargo moves between vendors, providers, and customers.

Consolidation through a 3PL can reduce this complexity. The 3PL offers a single point of contact for all the shipper's vendors and providers. All the freight comes together under one approach, using the same standard operating procedures.

3PL consolidation allows shippers to accommodate small-volume shipping needs, yet make the most efficient use of transportation equipment. This is important, especially because e-commerce results in smaller shipment sizes.

It's not always possible for companies to fill an entire container with their own freight. 3PLs can consolidate freight from many shippers at their facilities. By combining similar destinations, they can make more effective use of transportation equipment and provide savings.

2. Ensure supply chain visibility. Rapid growth—along with smaller shipments coming and going from multiple points—can make it almost impossible for your staff to maintain visibility to what is happening in the supply chain. Successful e-commerce supply chains require a unified technology from beginning to end so the company knows which shipments have been consolidated and where that freight is at all times so they can address customer queries.

Many 3PLs have transportation management systems (TMS) for their clients to use. With a single TMS, shippers can communicate with the 3PL, as well as its vendors, providers, and customers. A TMS also gathers information about the company's freight movements and provides reporting and analysis for improving efficiencies.

3. Tap into local knowledge, global expertise. Many supply chains today have a global component. To remain competitive, companies can leverage a 3PL in strategic regions.

Transportation capabilities and requirements vary widely by region. A 3PL should know the local language, culture, taxes, currency, and regulations, and also understand compliance and global forwarding. In this way, they can help a company navigate markets around the world.

By leveraging a collaborative 3PL outsource relationship, companies can accommodate a fast-moving supply chain and spend time focusing on other strategic areas of their business.