Leveraging 3PLs to Ease COVID Business Growing Pains
As the COVID-19 pandemic swept the nation, a second and unexpected problem emerged along with it: A shortage of toilet paper.
Panic-buying and hoarding left store shelves empty. New deliveries routinely were sold out within minutes. And toilet paper manufacturers, who had long ago leaned out their operations in an effort to maximize profit, found themselves in an unforeseen predicament.
Following manufacturing industry trends, bath tissue-producing facilities had inventory stuck in various stages of their supply chains—and little of it was reaching the marketplace as quickly as consumers were buying it.
In the months following, manufacturing companies across a range of industries have faced similar issues. In some cases, business slowed while in others, it ramped up considerably. But for everyone, typical buying forecasts and production schedules were in flux as they attempted to find footing in a new, unprecedented marketplace.
Looking ahead, those same companies have decisions to make. Do they adjust their inventory control systems? Make capital investments to allow for greater production capacity? Or do they back away from the just-in-time manufacturing that caused them to run such lean operations to begin with?
One option that’s gaining popularity is utilizing third-party logistics (3PL) suppliers to move and transport excess raw material or finished goods. The ease, flexibility, and low initial investment of this option has made it a popular choice during uncertain times.
Unlike anything before it, the COVID era has proven manufacturing’s need for 3PL services. The industry is facing challenges that are so new and unique, each company is left reinventing its own wheel.
That’s where a 3PL supplier offers such a distinct advantage. Working with a number of companies gives suppliers a bird’s eye view of best practices, combined with longstanding expertise on proven supply chain methods.
Third party logistics suppliers also have the bandwidth to solve problems, so manufacturers don’t have to. The manufacturing industry has faced insurmountable odds during the past year. From shutdowns and outbreaks to expensive new safety protocols, few operations have managed to maintain business as usual. In the midst of this, supply chain congestion and warehousing needs are issues that can—and often should—be more effectively managed offsite.
Here at TexAmericas Center, we added third party logistics to our menu of business services during 2020. We knew that we could add value for our customers by delivering high-quality logistics services at a low cost to our extensive transportation network. We now support our customers’ rail, warehouse, distribution, and logistics needs through storage, switching, and movement services.
We hang our hats on customizable solutions at TAC, and that flexibility has been critical this year. We’re seeing a dramatic increase in demand for rail access and cold storage and expect to see more companies turn to smaller fulfillment centers. We’ve been able to make those adjustments easily for our customer base, whose needs sometimes change from day to day.
Indeed, flexibility will continue to be a major component for success for companies operating through COVID changes. Making the decision to outsource third party logistics for warehousing, supply chain and distribution needs will allow companies to focus on their core business strengths. A good third-party provider will lower your overhead, reduce inventory, standardize production goals, and increase efficiency.
There’s no doubt: the COVID-19 pandemic has forced companies to pivot operations in order to survive. It has increased the demand for more robust and responsive logistics, with more consumers and businesses expecting just-in-time delivery or products shipped directly to their front doors. Companies who respond well to these challenges will undoubtedly see long-term profitability boosts. The rewards are yours for the taking.