What Can 3PLs Do?
Can third-party logistics (3PL) providers bring chaos to order? Or order to chaos? For starters, they can help you wrangle and bring some order to the current COVID-caused confusion in your logistics process.
We’ve been reporting on how logistics partners can help you solve complicated business challenges and leverage opportunities long before “3PL” was a globally recognized business term. A look back shows what we reported in our first annual 3PL edition in July 1996: “Almost every American company has downsized, restructured, reengineered,” said Charles Lounsbury, vice president, recycling equipment division, Toro. “They have become ‘lean organizations’ and, as such, are turning to third parties to leverage their own scarce resources and improve their asset utilization.”
What Lounsbury said 25 years ago could have been said yesterday. More firms than ever are shopping for contract logistics services. It’s likely more true now than it was a quarter of a century ago, given the current chaos.
In 2003, we examined how gyroscopic versus radar operational approaches impact the vision of 3PLs. When stressed by economic realities, we wrote, “Do 3PLs navigate their way to survival by bouncing off you, their customers (radar)? Or do they stay true to their gyroscope, their core expertise…as a way to outflank economic privation…thus becoming a long-term partner to their customers by focusing on solutions they know well?” True then and more so now. Stick with a partner that knows its core competency and has invested to keep up with the times.
A few years later, we focused on 3PLs’ dedication to the importance of “the customer is king.” Not just a dedication to you as their customer, but also to your customers. Demand-driven logistics is no longer an outlier business practice; it’s now critical to enterprise survival. Ally with providers who understand that serving your needs really means serving your customers’ demands and helping you evolve into a demand-driven enterprise.
Fast forward to July 2011. We asked this question (especially important today): “Are you getting your money’s worth from your logistics solutions provider?” The survey results in our 3PL Perspectives 2020 article show that question is still topical, and the point it raises reveals that many are not getting full value from their 3PL partners. Understandably, it has been a long-term struggle between transactional use to save transport costs and strategic relationships that drive enterprise change. Economic stress favors the former; enterprise survival favors the latter.
One decade later, this edition addresses many of the same points. So what can 3PLs do? The content in this edition will help you master the variables thrown your way and transform business chaos into opportunity when you have the right partners.