fin-a3pl

It's Not Me It's You...Saying Goodbye to Your 3PL

andrewc@omnigrowth.com.au (Andrew Carroll) — Mon, 22 May 2023 12:05:57 GMT

Moving 3PLs is not a decision that should be taken lightly however it is one that many businesses make as the cost to stay is so high: often for both commercial and emotional reasons.

Before informing your current 3PL that you're moving on, there are a number of key things you should do:

Review Contractual obligations : Review your contract with the 3PL (Third-Party Logistics) provider to understand any terms and conditions related to termination or notice periods. Ensure that you comply with the contractual requirements to avoid any legal issues.

Review Service performance : Evaluate the overall performance of the 3PL in terms of service quality, reliability, and responsiveness. Consider factors such as on-time deliveries, order accuracy, customer complaints, and communication effectiveness. Identify any persistent issues or areas of improvement that have not been adequately addressed.

Source an Alternative 3PL : This is an important step and can be done in a very confidential manner to avoid your current 3PL finding out you are getting quotes. This is where Find a 3PL can assist or for more assisted sourcing of a 3PL you could use Andrew at www.omnigrowth.com.au

Transition planning : Develop a comprehensive plan for transitioning from the current 3PL to a new provider or an in-house logistics operation. Define the timeline, roles and responsibilities, data migration process, and necessary communication channels. Minimize disruptions to your supply chain during the transition and ensure a smooth handover of responsibilities.

Inform your Customers : customers are very understanding as long as you don't surprise them in a negative way. Ensure you let them know that there may be some delays as you transition warehouses. Most won't mind and you can manage the exceptions manually.

Monitor the Pack Up : Unfortunately a lot of 3PLs don't show a lot of care when packing up an ex-customers products. This can lead to delays inbounding stock at the new 3PL as well as higher costs. It's important that you not only have a transition plan but that you ensure the 3PL adheres to your agreed expectations.

Remember, this is a general list of considerations, and the specific circumstances of your business and relationship with the 3PL may require additional or different factors to be taken into account.

Questions When Choosing a New 3PL

andrewc@omnigrowth.com.au (Andrew Carroll) — Mon, 15 May 2023 23:00:15 GMT

A Few Handy Questions to Ask Your Next 3PL

When considering partnering with a third-party logistics (3PL) provider, it's important to ask the right questions to ensure they can meet your business's needs. Here are some essential questions to ask when talking to a 3PL:

What services do you offer?

Determine if their services align with your specific logistics requirements, such as transportation, warehousing, inventory management, order fulfillment, etc.

What industries do you specialize in?

Check if they have experience working with businesses similar to yours. Industry-specific expertise can be beneficial in understanding unique challenges and requirements.

What is your geographic coverage?

Ensure that the 3PL can support your operations in the regions where you operate or intend to expand. Ask about their network of warehouses, transportation capabilities, and international reach.

What technology and systems do you use?

Inquire about the technology infrastructure the 3PL utilizes, such as warehouse management systems, transportation management systems, and integration capabilities with your own systems. Compatibility and efficiency are crucial for smooth operations.

What are your performance metrics and how do you measure them?

Understand how the 3PL measures and tracks their performance. Key performance indicators (KPIs) such as on-time delivery, order accuracy, and inventory accuracy are essential to ensure they can meet your service level expectations.

What are your security measures?

Assess the security protocols the 3PL has in place to protect your products, data, and intellectual property. Inquire about their security systems, staff training, and certifications such as ISO 9001 or C-TPAT (Customs-Trade Partnership Against Terrorism).

How do you handle returns and reverse logistics?

If product returns are a significant aspect of your business, ask about the 3PL's capabilities and processes for managing reverse logistics, including returns processing, refurbishment, and disposal.

What is your pricing structure?

Understand how the 3PL charges for their services. Inquire about service fees, transportation costs, warehousing fees, and any additional charges for value-added services. Clarify if their pricing is fixed, variable, or based on a customized agreement.

Can you provide references or case studies?

Request references from current or previous clients who can provide insights into their experience with the 3PL. Case studies or success stories can also help demonstrate the provider's capabilities and track record.

How do you handle scalability and flexibility?

Assess the 3PL's ability to accommodate your business's changing needs, such as seasonal fluctuations or unexpected growth. Inquire about their capacity, scalability options, and any potential limitations or additional costs associated with adjusting service levels.

Remember, these questions serve as a starting point. Tailor them to your specific business requirements and challenges to gather the most relevant information and make an informed decision about the right 3PL partner for your organisation.

The Costs of Using a Third Party Logistics (3PL) Warehouse

andrewc@omnigrowth.com.au (Andrew Carroll) — Mon, 15 May 2023 07:50:26 GMT

3PL Costs for Fulfilment

As businesses grow, they often reach a point where it becomes necessary to outsource some or all of their logistics operations to a third-party logistics (3PL) provider. While there are many benefits to using a 3PL, such as increased efficiency and reduced labor costs, there are also some significant costs that should be taken into account. In this article, we will explore the costs associated with using a 3PL.

Inbound Costs

This is the cost for the warehouse to inbound your stock and put it away to a location. The cost depends on who your product arrives at the warehouse. Some warehouses will simply charge a per hour rate to inbound your stock, while others will charge by the way it comes in: container, pallet, carton or unit.

Where possible, it is always less expensive to bring in a single SKU pallet or carton, than one containing multiple SKUs. The most expensive way to bring in stock is if there are multiple SKUs in a carton as that requires the warehouse to open up each carton and count each unit.

Storage Costs

While Amazon charge on a cubic metre basis for storage, most 3PLs will charge based on the space you use by pallet, shelf or pick face. While tis may seem risky if they spread your product out, it is in the 3PLs interest to minimise the space you take up so they can fit more retailers in.

Pick/Pack Costs

Most 3PLs will charge a base fee per order and then a pick fee per unit in that order. Some 3PLs wil also charge for each different SKU in an order.

Packaging Costs

Some 3PLs will charge to label a carton or satchel while others won't. You can either bring your own packaging or use theirs. If you bring your own, the 3PL will usually charge to store it. If you use theirs, they will often just charge on a cost+ basis.

Most 3PLs will allow you to add a flyer at no or a very small additional cost.

Kitting Only if requested)

If you require the 3PL to make up a special pack or bundle, this is called kitting. Most 3PLs ill start by charging on a per hour basis for this work until they have a good idea on average how long it takes. They may then offer to charge on a per bundle basis.

Integration Costs

When a company first starts working with a 3PL, there may be some integration costs to consider. For example, the company may need to purchase new software or hardware to integrate with the 3PL's systems. There may also be costs associated with training employees on the new systems and processes.

Freight Carrier Costs

Transportation costs are another significant cost to consider when using a 3PL. The 3PL will typically handle transportation for the company, which can include shipping, freight forwarding, and customs clearance. The cost of transportation will depend on the distance goods need to travel, the mode of transportation used, and the weight and volume of the goods.

Opportunity Costs

One cost that is often overlooked when using a 3PL is the opportunity cost of not handling logistics in-house. By outsourcing logistics, a company is able to focus on its core competencies and free up resources that can be used elsewhere in the business. However, there is a potential cost associated with not having direct control over logistics, such as the ability to quickly respond to changes in customer demand or market conditions.

Risk Costs

Finally, there are risk costs associated with using a 3PL. These can include the risk of damage or loss of goods during transportation, the risk of theft or fraud, and the risk of reputational damage if the 3PL fails to meet customer expectations. While these risks can be mitigated through proper due diligence and risk management practices, they are still a cost that should be taken into account.

While at first glance, it can seem there are a lot of costs to outsourcing your fulfilment, many retailers find once they have received quotes that it is more cost effective for their business than their current fulfilment approach.

If you'd like to see whether a 3PL is right for your business, please feel free to complete the briefing questions and we will provide you with proposals from a range of reliable 3PLs.

Why Outsource to a Third Party Logistics (3PL) Warehouse

andrewc@omnigrowth.com.au (Andrew Carroll) — Tue, 23 Aug 2022 13:23:18 GMT

Retailers face numerous challenges in their daily operations, from managing inventory and order fulfillment to ensuring timely delivery and customer satisfaction. One solution that has become increasingly popular is to outsource logistics and supply chain management to a third-party logistics (3PL) provider. In this blog post, we will discuss the benefits of using a 3PL for retailers.

Cost savings

One of the primary benefits of using a 3PL is cost savings. By outsourcing logistics and supply chain management, retailers can save money on warehousing, transportation, and labor costs. A 3PL provider can leverage its expertise, infrastructure, and economies of scale to streamline operations and reduce costs for its clients. This allows retailers to focus on their core business and invest resources in growth and expansion.

Scalability and flexibility

Another advantage of using a 3PL is scalability and flexibility. A 3PL provider can adjust its services based on the needs of the retailer, whether it's handling peak-season demand, expanding into new markets, or responding to unexpected disruptions. A 3PL can also offer a range of services, such as inventory management, order processing, and transportation, which can be customized to meet the unique requirements of each retailer.

Improved operational efficiency

A 3PL can help retailers improve operational efficiency by leveraging technology and best practices to optimize processes and reduce lead times. For example, a 3PL can use automation and data analytics to improve inventory accuracy, reduce order processing times, and enhance delivery performance. This can lead to faster turnaround times, improved customer satisfaction, and a competitive edge in the marketplace.

Access to expertise and resources

Using a 3PL can also provide retailers with access to expertise and resources that may not be available in-house. A 3PL provider can bring industry knowledge, experience, and best practices to help retailers improve their supply chain operations. Additionally, a 3PL can provide access to a network of carriers, warehouses, and other logistics providers, which can help retailers expand their reach and improve their supply chain resilience.

Risk management

Finally, using a 3PL can help retailers mitigate supply chain risks. A 3PL can help retailers navigate regulatory compliance, manage supplier relationships, and ensure product safety and quality. Additionally, a 3PL can provide visibility and transparency into the supply chain, which can help retailers identify and address potential disruptions before they occur.

In conclusion, using a 3PL can provide numerous benefits for retailers, including cost savings, scalability and flexibility, improved operational efficiency, access to expertise and resources, and risk management. By outsourcing logistics and supply chain management, retailers can focus on their core business and improve their competitiveness in the marketplace.