Pros And Cons Of Third Party Logistics

Third party logistics, also known as 3PL, is an important part of many businesses that deal in transportation of goods, warehousing and similar operations.  Setting up a system internally can take up time and resources that most companies don’t have, which is why third party logistics becomes the natural solution.

What Is 3PL?

3PL or third party logistics, refers to assisting companies with warehouse services and solutions, management of transportation of goods, distribution as well as any related technology that will result in cost efficiency.

Pros

3PL offers quite a few benefits to companies that decide to use this type of service.  Perhaps the primary benefits of 3PL are overall savings in cost and in time.  These companies will also realize a higher quality of product shipment and distribution.

Delegating important responsibilities to a third party is always going to save valuable time, and that is certainly the case when it comes to third party logistics.  The fact that you are using a specialized company with expertise in the field means you can also have peace of mind that it is getting done right.

It’s common to think that a company using a 3PL provider will ultimately lose control over its goods during transport, but that isn’t necessarily the case.

The cost savings comes from a 3PL provider managing the entire distribution chain and always selecting optimum routes and means of transportation.  They can also combine several cargos within one vehicle, only charging you for the portion of the vehicle space your products are taking up.

A skilled and experienced 3PL provider will ensure that there is no delay in the distribution of resources and can often offer customized warehouse services to each individual client.

Cons

Naturally, everything is not perfect with the third party logistics system.  If you enlist the services of a third party logistics company that has never worked with products like your before, you may incur some losses at the start.  The company may be skilled an experienced overall, and you may see the gains later on, but those initial losses will still be seen as a negative.

Some businesses will also see handing over possession and losing physical access to their products as a con of the 3PL system.  That is why it is important to look into the company beforehand, and to ensure the method of communication  works for you.  If you feel that you will always have an open line of communication, that loss of product possession may not seem like such a big deal.

Paula Knottingham knows the impact that third party logistics can have on a company. It can help a business become more cost effecient quickly, which will save the business money in the long term. She always trusts 3PL Links for all of her third party logistic needs. They offer a variety of srvices such as supply chain management, warehouse solutions and the best frieght forwarder Toronto has to offer.

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