The first challenge any ecommerce start-up is to survive its initial years in competitive world of the business industry. But from there, things don’t get any lighter. As a company grows, internal and external concerns emerge one after another. And the most daunting of them is the challenge to meet supply chain demand.
To deal with this dilemma, a lot of companies started turning to 3PL organizations for their reliable ecommerce fulfillment services. This solution proved effective for many businesses since working with a 3PL company yielded benefits like:
1. Overhead Cost Reduction
3PL providers have their own network of resources. Because of this, business owners don’t have to worry about building or leasing warehouses, hiring manpower, arranging transportation, and the like. There’s no need to allocate money and resources on paperwork, staffing, billing, auditing, and many more. Without the obligation to spend for these, companies get to cut costs resulting in lower overhead expenses.
2. Progressive Internalization
3PL companies specialize in logistics operation and management. This means that they are experts in handling all functions of logistics, which include inventory management and planning, packaging and storage, transportation, and customer service. Even without supervision, 3PL providers will definitely yield reliable results. Thus, proprietors are given the confidence and time to focus on the core competencies and improve internal management instead.
3. Market Expansion
Working with a 3PL organization grants access to all of its resources and warehouses. This can be helpful when expanding to a new geographic market since the supply chain can easily be positioned and transported to other regions and countries. Aside from cutting costs in warehousing, shipping to places where company presence hasn’t been established will be a lot easier.
4. Resource Network Leverage
3PL companies have a vast network of resources at their disposal. Furthermore, these resources are stationed strategically to make distribution and transportation effortless. When working with a 3PL provider, companies are given the privilege to have access to all of their assets as well. In a way, this can be used as a leverage over competitors.
5. Scalable Services
3PL organizations are perfectly capable of meeting escalating demand for supply chain. They have the ability to adjust labor, transportation, and storage space according to the size of your inventory. They can also easily adapt to fluctuating demands that come with new product releases and seasonal bargains.
6. Supply Chain Optimization
Hiring a 3PL provider can help optimize supply chain operations through efficient and effective strategies. Aside from tangible resources, 3PL companies have other types of resources that can enhance logistics practices and functions. These come in the form of supply chain software solutions that 3PL organizations use. They can help analyze, monitor, and optimize end-to-end logistics and supply chain processes by eliminating errors and inefficiencies.
Why Should You Hire Third-party Logistics?
Many companies seem to believe that handling logistics management and supply chain demand on their own can save more money. But if you think about it carefully, taking matters in your own hands can do more harm than good. Because you have to establish your own resources, you will have to pour more money on operational costs. Not only that, there are risks of blunders that may add to the scaling amount of money and resources you’re devoting to it. There’s going to be a lot of room for errors, and as a business owner, you should know that it’s not smart to invest in a risky expenditure like that.
This is exactly why hiring a 3PL provider is better. Aside from the bountiful benefits that come with it, you’re guaranteed a worry-free partnership that opens doors of opportunities for growth and success.
