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West Coast and California Logistics Blog

Finding the Right 3PL Provider: Is Your Growth Journey a Logistics Dream or Nightmare?

Thu, May 17, 2018 @ 10:19 AM / by Arlene M. Slivka

It was a great day for your business – Costco agreed to carry your product, both in stores and online. Awesome!  

Your team worked hard for this deal and, after the celebration, you went home for some much-needed rest before starting to tackle this great new opportunity the next day with your current third party logistics partner (3PL).

That night, a vivid dream transports you to your desk the following morning. You call your 3PL provider to begin discussing a rapid ramp-up process for planned volume increases. But instead of excitement about the new opportunity, your 3PL instead expresses concern and tempers your expectations about what can be done and how fast.

You’re shocked that your partner isn’t as excited as you are about the 15-20% growth this means for both of your companies. And you’re worried about telling your CEO that the time frame for project start-up won’t meet your new customer’s expectations.   

Just then you jolt upright in a cold sweat – what a nightmare!  The next day doesn’t come soon enough. You place that critical call to your 3PL partner and are relieved to learn…

“We need only 1–2 weeks to setup and test the systems integration”

3pl provider

Systems integration issues can really derail start-up operations with a new retail customer.  Providers with an in-house IT team – including EDI programming capabilities – can shorten the lead-up to “GO LIVE.”  When such providers are also retail logistics experts, it’s likely that they have already performed this or a similar integration with the retailer and can avoid the coordination of outsourced IT vendors.  This can reduce the time frame for system integration from 2 months to 2 weeks.

Aside from the system integration time factor, vendor compliance expertise will simplify the setup and ensure your shipments meet routing guide requirements, compliant labeling, and all the other disciplines required for today’s retail distribution.

“We can manage the labor spike in a variety of ways”

Business spikes are not just a holiday event.  Daily deals, marketing promotions, and TV shows like Shark Tank affect volumes throughout the year.  Staffing flexibility is a distinguishing value many 3PLs provide through:

  • Campus warehouse set-ups, where experienced staff can be shared among multiple warehouses in close proximity
  • Strong relationships with staffing agencies that allow fast access to experienced warehouse workers
  • The willingness and ability to add shifts, as needed

A good 3PL partner will be expert at using its robust WMS to take advantage of peak period economies of scale.  When there are huge spikes for a specific SKU, the warehouse management system can calculate the bulk equivalent of item quantities to batch pick items – effectively skipping the pick line entirely to speed outbound shipping.

A 3PL that can flex transportation capacity is critical, as well.  For example, let’s say your drayage operation, which has averaged around 20 containers monthly, now needs to ramp up to 75+ – and fast.  An agile 3PL provider can immediately leverage partner providers, temporary drivers and additional equipment to address this spike.  3PLs like Weber Logistics that perform warehousing services for drayage customers can also carefully manage last-free-day status with the warehouse ship schedule to avoid fees and reduce chassis costs. 

“We have some options on the space too”

In the nightmare scenario, your 3PL provider is focused on filling its existing warehouse space.  It is very happy that you occupy – and pay for – your current space but may not be able to accommodate fast expansion, especially if your growth is driving two- or three-times as much space – this fall!

In contrast, outsourcing logistics operations to an agile 3PL can counter this nightmare with a dream solution that quickly identifies and upfits new space.  To do this effectively, it helps to have a very strong knowledge and presence in the local real estate market and close relationships with industrial real estate firms. A 3PL can leverage these advantages to build out and occupy a new location within a couple of months.  Smaller 3PLs may not have the wherewithal to make this happen and the largest 3PLs would be wrapped up in red tape for the better part of 6 months before getting the green light.    

Is your 3PL willing to support your growth?

When it comes to your supply chain, is your current 3PL the things dreams are made of?

If your business’s growth is dependent on having a scalable distribution infrastructure, you need 3PL partners that are both willing and able to flex operations quickly to support business changes. 

Contact Weber Logistics today and see how easy it is to wake up from any logistics nightmares you may currently be having.   

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Topics: 3PL, 3PL Outsourcing, 3pl contracts

Written by Arlene M. Slivka

Director – Solutions Engineering

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