3PL Outsourcing
Over the past 20 years, many companies have outsourced some or all of their physical distribution functions to third party logistics companies (3PLs). Even firms that consider logistics a key competency have outsourced niche portions of their logistics activities.
Reasons for outsourcing to a 3PL include:
- Reduce supply chain costs by availing of these 3PL attributes:
- Lean logistics philosophy
- Supply chain optimization applications and expertise
- Network restructuring capability
- Convert from fixed to variable cost structure
- Shed assets
- Improve service
- Allow a firm to focus on core competencies, and hand over logistics to outside experts
- Utilize state-of-the-art logistics execution technology
- Leverage a large transportation spend
- Benefit from knowledge of best practices
- In your industry
- Across industries
- Support growth into new regions
