Prepare your Business for a 3PL Partnership
3PL Preparation
Before uniting your organization’s logistics efforts with that of a new third-party logistics provider (3PL), it’s vital that members of your entire company recognize the beneficial—but sometimes big—changes that can take place. There are certain habits your team members must practice after you implement an accompanying transportation management system (TMS), but the first step in allowing structural supply chain additions is partnering with that new 3PL and getting used to the ways in which they help you shake loose negative habits and adopt positive ones. Here’s how you can prepare your team for a 3PL partnership, assuming that the prospective 3PL will provide you with superior technology and services.
- Embrace frequent data collection and allow time for new metrics.
Once your TMS is up and running, it will take some time to obtain the custom contract data required to conduct analytics and obtain a status of your current operations. Your team will need to put in the effort to work with the 3PL in creating a set of KPIs, but you’ll also need to allow time to measure their periodic results. These new metrics can provide you with key insights into various areas of your supply chain, but it’s up to you to learn what they mean and how you can use them to drive efficiency. - Get ready to gain full visibility and witness real carrier performance stats.
Most carriers advertise a misleading rate of on-time pickups and deliveries, and once you introduce a transportation management system into your organization, you’ll witness that false 99% rate drop drastically. That’s because real carrier performance is reflected through your 3PL’s insistence on carrier accountability and accurate reporting. A 3PL dedicated to regular issue resolution for all shipments will find that for most companies, a surprising 15-20% of shipments should have been reported as late and 2-3% as lost or damaged. - Don’t let your team be threatened by automation and new efficiencies.
Many companies lack basic automated processes so much so that when efficiencies via automation are brought in by the adoption of an advanced TMS, it can be intimidating. Faster software and improved accuracy can reduce the workload of certain members of your logistics team. Train individuals to manage larger issues and leave the extra dirty work to your behind-the-scenes logistics partner—your 3PL. Doing this will be a much better use of you team’s time and energy and will allow a renewed focus on success from all angles.
What about my carriers? Will they need to prepare for 3PL changes?
The short answer is yes. Once carriers work with your 3PL to set custom pricing, additional carriers might come with a learning curve; underperformance for the first few months is common because of the late shipments and missed pickups that enhanced visibility naturally brings to light. Carriers will need to take time to readjust or build up their own operating procedures so they can meet a new standard of performance and provide your account the best service possible.
If you need more information on what 3PL and TMS integration entails, schedule a free 30-minute consultation with Translogistics to receive expert feedback on the state of your supply chain and how together these tools serve as a unique total solution.
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