We think of a supply chain as the sequence in which a commodity is produced and distributed. Logistics is a part of that supply chain increasingly being given to a 3rd party logistics company (3PL), to accomplish.
There comes a time when a business asks the question; what would the benefit be of turning over our warehousing and shipping to a third party? Would it save money, and would it get the job done more accurately and efficiently? Would it be better for our customers?
Fulfillment companies (3PLs) don’t manufacture a commodity, but they can, and some like AMS actually do, provide almost everything else that occurs along the supply chain. Companies look for 3PLs when they want to simplify and at the same time increase the quality of their logistics and reduce mistakes.
Among the reasons a company may choose to outsource to a 3PL, is relationships. A good fulfillment company has long-term relationships with vendors, and they negotiate ‘high volume’ discounts. The discounts that the 3PL receives for small parcel shipping, for example, can be passed on to the clients, and this is an automatic savings.
A 3PL is also going to be very knowledgeable and experienced in analyzing a company’s packaging materials and their procedures for assembly and packaging. They’ll most likely be able to save money for the company in this area, as high volume discounts can once again be applied.
A good 3PL will be masterful at growing and shrinking staff and warehouse space, as this is something they must continuously do, especially during busy seasons when far more consumer goods are shipped. With a 3PL you’re dealing with professionals in the field of logistics who know how to analyze inventory movement and provide forecasting that will make the process ‘lean’ – meaning less waste.
Staffing is one of the most important things to look at when choosing a 3PL. There is a significant advantage gained by utilizing the professionally trained workforce of a fulfillment company. A good 3PL will be fully engaged in workforce development, and this means fewer mistakes, greater safety and security within the warehouse, and employees that can see most problems before they happen. Look for a fulfillment company that values and trains its workforce.
Another reason to look into a 3PL is that they are accustomed to complexities in packaging and shipping. International shipping can be difficult or time consuming for a company, causing them to lose profit. But international shipping is not unusual or puzzling for a 3PL – it is their profession. Complex packaging and assembly is much less complex to a 3PL than to an untrained workforce.
Access to premium software is one more advantage that shouldn’t be overlooked. A good 3PL uses top-of-the-line supply chain software, and this means that clients have access to premium software at a fraction of the cost.
Lastly, look for a fulfillment company that will function not only as a partner, but as an integral part, committed to creating client success as if it were their own. That’s what AMS Fulfillment does; that, and so much more.
If you’d like to learn more about what AMS can do for your company, please contact us by phone at (661) 775-0611 or by Email: [email protected].