Hire an Ohio 3PL or Keep it In-House?
Thinking about hiring an Ohio 3PL? Operational complexities inevitably expand when the company does. Higher demand and more stock keeping units put added pressure on pickers and packers. At some point, businesses need to consider whether it’s worth it to keep supply chain management in-house or if they should hire an Ohio 3PL.
3PL, short for third-party logistics, is an outside firm used to handle distribution and fulfillment services to keep the supply chain running smoothly.
Both in-sourcing and out-sourcing arguments have merit, but the right choice is going to be highly case specific. It’s our goal at On Time Delivery & Warehouse to help you determine whether a hiring an Ohio 3PL makes the most sense for your current operations and projected growth. We want our customers to plainly see the benefits of a contract with us, so we encourage all potential clients to ask lots of questions and give existing clients the ability to track it all in real time.
Many business leaders have reached the conclusion that 3PL is the way to go, as evidenced by the facts revealed by a new market research report on 3PL Service Outlook projecting the global 3PL market will reach $925 billion in the next two years.
Why a 3PL Might Work For You
For most companies, in this increasingly digital and globally-interconnected age, many firms conclude it’s no longer feasible to manage geographically diverse supply chain operations. There are simply too many pitfalls, and they lack the experience, capacity or desire for constant contingency planning.
Logistics companies are already established with staff who can expertly pack and ship high-volume, complex packages. The best 3PL operations also have the latest software to oversee the pick, pack and ship processes at every stage. This becomes important when a company grows past the point where manual inventory recording is sustainable. Switching to a 3PL warehousing and distribution provider allows you to shift the risk associated with managing those people and processes – and keeps your firm free of the costs associated with property leases, manpower and equipment that these operations requires.
Other services a 3PL partner might offer:
- Product coding;
- Customer billing;
- Reporting sales, orders, product issues, returns, etc.;
- Manage product experts and conduct quality checks;
- Offer web-based applications to help you track inventory.
Why Some Firms Resist 3PL
Business leaders recognize that partnering with an Ohio 3PL is going to mean money upfront out-of-pocket. For some, that’s money they’d rather keep in their own pockets if they can. That’s perfectly understandable (and in some scenarios, reasonable). The problem is if your team isn’t spotting or timely responding to logistical snags as they arise, you are likely bleeding money – and you may not even realize it.
Some business owners argue they know their products best – and they’re right. However, they probably don’t know logistics the way an experienced 3PL does. This is all we do, so we have cultivated the partnerships, equipment and experienced staff to do it very well.
Company managers may conclude stakeholder confidence is higher when the the stakeholders know exactly who they are dealing with. However, if you have outgrown your supply chain capabilities, stakeholder confidence is going to be shaken anyway.
At On Time Delivery & Warehouse, we recognize it’s a bit daunting to invite another firm into the fold whose operations are going to directly impact your reputation and your bottom line. That’s why if you do go the 3PL route, we encourage you to make sure to contract with one that has a long-standing, solid reputation and is highly-regarded by current clients. Don’t be afraid to ask for testimonials and seek specifics!
“How Do I Know It’s Time to Outsource Logistics?”
When considering if a 3PL makes sense for your business right now, weigh the following factors:
- Lack of space. If you don’t have the space or the money to acquire new space for the warehousing you need, a 3PL is probably your smartest alternative.
- Markets that are newly-acquired. If you are now selling your product in markets that are some distance from your warehouse, a 3PL can usually get it there faster – and with fewer headaches for you.
- Different time zones/ international orders. Customers around the world are expecting faster delivery of their products, and if you have to make this happen across state lines or overseas, it often makes much more sense to outsource the supply chain operations.
- Your sales are seasonal. If your products are only selling seasonally, it makes little sense to start up and break down a warehouse annually.
If you have questions about the benefits of an Ohio 3PL, as our warehousing and distribution team for information and a quote.
If you have questions about Ohio 3PL services, contact On Time Delivery & Warehouse by calling (440) 826-4630 or sending us an email.
Third Party Logistics (3PL) Market Analysis By Service (Dedicated Contract Carriage, Domestic Transportation Management, International Transportation Management, Warehousing And Distribution, Software) And Segment Forecasts To 2020, Feb. 2015, Grand View Research
More Blog Entries:
A Cleveland 3PL Keeps Your Costs Down Amid Trucker Pay Surge, May 15, 2018, Ohio 3PL Blog