What is a 3PL Provider?

A third-party logistics provider, or 3PL provider, is an outsourced company that manages part or all of your logistics and transportation operations and executes transportation, freight management, warehousing, and other activities.

Which services does a 3PL provide?

If a company’s supply chain becomes too complex to manage internally, outsourcing to a 3PL is a great solution. You are still managing the overall logistics processes and strategy, but a third party handles the burdensome manual operations. Typically, a 3PL provides the following services:

• Freight forwarding
• Transportation management
• Load management & despatch
• Warehouse and inventory management
• Supply chain management
• Technology integration

What are the benefits of using a 3PL provider?

Time savings

Third-party logistics providers can save companies the time they typically spend managing their supply chain, so they can focus on other areas of their business.

Continuous optimization

One of the main goals of using a 3PL is optimization.  A 3rd party logistics company goes through every step of your supply chain to determine unnecessary operations and find the potential for cost savings.

Cost savings

A 3rd party logistics company provides more buying power, extensive carrier networks, and lower transportation rates. 3PLs also can help reduce the rate of returns, claims, shipping errors, and lost sales.

Carrier capacity

3PLs give you access to the carrier capacity and required equipment needed to move your shipment regardless of the season.

Industry insights

3PLs have thorough industry knowledge and insights, and they can accurately forecast what will work best for their customers.  When companies choose to work with a 3PL provider, they fully reap these benefits as the 3PL truly becomes an extension of their team.