The best business leaders know when to delegate or outsource parts of their business operations to other experts in their industry. Filling orders and shipping goods around the world can become more and more difficult to manage as your business grows and demand for your goods increase. If this is the case for your company, perhaps it is time to consider hiring a third-party logistics (3PL) or fourth-party logistics (4PL) partner to help transform your transportation processes.
The question remains: what should small, medium and large companies be looking for when hiring a logistics partner? In this article, we will consider the difference between 3PLs and 4PLs and how to choose the right one for your company.
What are third-party logistics partners for?
3PL partners, sometimes referred to as a freight forwarding partner, are companies that have been designed to assist modern businesses with their fulfilment and transportation needs. Ecommerce and online businesses have become a ubiquitous part of our everyday lives. In turn, this has increased the demand for experts in shipping with the resources, networks, tools and infrastructure to allow owners to focus on other aspects of their business.
The difference between 3PLs and 4PLs
3PLs and 4PLs are both designed to assist businesses in their warehousing, inventory, transportation and fulfilment logistics. However, despite their similarities, they are unique service provider types with intentional differences between them.
Third-party logistics partners are the foundation of the freight forwarding industry. These companies allow you to outsource some of your business’s operations, in particular, meeting order fulfilments and transportation requirements. A 3PL acts as the middleman or subcontractor for organisations looking to transport their goods through reputable and reliable shipping networks.
The main difference between a third-party and fourth-party logistics partner is the amount of managerial and logistical oversight they perform. In addition to everything 3PLs do for their clientele, a 4PL offers strategic insights and practical support to help businesses coordinate vendors and manage their entire supply chain.
The benefits of finding a trustworthy and capable 3PL
There are a range of benefits that come with investing resources into finding the right freight forwarding partner for your business. You gain the expertise of industry professionals that have years of industry insights under their belts, from international shipping regulations to streamlining supply chain processes, their knowledge and experience is incredibly beneficial.
Streamlining operations, finding affordable shipping companies and refining your company’s distribution processes will save you time and money. 3PLs have been exposed to a variety of costly and ineffective freight procedures that they can help you avoid. Not to mention, these freight forwarders play a critical role in scaling your business operations. They are in a position to grow with you and refocus your resources and efforts into other areas of your business.
Choosing the right 3PL partner for your business
Finding the right freight and logistics partner for your business will have a wide range of benefits to enjoy, but first, we need to identify what you should be looking for in a 3PL. Do not fixate on any one metric, find a 3PL that is suited to grow, develop and empower your company. Here are 6 things to consider when choosing a 3PL partner:
Safety and security
Your 3PL partner should make running your business easier and more secure. In addition to the safety training, shipping compliances and trusted carriers they provide, they should ensure the security of your cargo, data and resources. The best 3PLs will have all the necessary certifications and a long history of delivering effective services.
Great customer service
Finding the perfect 3PL partner for your business will help you build a strong, lasting and mutually-beneficial working relationship. Your freight forwarding partner should offer great customer service and a problem-solving attitude. Their services need to be respectful of your business processes and supportive of the goals you are trying to achieve.
Scalability and growth capacity
Any business owner worth their salt will have ambitious plans for the future of their company. You need to choose a 3PL partner that is capable of keeping up with your commercial growth and business development. They should be in a position to support your business goals and grow their capacity along with your company’s evolving ambitions.
Custom and adaptable logistics solutions
Ecommerce is an exciting, diverse and everchanging corporate environment that, today, includes almost every kind of business you can imagine. Not to mention, individual companies are often looking for custom and adaptable solutions that are able to transform with their industry. Depending on the industry, you might require varying levels of customisation to help your business evolve over the years.
Compatible tools and technology
You need more than financially, socially and logistically compatible business relationships between your company and your freight forwarding partner. A 3PL should have compatible tools, methods and technology that work with your current and future operational ambitions. The best 3PLs will have the latest tools and technologies, with capable IT teams, to ensure their methods fit in with your operations.
Reliability and trustworthiness
A thriving business is usually thriving thanks to a positive reputation and the highest professional standards within their industry. Your 3PL partner should be able to meet all of your business needs, but they also need to have a long history of successful logistics partnerships with successful businesses. Hiring a reliable and trustworthy freight forwarder will give you access to a larger network of vendors and carriers.
M6T are an established and trusted freight forwarding and logistics partner for many of South Africa’s leading businesses. We have a global network that spans across the international shipping industry and helps us provide world-class 3PL and 4PL services for our clients. Contact M6T today for all of your freight forwarding and logistics needs.