Shipping is the second-largest cost that small businesses face, the first being labor. When facing the competition of bigger businesses companies need to do everything they can do to keep costs low and create a competitive advantage all while moving their products from Point A to Point B.
A way to cut costs without cutting quality is to contract with Third-party logistics Company (3PLs) providers. 3PLs have existing relationships with multiple transportation carriers that give them the advantage of competitive pricing and allow them to handle tasks such as shipment execution, tracking, billing, invoicing, and auditing.
While 3PLs are great at cutting hard costs, they are just as good as cutting soft costs including decreased labor, reduced need for working capital, and access to transportation management systems (TMS).
Any business who handles their own shipping has a designated department that often requires several employees with additional labor as the demand for the product grows. Hiring a 3PL to handle shipping eliminates the need for multiple positions, bundling all the jobs into one system. Everything from auditing shipments for quality management, consolidating multiple invoices, claims management, to detecting shipment problems.
3PLs can cover the claims management sector which allows them to; settle claims for compensation, restitution, and repayment for damages suffered during the shipping process- all without disrupting the flow of business.
3PLs can also save small businesses time by researching multiple carriers. Whether requirements are based on the size of the shipment, the time frame the company is working around, or the shipment’s location/destination, 3PLs provide services to narrow the search and find the most cost-effective option.
Third-party logistics providers often have the technology and resources to simplify shipment tracking. They provide real-time cost and transit time comparisons—along with immediate online access to invoices and bill payment—making it easier for small businesses to track and trace their shipments.
3PLs allow small businesses to focus on their core competencies rather than their complex shipping needs. While saving money and helping them to increase their overall revenue in order to continue to grow their business doing what they do best.
Harris, Bobby. “3Pls Can Provide Soft Cost Savings For Small Businesses.” Inbound Logistics. (2013): n. page. Web. 20 Aug. 2013. www.inboundlogistics.com/cms/article/3pls-can-provide-soft-cost-savings-for-small-businesses.