Three Reasons You Should Be Working With a Third Party Logistics Company

Logistical freight solutions

We live in an increasingly mobile world, and part of that involves the movement of goods over distances — which many business owners are keenly aware of these days. In fact, shipping is one of the top expenses for many businesses and all of the little details of supply chain management are not only time consuming, but they can get technical as well. This is why many businesses opt to work with a third party logistics company (3PL).

A 2014 survey found that small businesses that work with 3PLs see an average logistics cost reduction of 11%, average inventory cost reduction of 6%, and an average fixed logistics cost reduction of 23%. Here are a few easy-to-understand reasons you should be working with a 3PL.

1. Shopping for Rates
More than three quarters of shippers — 80% — pay too much for shipping because they don’t compare service levels and transit times among carriers. It’s understandable why businesses don’t do this — shopping for the best freight rate takes too much time. The thing is, a 3PL could offer integrated transportation management software which basically does all of that for you.

2. To Secure Parcel Service Failure Refunds
Another reason you should be working with a 3PL is to get parcel service failure refunds. In some cases, shipments can get damaged or lost which can be a monetary loss to you. Not only are you losing the value of the product that was damaged or lost, but you’re also losing the amount you paid for the product to be shipped. Claims process can be time consuming as well and are different for different carriers, but outsourcing to a 3PL can help.

3. Freight Auditing
Without freight auditing, your shipping department could be bleeding money without your realizing it. This can also be a lengthy and complicated process, but auditing your freight bills is essential. You need to make sure that you’re paying the correct amount to your carriers and that you aren’t being overcharged for anything.

Do you work with a 3PL to outsource any of these things? Feel free to share with us in the comments section below.