Third-Party Logistics (3PL): The Essentials

With the steep and ever-increasing demand in worldwide transport of goods, logistics has become a complex system that needs to be managed properly. The growing workload on end customers creates another need for third party’s services at a global level.

Third-Party Logistics or 3PL plays a major role in the success of businesses. In Third-Party Logistics, businesses depend on the providers of transportation and logistics services to manage their internal operations. This could range from storage, packing, handling transportation, moving, or any other related or non-related services required by the company. Essentially, Third Party Logistics providers act as an intermediary between the manufacturers, wholesalers, retail stores, and other supply chain entities to provide integrated solutions for products and services. Benefits using 3PL includes:

  1. Emphasize core competencies

By outsourcing your organization’s logistics functions, you will be able to focus on your core competencies, rather than managing non-core but critical functions on your own. Logistics expertise can benefit your business without deploying internal resources.

  1. Expertise and experience at your fingertips

Considering the complexity of today’s global market, it’s difficult to anticipate and incorporate competence across all capacities and regions. For instance, a 3PL provider has expertise in matters such as transport documentation, imports and exports, international compliance, and economic regulations. Logistics support and know-how can be provided by the partner to businesses that are looking to expand into international markets, thereby reducing delays, cutting down cycle times, and making entry into a new market smoother.

iii.           Expanding the market and enabling business growth

A third-party logistics provider’s role in supply chain management is to allow companies to grow by gaining access to markets where they have not yet established themselves. It can save money as well as the effort of learning the logistical nuances of a new market when inventory can be managed in a new market without the need for warehousing, equipment, or labor.

iv.             Ensure cost savings

The logistics services are provided by a third-party logistics firm specializing in business logistics, and therefore will have a broader network than your supply chain department. Their relationships with the logistics sector will likely be exclusive, and they will likely have greater negotiating power. In addition, they will be able to offer their clients greater volume discounts. By doing so, their overhead costs will be reduced. A 3PL company can also save you huge infrastructure investments since it can provide transportation, warehouse space, staff, and tracking technology, among other services.

v.            Satisfy customers better

As a result of all of the aforementioned 3PL benefits, our services and response times will improve, deliveries are timely, and our brands will be more reliable. The bottom line for any business is a satisfied customer.

vi.           Become flexible and scalable

In supply chain management, third-party logistics offers enterprises the ability to scale and adapt to changing business needs by utilizing supply and distribution resources at the appropriate time. The result is that enterprises can scale up when demand is high and down when sales are low. 

TGL is a logistics company that offers high-quality and affordable services to companies across the globe. As a logistics company, our value lies in our flexibility to provide clients with cost-effective solutions to meet their specific needs. At TGL, we recognize that each client has different needs and so our experts are always standing by to help you every step of the way. We handle our client’s freight with total transparency. By offering value-added services at affordable prices, we help them to reduce their costs and improve their profit margins.

Get in touch with our experts to discuss your logistics requirements


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