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  November 7th, 2022 | Written by

What 3PL’s Need To Gain a Competitive Advantage

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The third-party logistics (3PL) industry has been the ongoing answer to the never-ending supply chain crunch. Constant volatility between labor shortages, pricey shipping costs, and global tensions impacting shipping capacities has led experts to believe the problems will persist through the holiday season

Shippers continue to have high expectations of their 3PLs, but performance isn’t meeting the mark. The 2023 Third-Party Logistics Study found a 7% decline in shippers’ satisfaction with their 3PL relationships. Shippers want to know their partners can monitor shipments easily, communicate frequently with brokers and carriers, and ensure compliance is met. This is increasingly difficult for 3PLs to manage, considering 90% of them increased their customer base in the last year, according to Inbound Logistics.

Visibility can help 3PLs meet and exceed shipper expectations. Technology can give 3PLs insight by tying together data, tracking shipments (and reducing lost or stolen cargo in the process), improving communication with shippers, and upholding all shipping requirements. It allows a 3PL to get ahead of any issues and become a trusted source over the competition. 

Let’s take a deeper look at how a visibility platform gives you a competitive advantage and makes you a more attractive option for shippers. 

Improve company efficiency 

When you invest in a software platform to improve shipment visibility, it will also help your employees be more efficient in their work. That improved efficiency can scale your business.

For example, a visibility platform can bring all of your pertinent data from a number of sources, whether it’s fleet data or other device information, into a single system. According to the 2023 Third-Party Logistics Study, 75% of shippers say that technology solutions are playing a greater role in their 3PL selection process. Tapping into a detailed technology platform frees up the time spent monitoring multiple data feeds and gives shippers a level of transparency that can unlock new business for you. 

With every hour saved by the platform’s efficiency, employees have the time to focus on other strategic work that can optimize company processes. Having the hours to improve work cycles and refine costs will increase the quality of your business, giving you an easy advantage over other 3PLs. 

Ensure compliance is maintained 

Adding visibility not only protects your business, but the shippers, too.

This becomes especially important when you’re working with sensitive cargo, as these shipments come with a list of added requirements. For example, the Food and Drug Administration has a number of compliance rules that must be met when transporting certain pharmaceuticals. Whether the shipments you’re running are medicine, cosmetics, or perishable foods, rules are in place to ensure the product arrives safely and in usable condition. But how are you supposed to manage what you can’t even see?

Visibility allows your company to closely manage carriers and help them ensure they’re meeting specifications by improving communication top-down. It also protects both you and your clients from any liability issues, because you have visibility into a shipment’s status, location, temperature, and other pertinent data. You’ll have any evidence you might need, right at your fingertips, to prove you’ve met all compliance requirements and upheld the standard of care your customers are asking for. Real-time data allows you to address any issues immediately. 

Mitigate carrier schemes 

Double brokering and double loading are well-known, disruptive issues to the freight industry. Visibility into your shipments helps you fight it off. 

Double brokering can create communication and compliance issues when a shipment is passed from one broker to another. Same goes for double loading — when a carrier tries to maximize revenue and efficiency by combining shipments, it leaves shippers stuck with unwanted, unknown liability. Both are major security issues that put your company’s integrity at risk . 

By investing in a visibility platform, you are able to monitor carrier compliance and offer shippers a new level of accountability for their cargo. You can see exactly where a shipment is and recognize when a double load is happening, immediately, to quickly fix the issue. 

Advantage over malicious actors 

Cargo thieves are plotting their heist of vulnerable packages this holiday season. According to CargoNet’s report from last year’s holiday trends, 185 thefts resulted in more than $9 million lost between Dec. 23, 2021 and Jan. 2, 2022. 

Improving your shipping visibility can mitigate potential losses throughout the holidays and keeps your shippers up-to-date. Technology can give you detailed data, define standard operating procedures, and alert you the moment any procedure goes wrong.

Those to-the-minute alerts allow you to take immediate action to quickly find potentially lost and stolen shipments. Visibility will set you apart from competitors when it comes to dealing with malicious actors because you’ll have a comprehensive view into every shipment made by your company and every action made by the carrier. 

Since the onset of the pandemic, 3PLs have been the key to managing supply chain issues, and even though challenges are changing, 3PLs can still play a huge role. Especially if they invest in visibility. It gives them the tools to exceed shipper expectations by offering several improved capabilities, which in turns wins over new customers. 

As supply chains evolve, 3PLs can offer a window into the process of moving shipments so all stakeholders benefit and some of the constraints can be eased.