To 3PL or not to 3PL… answering the question

By Keith Lawrence

- Last updated on GMT

Keith Lawrence weighs up the pros and cons of outsourcing
Keith Lawrence weighs up the pros and cons of outsourcing
General manager of milk at Wincanton’s Industrial & Transport division Keith Lawrence discusses outsourcing.

Irrespective of the product or the size of operation, all food manufacturers will face common challenges when it comes to storage and distribution of products in the supply chain.

In the dairy industry, for example, hygiene, speed and timing of collection, product quality, shelf-life and flexibility – given fluctuating volumes – are all critical considerations.

By choosing to outsource to a third-party logistics (3PL) provider, manufacturers can benefit from the efficiencies offered by a larger partner. These include quality and health and safety assurance, industrial-scale hygiene and monitoring systems, collaboration and sharing of best practice, shared resources with other producers, and access to larger, and often flexible labour pools, fleet and property portfolios.

When selecting a 3PL provider, work with a business that understands the nuances of your product and your market. Dairy needs will differ from meat or seafood, for example.

Choose a provider that can offer you the flexibility to respond to rises (and falls) in consumer demand or surplus of supply. Think about the structure of your agreement and how easy it is to scale up and down.

Can the provider offer cost efficiency, whether you are a large or small producer? How can you generate the best value from the warehouse and transport capacity on offer?

What is their record, for example, for health and safety, transport compliance or quality control? Consider who carries the risk in the event a collection or delivery is missed. What is the penalty for this and who will be liable?

Also, will your 3PL partner offer innovation and facilitate changes to your operating model?

Above all, work with a provider that will support you to meet your customers’ needs, acting as an extension of your business with shared aims and motivations.

Related topics: Supply Chain

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