Pros- and Cons- of Third Party Logistics
The term third party logistics, or TPL, refers to the outsourcing of one or many aspects of the supply chain to another company. According to a recent MIT study, third part logistics is a fast growing area, as more and more companies realize that it can drastically save them time and money to have an outside specialist handle things like shipping, storage and inventory management. Before choosing an outsourcing partner it may be helpful to take a look at the most common pros and cons of third party logistics to make sure that these services will be of benefit to your operation.
Pros of Third Party Logistics
Time and convenience
Outsourcing the most labor intensive parts of running your business, mean that you and your in house staff have more time to take care of the things that only you can do, like sales, marketing and so on.
Because most TPL companies are specialists in what they do, you can usually be sure that everything from labeling your inventory to packing and shipping it is going to be done by people who know what they are doing and in a manner that is professional and up to industry standard.
Quality TPL companies will offer several different services that can be combined or customized to fit your exact needs. Usually based around a warehouse inventory management system that stores, tracks and organizes your goods while they are waiting to be shipped, which can also be included, integrated logistics services allow for flexibility and personal customization.
Cons of Third Party Logistics
Third Party Logistics can be pricey, but most companies actually make money in the long run if they use them right, as they allow for higher volume sales and greater inventory control.
Loss of Control
One of the biggest potential pitfalls of outsourcing logistics management is the loss of control over your goods. For this reason, a quality company will always provide you with a efficient way to track your inventory at any point in the supply chain.
Not all TPL companies are the same. That’s just the truth. Always check into the experience level and resources that a company has before entrusting them with your goods.
With facilities in Atlanta and Savannah, Bonded Service Warehouse offers a full range of TPL service for companies of any size. To find out more about what we provide and how we can help you optimize or grow your business, call us today at (404) 349-1466.