3PL Partnerships: A Guide for Businesses of All Sizes

The discussion explores the considerations that businesses face when deciding whether to outsource logistics to a 3PL (third-party logistics provider) and how 3PL partnerships evolve based on the shipper's size and complexity.

The key factors influencing the 3PL decision include:

• Internal Functions: Evaluating the cost and efficiency of managing pricing negotiation, technology systems, routing optimisation, carrier performance monitoring, in-transit support, and invoice auditing internally.
• Spend: Determining the appropriate level of in-house investment based on annual transportation expenditure.
• Shipping Complexity: Assessing the ease or difficulty of handling the types of freight or products being shipped.
• Technology Budget and Resources: Evaluating the internal capacity to integrate with various carriers and solutions.

3PL Relationship Models

The presentation also outlines the different relationship models between 3PLs and shippers, based on their size and needs:

• SMB Shippers: Transactional relationships focused on cost optimisation, access to market pricing, and basic support.
• Mid-Market Shippers: Consultative partnerships involving strategic advice on transportation strategies, network optimisation, and technology integration.
• Enterprise Shippers: Highly standardised buying processes, with 3PL selection based on capabilities, cost-effectiveness, and integration with existing technology.