Shipping expenses are becoming a huge problem for many businesses, especially if the business is catering to clients across India or across the globe. Though the costs are rising constantly, often the businesses do very little to fix the situation. The boom in global manufacturing also poses a challenge as many carriers are at capacity. Other challenges that make things troublesome are strict government regulations and a shortage of skilled labor. These challenges also make transportation quite expensive.
Due to the aforementioned reasons, more and more companies are thinking about hiring a 3PL transport service provider. Even some companies who handled shipping internally earlier are outsourcing this function. If you are also thinking about making this decision, you must know about the 5 ways in which this decision will help you to save money.
Currently, the freight rate climate is about the best it has been in the last 20 years and your purchasing power plays a key role in negotiating beneficial deals with carriers. But, it is also a fact that most of the smaller companies lack the leverage needed in transportation spend to negotiate beneficial deals. Hiring a 3PL transport service provider in such cases would be beneficial as the outsourcing company will bring buying power to the table by serving as a single buyer on behalf of all the clients including you. This will ensure perfect optimization of rates.
When you select the topmost among Best 3PL transport companies in India, you will realize that the company already has a solid relationship with career counterparts that can be beneficial in ensuring that your product reaches the customer in time and at affordable rates. From customer service to C-level executives, the third party logistics provider would have relationships that have been established over the years. You should realize that seamless cooperation between carriers, 3PLs and shippers will keep the costs down as carriers would want to work strategically with the third party logistics provider to assist shippers in keeping the costs down.
Most of the 3PL transport companies understand the value of going paperless and managing processes electronically in order to save costs and reduce waste. This will lead to better auditing and streamlining of processes. Investment in technology will lead to immediate and long-term cost savings on back end functions while enhancing the levels of customer service delivered to your customers. Technology tools are also more efficient than human resources so the work would be done swiftly and in an error-free manner.
Integration of Systems:
A skilled third party logistics company will also use technology to integrate its computer systems with your own. It will lead to benefits like the rating engines being accessible to every member of your sales experts at each POS. They could also give instant and precise information regarding shipping costs at the time of sale. It could also automate things for the benefit of the customer. For instance, orders placed by a customer on the website could display the instant rates at checkout. It can also offer better post-sale services such as replacement parts fulfillment by letting the user manage it with just a few clicks directly through the web interface.
Human Resource Costs:
A third party logistics company would have access to skilled human resources who will handle all the transport related duties swiftly and efficiently. This will save you the trouble of hiring staff members to handle transportation and training them constantly to ensure better customer satisfaction. You will also stay away from the human resource issues these staff members might have as the third party logistics company will handle it, not you.
It is quite clear that outsourcing the transportation management function is the need of the hour as your company will end up saving much more money that it spends to retain the outsourcing partner.