The fewer the links in the supply chain, the smoother it runs, right? Simpler means more streamlined in most situations, but as the last two years have taught us all, supply chains sometimes confound elegant logic. Straight-line supply chains, ones with only one supplier providing transportation or logistics, for example, are vulnerable to disruptions that can shut down your business entirely. A Covid-19 outbreak among your driver fleet or a fire at a warehouse could stop all operations in their tracks. Though having more suppliers means more reliability, it also means more management, greater expense, and more time spent on operations. The answer to this conundrum: 3PL services.  

What is a 3PL company?  

3PL stands for third-party logistics. Many companies outsource elements of their supply chain operations such as receiving, storing, packing, warehousing, and shipping to a 3PL company. 3PL service providers offer experience and expertise in logistics and transportation, as well as a broad network of resources they can tap to ensure these services are met for your company.  

The Benefit: You have a single point of contact for logistics and transportation, streamlining your side of the supply chain management, and your upstream supply chain has access to multiple suppliers to fulfill your company’s needs, ensuring better stability.    

Types of 3PLs 

3PL terminology can get a bit complex, but it basically boils down to how much of your supply chain management you want to keep in-house and how much you want to outsource. The main ways of working with a 3PL service provider are usually referred to as:  

1PL: Your 3PL takes on one element of your supply chain management. For example, the 3PL manages transportation and shipping services while you maintain your own warehousing and fulfillment processes in-house.  

3PL: An outside provider takes over fulfilling a transportation and logistics strategy that your management outlines. They provide all warehousing, inventory, shipping, and operations services.  

4PL: Your company outsources almost all aspects of supply chain management, leaving it to an outside company to work with multiple 3PL service providers to execute transportation, logistics, and fulfillment.    

Here’s the thing about 3PL services though—most companies can execute transportation and logistics services at any level your company is comfortable with. They offer multiple 3PL services to fill or streamline any gap that your organization may have.  

Examples of 3PL Services that Streamline Supply Chains 

3PL services offer to pinpoint solutions for the sections of your supply chain that slow down your operations or cause undue expenses. An experienced 3PL provider likely manages multiple clients shipping various products all over the world and can easily spot trends, and best practices. They can speak with you to identify the issues in your supply chain and offer specific services like:  

Freight Brokerage: A lot of people use the terms 3PL and freight brokerage interchangeably because of the industry’s history. It used to be that a 3PL’s main job was to serve as the intermediary between shippers (who need to move cargo) and carriers (truck drivers or trucking companies). Companies called their freight broker when they needed to make a shipment, and the freight broker found them a carrier. Almost all 3PLs still offer freight brokerage services, but likewise, most offer many more logistics and transportation services beyond freight brokerage.  

LTL Shipping: Every business has freight lines where they aren’t shipping enough product to fill an entire truckload. Rather than paying the full cost of a partially loaded truck, less-than load (LTL) shipping combines loads from several clients bound to the same destination. You only pay for the portion of the trailer you use. You can fulfill orders much faster because you don’t have to wait until you have enough orders to recoup shipping costs. And, you reduce your warehousing costs by moving inventory more quickly.     

Dedicated Trucking: If you want all the benefits of having your own trucking fleet with none of the hassles of managing it, dedicated trucking is your answer. 3PLs offering dedicated trucking sources the trucks and drivers for a company’s regular shipments. They also conduct fleet management tasks like safety analysis, hiring, training, and truck maintenance. Dedicated trucking helps guarantee your freight capacity needs, can be customized for your specific products, and allows for shipping flexibility. Again, you gain predictability in your costs and your shipments without having to commit more management oversight.     

Third-Party Warehousing: Third-party warehousing is just what it sounds like: warehouse rental to store, outsource, and distribute your products. Many third-party warehousing services come with options for inventory management, packing, order fulfillment, and more. So, you’re not just getting the warehouse space, you’re getting increased transparency about your shipments, reduced shipping costs, and no need for warehouse capital investments or labor management.   

Cross Docking: In cross-docking, rather than shipments being offloaded into a warehouse to sit before they are uploaded to their new location, shipments are offloaded from an inbound truck, sorted, and directly reloaded onto an outbound truck. They skip the warehouse entirely, saving you storage expenses, and getting your shipments to their destinations more quickly. Cross-docking is an ideal supply chain strategy for most companies, but it takes a high level of logistics expertise and access to LTL operations to execute properly. Because 3PLs manage logistics at scale, they can offer cross-docking, where many companies could never accomplish it internally.  

Logistics Network Design: If you’re ready to outsource the main transportation and logistics side of your supply chain management, then you need logistics network design services. Network design in logistics outlines the physical elements of your supply chain and how they interact. For example,  how many manufacturing plants and distribution centers you need, what retail outlets link to which distribution centers, and where distribution centers are located, etc. With logistics network design, your 3PL takes on strategic elements of your supply chain management, rather than simply executing your company’s strategy.    

The list of specific 3PL services could go on for days: supply and demand planning, materials handling, oversize load, and FTL shipping, reverse logistics, kitting and assembly, and more. 3PLs are transportation and logistics experts, and all of their services are designed to address issues within the supply chain.  

Full-Service Transportation and Logistics Providers in East Tennessee 

A good 3PL service provider will help you identify your company’s unique supply chain needs and offer you multiple options for addressing them, ranging from a single service to full, strategic management. A great 3PL company can offer services and strategies across multiple supply chain categories so that your shipping and logistics are integrated under one roof. After all, the truism that ‘the fewer the number of companies in your supply chain, the better it runs,’ came about for a reason.  

Roane Transportation is a full-service 3PL service provider. With Roane Transportation, you will only need to communicate with one company for your shipping and logistics needs. We own our  warehouses and  fleet of trucks and employ our own warehouse laborers and truck drivers. We’ve been providing transportation and logistics services since 1996 and have the expertise and the flexibility to serve your organization’s unique supply chain needs. If you’re interested in streamlining your supply chain through Roane Transportation’s 3PL services, contact us today.