Key Relationship Characteristics Shippers Need from a 3PL for Long-Term, Strategic Partnership and Success
Why should shippers rely on a single strategic provider for their logistics needs opposed to multiple providers who likely offer mediocre service? And what type of relationship characteristics will make up the ideal provider?
In this latest blog article, we outline some of the most important traits a shipper should hone in on from their 3PL provider in order to gain more benefits of long-term value and insight. If you’re not seeing these traits come from your current provider, then it’s time to make some changes that will support your shipping needs from a strategic and supportive standpoint.
INVEST IN YOUR BUSINESS RELATIONSHIPS
Working with one 3PL provider gives you (the shipper) a competitive edge. As a shipper, if you rely heavily on one provider's services and solutions, it allows you to build a strong relationship around transparency, trust and ideally, long-term value and partnership.. When a 3PL provider aims to work from a strategic standpoint, they will make a conscious effort to look out for your best interest by anticipating what your needs are, and in turn, proactively offer a more efficient and cost effective method. Receive top-notch service, and your customers will benefit from it, too.
Sure, it may also be helpful to have a back-up in the event that your main logistics provider cannot move a shipment due to a one off issue, as an example. Then it makes sense to reach out for help somewhere else. However, if it’s simply because of a rate or something that can be resolved, then jumping around to multiple providers could be doing your operations more harm than good. Why? It’s likely that these multiple providers are utilizing carriers from the same group, which means that the same trucking company could be offered your shipment by two or more of your providers. In essence, you’re competing with yourself and driving up the rate as there could be one trucking company, raising the bid each time your shipment is offered to them by a different logistics provider.
While this is one instance, there’s far more reasons to align your long-term business goals with a provider who’s willing to match that in the level of service they offer you; and that goes beyond transporting your goods. The use of one 3PL for all logistics services allows the shipper to remain as efficient as possible and focus on their own core competencies and customer needs.
KEY FINDINGS IN RECENT STUDIES
Back in 2019, Fortune 500 brands started to make the shift and realign their operations, leaving the old strategy of transactional shipping behind in favor of strategic logistics partnerships.
In numerous studies and logistics conferences, the notion repetitively appeared that “working with a 3PL on a strategic level can unlock previously untapped profit, offer more visibility, and streamline overall operations.” At the 2019 JOC Inland Distribution Conference’s opening sessions, several companies commented about what’s working and what’s not for them as a shipper, and eager to switch up their transportation strategies when responding to lessons learned in tougher freight markets like 2018.
According to the 2020 24th Third-Party Logistics Study, 85% of shippers agree that using 3PLs has contributed to improving services, not only for themselves, but additionally to their own customer base as well.
A 3PL’S KEY RELATIONSHIP CHARACTERISTICS
Shippers hire a 3PL to bring value to their organization, and know they have the capabilities to offer competitive pricing, refine logistics processes, and facilitate supply chain improvements.
But beyond these core values, it’s imperative that the relationship benefits you in other ways, too. Do they understand your wants and needs, or how you prefer to communicate? Are they loyal to you, and do they offer a personal touch in their services or are they strictly transactional and far from personal? It’s the little things that really make the biggest difference.
Consider a tactical and strategic third-party logistics provider to support you. Here’s our top 4 relationship characteristics that shippers should receive from their go-to 3PL provider to create a solid partnership and long-term operational excellence.
Transparency + Communication
Trust + Loyalty
After the first initial conversations between you and your ideal 3PL provider, they should be able to understand your logistics needs and company vision. With some further correspondence, they should already pick up and adapt to your style of communication, from how you prefer updates, etc. And with time, they are then able to predict upcoming shipments if, for example, you have repeatedly used them for weekend shipments, and so forth. The ideal 3PL is proactive and becomes very familiar with what you expect of them.
The same 3PL provider is supportive and transparent with knowing when to give you the “tough love” if you might be hesitant in change that could serve you well. For instance, when a shipper needs to act fast on a decision in order to not miss an opportunity, it’s in the shipper’s best interest to rely on their logistics specialist to steer them toward the right solution, and act on it quickly before the opportunity is missed. Afterall, the 3PL is the expert and can really save the shipper time and cost when they are 100% transparent with them.
Strong relationships have loyal partners. They are always reliable and it’s evident the trust is mutual. Loyal 3PLs pride themselves on the highest standard of service, in good and bad times. 3PLs with a strategic approach strive for long-term relationships so they want nothing more than the shipper to gain their trust.
According to a report from Gartner about 3PL relationships, “Some companies must address their inherent mistrust of 3PLs. Otherwise they will never unlock all of the added value that a more strategic, rather than transactional, 3PL relationship can bring to their logistics operation.”
When you build close-knit relationships, it’s clear you will receive far from mediocre service. After the initial stages of forming the relationship from scratch, your issues are heard and your needs are met far beyond what is expected. The ideal 3PL provider will come up with other tactics (such as cutting you a break in price or supporting you with a favor, for example) to ensure your shipment is delivered. They will provide out-of-box service however and whenever possible.
In short, all businesses today should be moving toward a partnership model for their transportation and logistics needs. If you are still operating transactionally, you are behind. It’s not too late to make a change. Consider key insights from relevant studies within this article along with these key characteristics that make up a strong, strategic 3PL partnership.
Have questions on some of your current shipping challenges? Are you bouncing around from provider to provider? Creative Transportation Services’ logistics specialists are available to support you and your next move. Let’s connect!
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