Action Steps for Selecting a 3rd Party Logistics Provider
The best contacts and resources to help you get it done

Purchase third party logistics software

Third party logistics software helps manage freight and shipping orders. This particular third party logistics supply reduces the need for manual inventories and minimizes paperwork. It also limits the amount of clerical errors and can even help prepare tracking or business reports.

I recommend: 3PL Software supplies accounting and warehouse management systems. Visit 3PL Systems for third party logistics software with user-friendly interfaces. Locate third party logistics warehousing software at 3PL Central.

Locate warehouse fixtures and equipment for third party logistics providers

3PLs require warehousing facilities with equipment to pull and ship orders. This includes shelving units, conveyor belts, carts, picking systems, canes, fork lifts and pallet jacks. These supplies allow third party logistics companies to provide faster more efficient service through better tools for your employees.

I recommend: SpaceRak provides selective storage racks, drive-in or drive-thru racks, pushback racks, cantibolt cantilever racks and cant-I-beam cantilever racks. Purchase conveyor belts, picking systems storage racks and other warehouse equipment needed for third party logistics at Warehouse Equipment. The Warehouse Equipment Company supplies a wide variety of racks, carts and other items used by a third party logistics provider.

Purchase shipping supplies for third party logistics companies

Shipping supplies for third party logistics are a necessity. These supplies prepare a package for shipping and include protective foam, peanuts or packing, boxes, tape and scales. Shipping supplies companies often offer paper catalogs you can request to compare products and prices.

I recommend: Uline Shipping Supplies provides boxes, packing foam and other supplies needed for third party logistics. Buy third party logistics shipping supplies at wholesale prices from Paper Mart. Visit PackagingSupplies.com for pallet wrapping material, boxes and tape.

Helpful advice for making the most of this Guide

• •  If you plan to open a third party logistics company, start buy purchasing basic supplies such as shipping supplies, shelving and a small software system.

Guide to Finding and Working with a 3rd Party Logistics (3PL) Provider

How to find and work with a 3rd party logistics provider to outsource your supply chain

By Greg Brown

Action Steps
The best contacts and resources to help you get it done

Find where you belong in the third party logistics world

Is your company really going to benefit from 3PLs? It can be very hard to know. Some companies are loath to let go of even routine warehouse work -- like stuffing boxes -- for fear of losing touch with customers.

I recommend: One way to make yourself comfortable with 3PLs is to review the annual 3PL study of third party logistics companies by consultancy CapGemini, SAP, DHL and the Georgia Institute of Technology. Find 3rd party logistics provider resources at Business.com.

Shopping for a 3rd party logistics provider

Once upon a time, trucks were trucks and ships were ships. Now most cargo companies have restyled themselves as 3PL warehousing experts, and some of these 3PL services are absolutely right on target.

I recommend: Of course, that target is you and your company. Choosing from among hundreds of third-party logistics providers is hit and miss, but a good start on 3PL services can be reading Inbound Logistics magazine's list of Top 100 3PL Providers or -- if you know your needs -- skip ahead to its 3PL Decision Support Tool. Leonard's Guide has a database of 3PL providers in the United States, Canada and Mexico.

Selecting a 3rd party logistics provider from the big names

Although big global logistics brands can be scary for small businesses to contemplate, it's worthwhile to include in any request for pricing. They have the scale and 3PL software technology to keep costs low, where a smaller 3PL warehousing provider might not.

I recommend: Some of the better known 3PLs include DHL, Ryder, Kuehne + Nagel, FedEx, UPS, Panalpina, C.H. Robinson, Ceva Logistics (formerly TNT Logistics) and Bax Global. See the Business.com directory page on 3PLs for more.

Driving value with 3rd party logistics provider software

What's unspoken about the 3PL revolution is the highly important role of third party logistics software and the Web. Standardization, connectivity and networking has played a huge part, allowing companies to outsource warehousing, light manufacturing, and the like.

I recommend: The result is fewer companies looking to move the dumb box and more asking for a role in your business -- handling customers and suppliers, for instance. Third party logistics software makes it work. Some vendors of 3PL software include 3PL Central, Traker Systems, Cadre Technologies and Webgistix. See more on 3PL software and 3PL warehousing management software at Business.com.

Helpful advice for making the most of this Guide

• •  The ability of 3PLs to do your specific kind of work is a matter more of track record than native ability. Find companies in your sector and find out what third-party logistics company they rely on first.
• •  Third party logistics companies are consolidating. As the DHLs and FedExes of the world move in, smaller companies get priced out. Before you sign off on a years-long relationship, do some due dilligence. Will your 3PL provider exist in a couple of years?
• •  Signing on for 3PL warehousing is just a baby step toward fully blown supply chain management using 3PL software. Before you get a third party logistics company deeply involved with your processes, make sure they have all that you need -- inventory, scale, vehicles, software and so on.

Action Steps
The best contacts and resources to help you get it done

Locate analytical logistics providers

Analytical logistics consists of the paperwork or computer work associated with logistics operations. Many companies provide analytical logistics services such as cross docking, network analysis and design, site analysis, process engineering and much more.

I recommend: PLS handles many facets of analytical third party logistics, including strategic, logistics management, material and inventory management, technology, and transportation solutions. Visit Komar Distribution Services for analytical and freight 3PL services. Find analytical third party logistics services at National Logistics Group.

Find a third party logistics provider for freight and fulfillment

Freight and fulfillment companies house your products and handle all of the order filling and shipping logistics. These companies provide services such as carrier management, freight bill audits, mode selections and vendor management.

I recommend: ProLog Logistics provides freight and fulfillment needs for companies searching for a third party logistics provider. Visit Aero Fulfillment Services and browse their available third party logistics services for freight and fulfillment services. Third Party Logistics provides a variety of third party freight handling services.

Contact a third party logistics provider for value added services

Value added services are a consolidation of analytical and freight services. However, valued added services cost more than the individual service. Companies that want to outsource their order shipping needs will benefit from the discounts of using one company for their third party logistics instead of a number of companies for various aspects of their logistics.

I recommend: Find value added 3PL warehousing services at C.H. Robinson Worldwide. Logistic Edge provides a wide range of third party logistics services. Hyperlogistics Group is a third party logistics provider who offers an extensive list of value added logistics services.

Helpful advice for making the most of this Guide

• •  There are many fees associated with third party logistics, such as warehousing, labor and freight. Review all applicable fees and costs before signing a contract with a 3PL company.

Action Steps
The best contacts and resources to help you get it done

Service developer

A service developer 3PL provider will give customers advanced value-added services by having a strong IT foundation and a focus on the big picture. These services include tracking and tracing goods, cross-docking, specific packaging and providing security systems.

I recommend: Find out about 3PL service developer services from Cybertration.

Customer adapter

The customer adapter 3PL type is specifically requested by the client to enhance logistics capabilities. This type of 3PL improves logistics without developing a new service.

I recommend: Learn about customer adapter 3PL from Beyond Giving.

Customer developer

Customer developer 3PL is the highest level of integration with the customer. The 3PL company takes over complete control over the entire logistics function. Providers of this nature have fewer customers and provide more in-depth service.

I recommend: Check out the information on customer developer 3PL from Midwest Third Party Logistics.

Non-asset based logistics provider (4PL)

Non-asset based providers, also called 4PL or fourth party logistics, do not own physical freight distribution assets, like trucks, pallets, or storage facilities. Instead they offer services such as consultation on packaging and transportation, tracking, freight quoting, auditing, financial settlement, customer service and more.

I recommend: Read more about non-asset based logistics providers from Dalor Logistics.

On-demand transportation

On-demand transportation is a term used to describe brokerage, ad-hoc and 'flyer' 3PL services. It allows providers to offer specific solutions to client supply chain needs. On-demand transportation prices can vary greatly from standard published rates.

I recommend: Find out how MercuryGate International has created a global on-demand system.

Next flight out

Next flight out (NFO), also referred to as best flight out when on a commercial airline, refers to modes of transport in the on-demand model of 3PL.

I recommend: Power Freight Systems offers more details about NFO services.