When Should Your Company Consider Working with a 3PL Warehousing Provider?
By James (Jay) Rigelsky on Mar 1, 2017
Sales, operations management, and the hiring and management of a company’s labor are critical tasks for any business. Most companies spend countless hours tracking and analyzing sales data from existing markets and trying best to determine new market opportunities. Additionally, it is the responsibility of the sales management team to nurture and extend existing relationships and develop new relationships that can facilitate market penetration.
While sales representatives are typically the day to day faces of their organization and their duty is to generate sales and revenue, it is the daily task of the operations team to deliver on the promises of the sales force. Additionally, it is the operations team’s task to make sure products are readily available not only to direct delivery customers, but to retail outlets for walk-in customer consumption as well.
As companies grow in existing cities and attempt to generate revenue by entering new markets, oftentimes, operation teams need short term warehousing and labor solutions for new locations. Once a new market is determined to be a viable revenue generating opportunity for a business, these same new markets create immediate long term service and labor challenges:
- If there is no company owned or leased warehouse option available to house and deliver products, what immediate solutions are available to an operations team that addresses consumer and sales team needs, in a fiscally responsible manner for the company?
- Are there viable opportunities available to companies that allow that company to harness the new growth opportunity without having to make a long-term commitment to labor and infrastructure?
A 3PL warehousing solution might just be the right answer to the challenges many companies face.
What is a 3PL warehousing company?
- Is it affordable?
- Is it flexible?
- Is it the answer?
3PL = Third Party Logistics: 3PLS are outsourced logistic and supply chain management opportunities for companies that may or may not have operational answers for a specific market. These outsourced logistic solutions can be single market providers, as well as, coast to coast, and global answers. Additionally, these 3PL providers can also provide companies with product solutions on a volume or seasonal basis. If labor is a company’s number one expense, warehousing and production costs are typically a close second.
3PL’s can provide immediate, short-term and long-term fiscally responsible solutions in an existing or new market for all types of companies. Through prudent negotiations, based on volume and market indicators, companies can put in place short-term, seasonal, or long-term solutions with 3PLs that will facilitate a company’s warehouse to consumer needs without the long-term commitment to labor and warehousing costs.