How to Select the Right 3PL Logistics Partner for Your Business

How to select the right 3PL logistics partner for your business? Be thorough and deliberate in your selection process and make the choice of partner with care. ltl trucking companies

With ever-expanding global markets and the fast pace of business today, many companies are looking to hire third-party logistics specialists to take over a part of, or even the entire logistics function within their supply chains. This outsourcing is done in order to free up vital company personnel whose focus can be shifted to growing the business itself. However, turning over such a key component of your operations to an outside vendor can be more than a little unsettling, and the choice should be made deliberately and with care.

Here is a strategy for selecting your third-party logistics provider.

Create a selection panel for choosing a 3PL provider. Pick panel members from across your entire organization. Be sure to involve every department. Have the representative from each department clearly define their department’s 3PL needs. From this compile a master list of 3PL needs, combining any similar needs from multiple departments

Next, the selection panel should write the company’s objectives based on the compiled list of 3PL Logistics needs. These objectives developed from each departments needs will become one of the primary search criteria for the selection of the new logistics partner.

Perhaps the top recruiting criteria for the selection of a logistics provider is your company’s own customer service requirements. The selection panel should review and understand your company’s customer service process and requirements. Your new partner must be able to deliver the level of service your customers expect and deserve. If not, why would you hire them in the first place?

Develop a profile for your company’s ideal Logistics partner. It can be as simple as a list of key attributes based on your company’s needs and what abilities and resources the logistics partner will need to meet and/or exceed current customer expectations. Use this profile to compile a list of potential 3PL providers which fit your company’s needs.

Conduct preliminary information gathering on the list of prospective 3PL partners. But don’t make formal proposal requests at this stage. Write and send emails to the prospective logistics partners telling them of your needs and requesting information about them focused on their abilities and resources to meet your firm’s stated needs.

Selection panel should then evaluate the responses and narrow the field of candidates. Send RFPs only to the top two or three 3PL firms. State your firm’s needs clearly. Be certain that the third-party vendors know exactly what they are agreeing to deliver.

Review the proposals you receive back from your short list of candidates. Schedule site visits with each. Review and visually confirm their stated capabilities to do the role you have defined for them. Consider having the visiting members of your selection panel monitor the finalists for at least one business quarter and report back to the entire selection panel, before having the selection panel vote on your new 3PL partner. Award the contract to the one provider the panel selects.
Making the right choice of your 3PL logistics provider will help insure that you start off on the right foot and create a foundation for a long-term mutually beneficial business partnership.