Shippers keen to grow outsourced logistics functions - report

As businesses evolve and
consumers change their
demands, supply chains
continue to become more
complex – with shippers
calling for logistics partners
who offer comprehensive
and easily integrated
operations solutions that
can manage the growing
complexity of their
businesses.
That’s according to a
recent survey undertaken
by supply chain software
solutions company
Accellos. The Coloradobased
company’s study,
titled ‘Retail
Compliance:
Leveraging
technology
to exceed big
box retailers’
expectations’,
found
that 65%
of shippers would like
to outsource the entire
logistics responsibility as
the 3PL sector continues
to grow, allowing shippers
to focus on their core
business, while only 22%
are returning to insourcing.
The result of this
more collaborative and
innovation-focused
partnership enabled by the
4PL model creates more
consistency
for the
shipper,
according to
the report.
Another
oftenoverlooked
benefit
to the shipper in these
partnerships is that
with better information
solutions
they are more
able to align
supply chain
expense with
revenue, says
Accellos. “By
outsourcing
their logistics
functions as well as relying
on a 4PL to secure and
coordinate the activities
of multiple leading 3PL
providers, with facilities in
the best suited locations,
they are able to benefit
from ramping up or
reducing their expenditure,
based on growing or
shrinking volumes. At the
same time they can ensure
the best service is being
delivered.
Finally,
says Accellos,
the model
leads to
higher
levels of
profitability
for the 3PL
providers that secure
the role as 4PL. “As they
move beyond the tactical/
transactional services into
more strategic service
offerings, they can avoid the
danger of commoditisation
of their services and instead
will be able to contract
higher margin activities.”
By focusing on leveraging
the right technology and
taking a collaborative
approach to the 3PL and
shipper partnership, a
logistics provider can utilise
their best practices to the
fullest extent to become a
4PL, according to the report.