TPL Companies , Third Party Logistics Companies , or 3PL companies face continuous and evolving challenges in order to keep up with demand.
These days, many companies have outsourced their warehousing and distribution services to a 3PL Company.
To differentiate themselves, 3PLs are working to provide value, innovative solutions and information to facilitate data-driven decisions. 3PLs are also using technology and data to aid shippers in selecting the right shipment modes to maximize efficiency and reduce costs.
Major challenges facing TPL companies
- Finding New Talent
The 3PL industry faces a challenge in the form of finding talent and this requires attention.. Most of the companies complain that it is very difficult to find the right candidates for the right vacancies.
- Rules and Regulations
3PL companies need to stay informed of the new sets and regulations imposed by the different countries.. It is a challenging task, for 3PL companies who try to cover as many markets as possible.
- Lack of Collaboration
The lack of collaboration between the shippers, the carriers, and the end-customers can have an adverse effect on the smooth functioning of the supply chain. That is why keeping the lines of comuincation open is key to a successful relationship.
- Meeting Requirements
This is a major challenge that is faced by 3PL companies wherein in certain cases they are not able to meet the specific logistical needs of the shippers. The shippers are usually disappointed with some of the factors provided to them such as packaging, on-time delivery, customer service, etc.
- Lack of end user understanding.
This is one key factor where 3PLs struggle with. Just imagine a customer who does not provide full scope of the work required and insists on changing the game plan on regular basis. Add to that the customer’s lack of knowledge of rules and regulations that 3PL companies have to abide by. In conclusion, the customer play a major role in the success of the cooperation with a 3PL company.
Due to the nature of the logistics industry, 3PL companies find themselves constantly battling customers, vendors and regulations to try to stay afloat. That is why, in the past, most of the TPL companies tried to stick to one line of business such as freight forwarding or just transportation.
Furthermore , due to the nature of the relationship between end user and a 3PL company, common understanding on both sides is a must. if either side is not able to cooperate, the result is failure of the process