You have numerous options when managing the supply chain of an emerging CPG brand. Yet, the decisions made early on can greatly impact the speed at which your company grows.
You can choose to work with a variety of different logistics providers with one managing warehousing and others overseeing different transportation lanes or modes. This is often the strategy chosen by those who value getting the lowest rates, or by those who choose to tackle growth as it comes.
Or you can work with a single-source 3PL to oversee all your transportation and supply chain needs – whether that be e-commerce fulfillment, warehousing, dedicated transportation or spot freight. This strategy is the best fit for brands that enter the market with holistic plans for expansion and that value the support of a logistics partner to navigate flexing demands.
Benefits of Choosing a Single-Source 3PL
When looking to grow your CPG brand – whether by getting onto retail shelves, executing a record-setting holiday season or adding new SKUs – you could be hit with unexpected complications that slow you down.
Scaling can get messy (and expensive) when you have to coordinate between multiple partners, navigate unfamiliar big-box requirements, manage disparate data and systems, increase on-hand inventory or flex to unplanned market shifts.
That’s why it pays to work with a single-source 3PL that has experience with both e-commerce and retail. When established with a logistics partner that can shift to meet your warehousing, fulfillment and transportation needs, you’ll be ready to tackle growth opportunities as they come your way. Not slowed down as you try to ramp up.
Let’s break down the specific ways a single-source 3PL can help your brand optimize operations, boost profitability and expand without delay.
Dealing with multiple transportation and fulfillment partners can lead to communication challenges, which can result in misunderstandings, delays and inefficiencies. By working with a single-source logistics provider, you streamline communication channels.
This means you have a single point of contact who understands both your warehousing and transportation businesses, making communication more efficient. This reduces the risk of miscommunication and gives you added bandwidth to address other business needs.
When a single partner manages your fulfillment, warehousing and transportation, they can more easily identify opportunities to consolidate shipments.
With full visibility, they can analyze your distribution needs and identify ways to combine smaller shipments into larger ones or secure pool distribution opportunities with other similar customers. This can drastically reduce your transportation costs and optimize space utilization.
With full management of the multiple functions of your supply chain, a single-source 3PL can offer you an unmatched level of transparency that makes it possible to address inventory and transportation issues confidently.
Having a clear view of your supply chain is crucial for effective decision-making. When visibility is split across multiple technology systems or partners, it becomes cumbersome, and sometimes impossible, to make smart choices.
One of the primary advantages of working with a single-source logistics provider is the potential for cost savings. By centralizing your logistics needs, you can negotiate better rates with carriers, take advantage of bulk shipping discounts and eliminate redundancy in processes, ultimately reducing your overall logistics expenses.
Additionally, a single-source 3PL can add value by evaluating your entire operation at once. They can see inefficiencies and cost-saving opportunities much easier than stand-alone partners who can only evaluate one piece of the puzzle at a time.
Dealing with multiple partners introduces a higher level of risk due to increased complexity and potential points of failure.
Notably, a single-source 3PL with trucking assets and a brokerage arm can protect against market fluctuations by using owned trucks during high demand, leveraging brokerage services for additional capacity, and diversifying risk across both sides of the business.
They can offer stable rates through long-term contracts, use data analysis to adapt to trends and provide emergency solutions during disruptions, creating a resilient logistics network.
Having to work in multiple systems with different providers can become highly convoluted. Unmatched data can cause inventory issues like stockouts, overstocking, missed orders and unhappy customers. When working with a single-source 3PL, your systems all speak to one another and can identify potential issues long before they happen
Seasonal ebbs and flows can be managed with ease when you have a partner who can flex to meet your changing requirements. A single-source 3PL can promptly adjust its operations to meet heightened requirements.
Centralized management allows for rapid decision-making. This agility means you can swiftly adjust your distribution strategies, reroute shipments, or reallocate inventory based on up-to-the-minute information without interrupting product availability and delivery timelines.
Growing from online to retail sales requires a seamless transition that can be challenging to manage. But if working with a single-source logistics partner that has experience in both e-commerce and big-box fulfillment you’ll be armed with the expertise you need to jump from parcel to pallet orders.
Getting products on the shelf can be flawless when your existing partner already understands retail sailing schedules, pallet staging requirements and how to avoid potential on-time delivery hurdles.
When working with a single-source 3PL, they are fully invested in your business, not just a piece of it. You’re not just another client on their roster. They view your success as intertwined with their own.
This mindset means that they go beyond operational efficiency and can tailor solutions to integrate with your broader business strategies, ensuring that your supply chain is not a standalone function but a strategic enabler of your growth.
Thrive Online and Offline with a Single-Source 3PL
If you’re an emerging brand with dreams of growing big, don’t underestimate the importance of choosing the right logistics partner. It is highly disruptive and expensive to switch providers during a growth period.
When chosen early, a single-source logistics partner can help eliminate the missteps that often come with scaling a brand and prevent costly surprises – enabling you to become a successful company that thrives both online and offline. They can grow alongside your brand and be ready to jump when you are.
Rather than choosing the lowest-cost provider, it benefits your brand to choose a logistics partner who offers value beyond a rate. The right single-source 3PL can be your guiding light, helping you navigate market challenges and embrace the opportunities that come your way.