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Outsourcing to a 3PL or Managing Order Fulfillment On Your Own? Benefits and Drawbacks of Each

When it comes to logistics, there are a couple of things that you need to know when you have your own business. Some are saying that you should outsource your logistics to a third party company. While others are claiming that the only way that you can be sure to do it correctly, it to do it yourself.

But what is the truth? Should you consider internal logistics, or should you outsource it to a third-party logistics company? Before this is something that you can consider, you need to know everything there is to know about 3PL and internal logistics.

Third-party logistics

Third-party logistics or also known as 3PL is a service that you can use to outsource all your business’s logistics. Meaning that this won’t be something that your business needs to manage and monitor.

3PL is a company that is just doing other business logistics. They are experienced, trained and normally have a good track record about logistics. Making sure that your clients are satisfied with your customer service, even if this isn’t you personally that is handling all the logistics.

Pros and cons of 3PL

One of the reasons why people are finding it hard to choose 3PL service or freight forwarding company for managing their logistics is because they don’t really know all the pros and cons of using this type of service. Knowing these, it is much easier to decide if this is a service that you can use or not.

Benefits of a 3PL service

  • You will have more time for the other important aspects of your business. Creating products that will be high in quality.
  • It will improve efficiency and this again will ensure that your business will grow faster.
  • It is cheaper than doing it internally

Drawbacks of a 3PL service

  • It is more economical for larger businesses
  • You won’t be hands-on about what is going on with your logistics
  • You’ll need to monitor everything closely to prevent fraud.

Internal logistics

Internal logistics is where you are doing everything yourself, or you are hiring people that are doing the logistics from the business. Working out of your office and from software and warehouses that you own.

For smaller businesses, this is something that will be more beneficial than using a 3PL service. You can even do it yourself, and you will know exactly what you are delivering the service that you have promised your clients.

Pros and cons of internal logistics

Even, if most businesses are still making use of this type of logistics, it is still important to know the pros and cons before you decide to still make use of the internal logistics method.

Benefits of internal logistics

  • You have full control of your business’s logistics
  • The software and systems are connected to your system. Making it easier to monitor.
  • Make sure that you are going to focus on client satisfaction.

Drawbacks of internal logistics

  • You will need to have all the equipment and software to do it yourself
  • You might find that time management is going to be harder.

3PL services or internal logistics. This is the one question that you need to make sure about before you decide to choose any one of these two ways. For some businesses, the 3PL service is the best option. While with other, smaller businesses, internal logistics is the best option. You should make sure that you are choosing the option that is going to be the most beneficial to your business. To ensure that your business is going to grow and become more successful and that deliver higher quality service.

For more than a hundred years, BCR has continued to help small, medium and large businesses achieve an optimum logistics solution with warehousing and transportation, including air freight forwarding services and sea freight services to and from the major ports including BrisbaneSydneyMelbourne, Adelaide and Fremantle (Perth).

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Nancy Whitman is a contributor to leading freight forwarding and third party logistics company, BCR Australia.

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