If your company is trying to come to grips with the “when, why, and how” of partnering with a logistics company, take a look at the past year—particularly if your company has a peak season. Historical data is essential, as it allows you to determine exactly when your peak season is, giving you ample time to prepare and deal with the growth of your business, even if it’s just a seasonal bump.
Peak Season in Warehouse Shipping
While some businesses have a relatively steady annual shipping routine with no real ups and downs during the calendar year, others have a peak season. In most instances, this peak season is the last quarter of the year, preparing for the holiday shopping season. However, depending on the type of goods you sell, it’s the period leading up to the time of year when your products are “in season.” For example, bicycle vendors will have a peak season in Q1 rather than one in Q4 of a calendar year.
Why Partner with a Third-Party Logistics Firm
Using a third-party logistics company (also known as a 3PL) is a smart way to streamline your business. Rather than have to deal with the ebb and flow of your normal annual business cycle (increasing headcount during peak season and paying for unused warehouse space in off-peak seasons), you may utilize a company in business full time to handle those peaks and valleys. Unlike your company, an outsourced logistics firm has the infrastructure in place to deftly adjust to those changes in volume, as well as the ability to handle periods of unexpected growth.
More Benefits
A 3PL firm already has the pieces in place to get the job done from the word go. It provides the necessary infrastructure for the job—the manpower, warehouse space, and software to handle peak season shipping logistics seamlessly. It also utilizes warehouse management software that can be tailored to your company’s needs.
A warehouse management system (WMS) is software (often a cloud-based platform) that manages the warehouse, logistics, and shipping activity. It can handle a business’s supply chain operations and is often tied into an inventory management system and an accounting software package. A WMS allows companies to track inventory accurately and can also be used to generate reports. In short, it simplifies and makes the entire shipping process more efficient.
The Right Time to Make a Change
Any more significant business than a sole proprietor operating out of a garage is a candidate for partnering with a 3PL firm.
Your business’s ability to ship the correct item on time and for a reasonable price is essential for gaining (and retaining) a stellar reputation. Putting a 3PL firm in place, rather than attempting to piece together your warehousing, shipping, and logistics divisions, will pay dividends over the life of your company. It will save you from trying to staff and manage a division of your company that is far outside your core competencies.
Chris Capelle is a technology expert, writer, and instructor. For over 25 years, he has worked in the publishing, advertising, and consumer products industries.