September 23, 2021

How to Spot a Turnkey Logistics Operation

How to Spot a Turnkey Logistics Operation

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The complexity of the modern supply chain requires agility and advanced capabilities that can keep goods moving and avoid catastrophic disruptions. Dealing with the continuous impact of COVID-19 on the supply chain requires the ability to keep various logistics technologies and services working in harmony. To this end, finding a third-party logistics (3PL) provider with a broad range of connected service offerings can help mitigate communication issues between processes and streamline your overall supply chain operation.

A Lot of Moving Parts

3PLs come in many shapes and sizes, offering a variety of capabilities. Some specialize in a single area, while others have an extensive service portfolio. When looking for a single-source provider for your logistics needs, you might need some of the following capabilities:

FULLFILLMENT AND DISTRIBUTION

Retailers, e-commerce sellers, and direct-to-consumer manufacturers may lack the internal capabilities to fulfill online orders efficiently. Therefore, many 3PLs offer order fulfillment capabilities that allow businesses to hand off customer orders to an experienced partner rather than investing time and financial resources into building a large-scale fulfillment operation from the ground up. Some of the offerings within a comprehensive order fulfillment solution include:

  • Returns management
  • Inventory management
  • Packaging
  • Labeling
  • Pick-and-pack

While your company may not need individual consumer orders fulfilled, you may need to replenish inventory at your network of retail stores, service centers, offices, or other various locations. In this case, you want a 3PL that offers distribution services instead. Not to be confused with a fulfillment center, a distribution center focuses on moving larger volumes of goods and supplies, which the receiving facility breaks down for individual use or sale. Your 3PL may offer distribution services such as:

  • Reverse logistics
  • Palletization
  • Distribution management
  • Labeling
  • Cross-docking

Of note, some 3PLs can offer both distribution and online order fulfillment services from the same location for customers that need both services.

TECHNOLOGY

In 2021, supply chains simply can’t run efficiently without access to logistics technology software solutions. Any modern 3PL should have numerous technologies built into its rates that allow it to automate processes, collect data, and communicate with your in-house planning, forecasting, and order management technologies. Additionally, the 3PL makes investments in various material handling technologies, so you don’t have to. Some of the solutions found at a quality 3PL may include:

  • Warehouse Management System (WMS)
  • Transportation Management System (TMS)
  • Electronic Data Interchange (EDI)
  • Lot/serial tracking
  • Material handling systems

TRANSPORTATION MANAGEMENT/BROKERAGE

In highly volatile freight markets, a 3PL may stand as the difference between moving your freight or leaving it sitting unloaded on the dock. As capacity tightens, carriers tend to favor higher-volume customers that provide them with steady business. A 3PL can leverage the combined volumes of all of its customers to get capacity and better rates with parcel carriers, truckload carriers, and less-than-truckload (LTL) carriers.

When disruption becomes the new normal, you’ll also want your 3PL to have a diverse range of options to move your shipments. To move cargo when it really counts, many shippers will benefit from a 3PL with a combination of internal trucking assets, existing brokerage relationships with third-party trucking carriers, and the ability to move shipments on multiple modes.

INDUSTRIAL REAL ESTATE SERVICES

The United States currently faces a historic capacity shortage in industrial real estate. The lack of available industrial space can make it difficult for growing companies to establish new warehouses in critical areas. While many 3PLs offer some or all of the services listed above, far fewer have experience in site selection and real estate brokerage necessary to find viable locations in primary and secondary markets when capacity is exceptionally tight. A 3PL with an established real estate portfolio and the capability to expand it based on the needs of its customers can provide a valuable puzzle piece in your turnkey logistics solution.

About Phoenix Logistics

Strategic Real Estate. Applied Technology. Tailored Service. Creativity. Flexibility. These fundamentals reflect everything we do at Phoenix Logistics. We provide specialized support in locating and attaining the correct logistics solutions for every client we serve. Most logistic competitors work to win 3PL contracts, and then attempt to secure the real estate to support it. As an affiliate of giant industrial real estate firm Phoenix Investors, we can quickly secure real estate solutions across its portfolio or leverage its market and financial strength to quickly source and acquire real estate to meet our client’s need.

Since 1991, Frank P. Crivello has served as the senior advisor to the Trusts, and today is Chairman of Phoenix Investors. Given his extensive experience in all aspects of commercial real estate, Mr. Crivello provides strategic and operational input to the Trusts, Phoenix Investors, and affiliated companies. Mr. Crivello began his real estate career in 1982 focusing his investments in multifamily, office, industrial, and shopping center developments across the United States. In 1994, Mr. Crivello shifted his focus to the support of the Trusts. From 1994 to 2008, Mr. Crivello assisted Phoenix Investors in its execution of its then business model of acquiring net lease commercial real estate across the United States. Since 2009, Mr. Crivello has assisted Phoenix Investors in the shift of its core focus to the acquisition of industrial real estate throughout the country. Mr. Crivello received a B.A., Magna Cum Laude, from Brown University and the London School of Economics, while completing a double major in Economics and Political Science. Mr. Crivello is a member of Phi Beta Kappa. Outside of his business interests, Mr. Crivello invests his time, energy, and financial support across a wide net of charitable projects and organizations.

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