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3rd Party Logistics Providers are Impacted By Rising Fuel Costs

The challenges facing companies in general, particularly supply chain professionals continue to grow dramatically. The whole consumer demand supply chain continues to have more demands put upon it, and 3^rd party logistics providers and professionals must meet these new requirements with innovative solutions.

Logistics companies and consumers are forced to adapt to sustained high fuel costs. consumers and businesses are paying more attention to where their money is going and fuel costs are generally at the top of the expense category. Ultimately, the fuel pricing increase and sustained high costs will be carried over and included in the final price of goods and services purchased by consumers. As a business, you can help offset these increased final consumer prices by better managing your supply chain solutions.

Freight carriers and 3^rd party logistics providers have the biggest opportunity to help offset consumer costs. By maintaining equipment, reducing idle times, and combining partial loads, carriers are able to reduce fuel costs. Often times, carriers are able to offer warehousing solutions to better utilize equipment. Outsourcing to a 3^rd party logistics provider or building a relationship with a 3PL network provides a quick solution to problems that carriers and drivers face. The fuel savings carriers gain can lead to less fuel waste and unnecessary expenses—ultimately leading to higher margins for you and reduced costs for consumers.

3^rd Party Logistics Providers offer flexibility in delivery location, equipment, storage, handling, and labor. Third party logistics providers enable manufacturers, retailers, and wholesalers to gain competitive advantage through optimal transportation management. Logistics providers provide the advanced technology and services necessary to improve service, safety, and financial performance.

Consumers want a cleaner environment and more environmentally responsible actions, retailers and brands respond and make demands on suppliers. Suppliers and supply chain professionals—consumer goods companies rely on 3^rd party logistics companies who effectively consolidate LTL (less than load) shipments with other suppliers’ shipments and save on costs. This kind of consolidation and collaboration between 3PL providers and companies:

• Saves between 9-11% in transportation costs (on average), although savings vary widely.*
• Significantly reduces lead time on orders.
• Significantly reduces emissions and environmental impact.

Logistics companies are able to offer major environmental benefits in terms of fuel, fewer journeys, and less packaging.

* http://www.stateslogistics.com/