Third-party logistics companies, also called 3PLs or fulfillment providers, perform a key function in the UK’s supply chain and economy at large. Primarily, the role of these third-party logistics companies is to handle supply chain and logistics processes for other businesses.
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Many business organizations prefer to outsource fulfillment operations to third-party logistics firms to avoid incurring costs for warehousing, transportation, logistics workers, distribution and retail centers, e-commerce platforms, and logistics management software.
Third-party Logistics Companies in the United Kingdom
Different third-party logistics companies in the UK offer different support services depending on the needs of the customer. However, the following are the most common examples of services provided by 3PL companies:
- Procurement of Goods: 3PL companies can order and receive the goods at any point of the supply chain.
- Order Fulfillment: 3PL companies can receive orders from clients and collect, pack, and arrange these orders before they are completed and sent out.
- Storage: The 3PL companies can provide storage for customer goods. These goods are usually stored in warehouses or similar establishments.
- Transport: Third-party logistics companies help customers to consolidate, deconsolidate, manage, and transport goods.
Businesses that outsource their supply chain and logistics needs have more time and attention to devote to their core business operations and therefore make higher sales.
What Third-party Logistics Companies in the UK Need to Manage a Client’s Supply Chain Needs
Since part of the role of third-party logistics companies is to take care of substantial operations for their clients, 3PL companies need ideal visibility over their customers’ supply chain information.
Third-party logistics companies need to constantly exchange information with their clients to provide maximum efficiency and avert the possibility of an error occurring.
The Benefits of Relying on Third-party Logistics Companies in the UK
It is far too common for one company to be a market leader and specialist in a certain field and build excellent customer relationships based on the quality of products or services they sell; however, the management of logistics in supply chains requires a totally different set of skills and experience.
Third-party logistics companies offer professional and cutting-edge supply chain services to keep your company ahead of the competition. Better than many, 3PL companies understand the best practices and emerging issues in the supply chain and logistics industry. They help businesses realize sustainable growth in their profits and customer base without incurring the costs of relocating or establishing physical premises in another location.
Since the UK is one of the leading exporters in the world, third-party logistics companies play an integral role in the country’s economy. A third-party logistics company helps you sell merchandise on the international market without having a physical presence in a foreign country. This is because a 3PL company manages processes like shipping, customs and compliance, and travel, to ensure the merchandise reaches the correct destination worldwide.
Effect of COVID and E-commerce Boom on Third-party Logistics Companies in the UK
According to a new report, the e-commerce industry in the UK generates close to 35% of overall retail sales. This is even though the first lockdown was not imposed until late March. In addition, close to 57% of consumers in the UK who took part in the survey were willing to continue shopping online even after the pandemic.
The same report continues that 15.6% of businesses operating in the UK shut down their physical outlets, while 8.8% ventured into e-commerce, and an additional 30% increased their existing e-commerce portfolio.
Simultaneously, the restrictions to contain the pandemic has not lowered consumer demand a bit. However, the continuing COVID pandemic and post-Brexit legal changes have significantly increased the pressure on logistics services in the UK. In turn, this strain has necessitated additional accuracy and efficiency in the logistics industry at unprecedented levels.
Defining Third-party Logistics Software
Software companies have come up with end-to-end, fully integrated solutions to assist third-party logistics companies in providing quality services to their customers. These software solutions are specifically designed for use by third-party logistics companies and seek to streamline all services in the supply chain, including warehousing, product packaging, and distribution.
Working with an experienced logistics company can boost the performance of your business to outperform your competition.
Third-party logistics companies are advantageous because they have built strong professional relations and accumulated first-hand market experience and the knowledge to ship your products safely and securely.
There is massive potential in the logistics industry to help your business unlock its growth and attain its next level of growth.