Choosing a Logistics Company For Your Aftermarket Auto Parts CompanyWritten by Dennis Torrellas
The automotive aftermarket is a 368 billion dollar industry and continues to grow annually at an average rate of nearly 3.8 percent. As companies continue to develop new products they are constantly pursuing ways to stand apart in a very crowded marketplace. Transportation Management companies or 3PL’s are dedicated to improving the performance and overall experience a company has in dealing with its freight carrier partners by providing specialized solutions that offer a clear and coherent transportation management strategy.
Transportation or shipping is among the top 3 things that impacts a company’s bottom line, therefore, it’s vitally important as to how a company controls and manages both its inbound supply chain shipments from vendors as well as the distribution of goods on the outbound side.
The size of a company can often dictate whether they have the available resources or personnel to properly conduct a thorough internal investigation of how much shipping costs and the management of transportation impacts the entire enterprise. Unfortunately, management will often leave these decisions of how to manage transportation at the individual department level not recognizing or realizing that having the proper strategy and assistance of consultants or experts will ultimately yield the best results.
So what should you consider as key areas to address with your preferred Transportation Management Expert?
Investigate ways to improve visibility, flow, and access to information. Having the right information at the right place at the right time can quickly improve internal efficiencies. Your transportation partner should be capable of seamlessly inserting information into multiple departments by mapping new paths directly into your ERP system that provide rates, tracking, documentation, and reports as well as proving a robust online platform that can help you capitalize upon the growing market for eCommerce.
Carrier Utilization Optimization
Having the right carrier partners in place can help a company properly support and improve both supply chain and distribution activities. In today’s marketplace carrier service providers are looking for collaboration and that is the key to securing a stronger partnership. A good 3PL partner will significantly enhance the performance of your company’s overall transportation program by understanding your current model and then applying scalable solutions which will produce greater results.
Your 3PL partner should be able to deliver savings from the start due to their increased leverage and expertise in working with the carriers in several ways. A good partner will conduct a comprehensive review of current activity and pricing levels, understand and document demand requirements for purchasing & production, developing advanced planning strategies for distribution cycles, as well as analysis of historical lane and weight shipping averages which will allow you to significantly improve and properly align your company under a more cost effective and efficient model.
The utilization of transportation management experts, such as a 3PL, helps a company discover ways to streamline processes, improve efficiency in operations and reduce costs which will provide additional paths towards continuous improvement.