Welcome to our continued investigation on preventing “buyer’s remorse” during the 3PL selection process.
We have prepared a list of 10 mistakes you can (and should) avoid during this process, and began to highlight some of them in a previous blog post. Our intent is to continue to uncover the list in its entirety over the next few weeks.
This week, we have chosen to review the following:
Mistake #3 – Not verifying Damage Claims History
This is very simple to assess, yet it is so often overlooked during the selection process. The 3PL providers in contention for your business should have taken the time to not only assess their performance in this area, but should be taking all necessary measures to ensure that their performance is nothing but superior.
Mistake #4 – Focusing only on price
We are all only too well aware that “you get what you pay for”. There must be an inherent value for services rendered for every expense listed on the corporate income statement. Using price as the sole criterion for choosing your 3PL provider fails to fully appreciate the value that said provider is bringing to your organization.
Choosing the least expensive service will not necessarily result in higher profit margins, especially when that service fails to deliver what was promised. The associated short and long term costs of that failure will certainly more than erode any savings achieved by discounted delivery costs.
Remember, price must always be simultaneously assessed with value.
Mistake #5 – Failing to determine on-time delivery rates
In our present-day high tech world, results and delivery are expected to be instantaneous. Nothing can damage your corporate brand more than a last-mile delivery delay, especially when your organization faces fierce competitive forces.
An adequate target on-time delivery rate would be in the area of 99%. This will ensure that your customers remain satisfied customers.
Join our blog next week, when we will continue to unveil mistakes that you can avoid when the time comes to select your third party logistics provider.
Alternatively, you may request a copy of the original document below.