There is much written about the benefits of utilizing a 3PL provider to support your Supply Chain activities such as scalability, economics, allowing you to focus on core activities etc. This is a well-trodden path and the arguments for and against will fluctuate with economic cycles, the business environment in your area and your personal views.
However one often overlooked element is the role that the 3PL user has in making the relationship between the user and the service provider work.
I have found that the most successful 3PL partnerships require a real commitment by the user to impart knowledge and to treat the 3PL staff providing services as de facto employees. Not in any legal sense, but in coaching them in their duties for you, encouraging them by recognizing when things are going well, taking time to correct them if mistakes occur.
Fundamentally, it is the 3PL employees that provide the service and care for your customers-why would you keep them at arm’s length? It makes sense to recognize that they are more likely to care about what they are doing for you if they feel valued and informed.
Here are some suggestions that might help in developing winning relationships with your 3PL provider:-
- Invite the 3PL to bring the staff members that are servicing your account to your facility for a visit to see how you operate.
- At that meeting introduce them to those in your internal staff that might be impacted by their activities e.g. raw material purchasers, production planning, customer service representatives, operational staff, Senior Staff (V.P.s, President etc).
- Where possible bring your customers to the 3PL, this will facilitate the relationship with the 3PL and your customers.
- Take them through your SOPs going into detail with them regarding the nuances of your business.
- Provide the 3PL with copies of your SOPs, request that they create their own but use your SOP to capture the fine points of detail and the objectives.
- Become involved in the training of the 3PL staff, as it relates to handling your items and serving your customers.
- As far as is possible share your organization’s objectives with them.
- Agree the frequency with which you will visit the 3PL and stick to it.
- At these visits take the time to chat to the people looking after your account, ask their opinions, and seek out suggestions for improvements.
- Recognize 3PL accomplishments; for instance if they fulfill, on time, all Easter shipments.
Occasionally problems will occur, work constructively with the 3PL. Highlight the deficiency, agree the correction, request an SOP change if necessary and move on.
I could continue, but in the interests of brevity I will stop there. As I hope you will have seen I believe that if an employee of a 3PL is serving my customers I want to meet them, I want to get to know them. I want them to feel valued not only by their employer, but by me.
I want them to know me and to understand that my customers are important to us both and that we have a shared responsibility to fully meet the customer’s demands.
As more and more of the supply chain world is built on technology, procedures and contracted out resources; I have found that those Managers who still remember the importance of human relationships, and who recognize that one Fork Truck driver at your 3PL provider, properly motivated, can eliminate a serious error before it creates a problem, are more likely to have successful 3PL suppliers with all the consequent benefits this brings to both parties.
Carefully crafted procedures and investment in technology, such as RFID capability are without a doubt extremely important. But I have lost count how many times an employee of a 3PL has contacted me saying for instance “I’m picking this order and I can’t recall Walmart buying this item before.” This has led, upon investigation, to our realizing in the nick of time that the order had an entry error on it.
It is my experience that this interest by a 3PL employee should be promoted and encouraged by the user as it is an incredibly valuable weapon in the elimination of errors and the delivery of high quality customer service.
I believe that a multi-year, well-grounded relationship between the 3PL user and provider are in the best interests of both parties. The sense of joint commitment and focused strategy by both parties are extremely powerful in developing ongoing success.