Penske Logistics, along with Penn State University, Infosys and Korn Ferry, presented findings from the 2019 Third-Party Logistics Study: State of Logistics Outsourcing Report during the annual Council of Supply Chain Management Professionals (CSCMP) EDGE conference in Nashville, Tennessee.
This year's study found that shippers and their 3PL providers increasingly are moving toward meaningful partnerships and working together to accomplish their supply chain goals. The majority of shippers—91percent—report that the relationships they have with their 3PLs generally have been successful. A higher number of 3PLs—98 percent—agree that their customer relationships generally have been successful.
The study found that the most frequently outsourced activities continue to be:
Among study respondents, 89 percent of shippers and 98 percent of 3PL providers agree that the use of 3PLs has contributed to improving services to the ultimate customers. Additionally, 73 percent of 3PL users and 91 percent of 3PL providers agree that 3PLs offer new and innovative ways to improve logistics effectiveness.
Communication is one of the key components of a successful 3PL-shipper relationship, and the effective and efficient sharing of data between shippers and 3PLs resonates as a common denominator. Study respondents reported that smooth handoffs of information minimize the risk of disruption. The majority of shippers (61 percent) and 3PLs (54 percent) said issues with data sharing between the two parties contributed to customer satisfaction issues. Other consequences include late payments, not renewing a contract and negative word of mouth.
Those in the supply chain know disruptions and delays can have a significant ripple effect, causing increased costs, missed deliveries and downed production lines. Shippers and 3PLs participating in the Annual Third-Party Logistics Study said they are placing greater importance on mitigating supply chain disruption.
The top three disruptions are:
The top methods shippers and 3PLs use to mitigate and manage supply chain disruptions are supply chain visibility tools and partnerships. Both 3PLs (47 percent) and shippers (34 percent) said they are planning on investing in supply chain disruption mitigation/response capability in the next two years.
Technology can contribute to effective data sharing as well as efficient overall operations. Shippers are increasingly aware that if they do not have the technological capabilities to accomplish their goals, they should partner with those that do.
John Langley, a professor at Penn State University and the founder of the report, said shippers and their logistics partners will need to capture information and make it relevant. Many 3PLs are already making significant investments in technology. This allows 3PLs to analyze shippers' operations, find efficiencies and minimize the risk of disruptions.
In the study, the majority of shippers—93 percent—agreed that IT capabilities are a necessary element of 3PL expertise, and 55 percent of shippers agreed they are satisfied with 3PL IT capabilities.