filter solution supply chain

Third-party logistics providers are now leasing more warehousing space than any other sector amid growing demand for 3PL services. CBRE's 2023 North America Industrial Big Box report found that 3PLs accounted for 41% of all lease transactions at traditional warehouses and distribution centers, with at least 200,000 square feet in 2022, surpassing retailers and wholesalers for the first time on record.

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Sustainability is taking on increased importance as companies respond to consumer trends and preferences, regulatory requirements, and environmental and climate impacts. Organizations are using their supply chains to better align with their environmental, social and governance (ESG) goals.

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The supply chain is increasingly complex and demanding, and there is no one-size-fits-all solution for moving freight. In today’s demanding freight environment, shippers are turning to a range of solutions to get the efficiency and agility they need at the optimal price point. Third-party solutions can complement shippers’ in-house capabilities or even other providers if companies source multiple partners.

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The Food Safety Modernization Act (FSMA) is transforming the nation’s food safety system by implementing best practices and requirements designed to prevent foodborne illnesses in consumers. Many of the FSMA provisions relate directly to the supply chain and keeping food and beverage products safe, fresh and enjoyable.

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The supply chain continues to deal with ongoing disruptions, which have become increasingly numerous, larger in scale and more simultaneous. While technology plays a critical role in keeping products moving, 3PLs and shippers can’t overlook the value of getting back to basics and focusing on core supply chain principles that have proven successful time and time again.

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Visibility is critical at the border, and being proactive rather than reactive can keep products moving. Penske has added a border workflow technology tool as part of its ClearChain® technology suite that facilitates collaboration between the many stakeholders involved in a border crossing to mitigate the risk of a delay.

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Increasing consumer expectations, ongoing volatility, and the drive to increase efficiency and control costs continue to enhance the value logistics service providers offer to shippers. The supply chain and logistics sectors have relied significantly on third-party providers to create and deliver value to end-user customers and consumers, the 27th Annual Third-Party Logistics Study reported.

“As the relevance of the end-to-end supply concept continues to advance, it has become clear that the quality of relationships between 3PLs and shippers is a valuable component of overall supply chain success,” according to the report, which was sponsored by Penske Logistics.

Dr. John Langley, a Penn State University supply chain professor and the founder of the Third-Party Logistics Study, wrote within the report that shippers continue to leverage what logistics service providers offer, and this facilitates optimization of the supply chain, minimization of costs and creation of value. Here are three ways logistics service providers are adding value to their customers.

Logistics Service Providers Drive Efficiency

The use of outsourcing can drive efficiencies, and each shipper organization needs to diligently assess the need for all of its supply chain services and determine which strategies relating to outsourcing best fit their needs, according to the study. The percentage of total logistics expenditures directed to outsourcing was slightly higher at 42% in the 2023 study, versus the 40% reported in the previous 3PL study.

There has been a continuation of the most frequently outsourced activities, which tend to be those that are more transactional, operational and repetitive, Langley wrote. The most prevalent activities shippers outsource is domestic transportation (69%), freight forwarding (60%), international transportation (52%) and customs brokerage (51%).

Technology Provided by a Logistics Service Provider

The 2023 Third-Party Logistics Study highlighted once again how important it is for logistics service providers to provide a range of IT-based services to help create value for their shipper customers. Shippers are increasingly aware that if they do not have the technological capabilities to accomplish their goals, they should partner with those that do.

Technology is increasing at a rapid pace and 65% of shippers stated that their expectations have been increasing, while 78% of 3PLs believe that shipper expectations have increased in regard to the technology solutions they offer.

Shippers appear to be becoming more confident in 3PLs’ technology offerings. Execution and transaction-based technologies tended to increase over the previous year, including transportation management-planning (62%), transportation management-scheduling (57%) and warehouse/distribution center management (48%), according to the study.

The majority of shippers — 94% — agree that IT capabilities are a necessary element of 3PL expertise, and 56% of shippers agree they are satisfied with logistics service providers’ IT capabilities, which the study identifies as the “IT Gap.”

Access to Analytics is Critical

As the amount of available data increases, shippers and their logistics partners will need to be able to take the available information and make it relevant. Many logistics service providers are already making significant investments in technology that allow them to analyze shippers’ operations. Nearly half of shipper respondents (48%) said advanced analytics and data mining tools are a “must have” information technology.

Various studies have documented the need for analytics to improve business planning and operations, and a number of these have focused specifically on applications and implications for supply chains and the key processes implied therein, Dr. Langley said.

There are several reasons why a production line may unexpectedly shut down, including a lack of supply, a lack of employees or a cyberattack. During COVID-19, production lines were shuttered worldwide, causing unprecedented supply chain disruptions. Restarting a supply chain, especially when stoppages are widespread, can be complex.

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Several companies stepped up to meet new demands during the COVID-19 global pandemic and pivoted their production lines to make much-needed items. Automakers shifted their manufacturing abilities from vehicles to ventilators, fashion designers started making face masks and distilleries learned to make hand sanitizer.

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Visibility and collaboration are at the core of a successful inbound freight operation. By successfully improving overall visibility, you can identify a potential problem earlier and build in a necessary contingency plan.

This new e-book from Penske Logistics includes information about how to create the perfect inbound solution, by taking a detailed look at a variety of options, including:

  • How to effectively make a change in providers
  • What private fleets can do for you
  • The best way to incorporate freight management services
  • Dedicated contract carriage and the ability to secure capacity
  • Keys to finding the right transportation partner

Then take the necessary steps to discover how you can maximize your freight management solutions.

Two new regulations in Mexico — the Suplemento de Carta Porte and Proyecto de IntegraciónTecnológica Aduanera (PITA) — are expected to create more documentation and record-keeping which may further complicate an already elaborate process.

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The fifth generation of mobile phone networks, commonly known as 5G, has arrived, and the list of cities with 5G access continues to grow. According to the 2022 Annual Third-Party Logistics Study, 5G is designed to provide comprehensive connectivity among virtually everyone and everything, including machines, objects and devices, enabling users to move more significant amounts of data more quickly. As a result, it should enhance supply chain operations, performance and real-time communications, ultimately driving the digital supply chain.

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For this global industrial manufacturer of vehicles and engines, production depends on exceptional and reliable service throughout the supply chain. When the manufacturer was looking for a partner to manage its distribution centers, it sought a company familiar with the challenges of automobile supply chain management and decided on Penske Logistics. Penske has managed inventory in two of the manufacturer's facilities in Mexico since 2002.

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Increasing efficiency to take miles out of a network can free up capacity and boost sustainability by reducing fuel use and cutting carbon emissions. Finding inefficiencies typically starts with examining data, reviewing business rules and evaluating equipment.

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By evaluating carefully crafted "what-if" scenarios, decision-makers can test-drive potential solutions to various supply chain challenges and choose the ones most likely to yield the best outcomes.

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There are three fundamental approaches to reducing and controlling supply chain costs: avoidance, mitigation and improving performance. Understanding each helps companies to decide which is more likely to deliver the most bang for the buck within their supply chains, and what measures need to be taken to capture the full benefits.

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An estimated 70% of all freight moved in the U.S. annually is delivered by truck, but completing these deliveries on time is not getting any easier. Increasing road congestion is one of the speed bumps that are disrupting delivery services across the nation.

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A "Lean" supply chain subscribes to the management philosophy that driving out waste is a sure route to business efficiency. Penske Logistics supports Lean practices as part of its culture of continuous improvement.

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From pandemic-related economic concerns to adverse weather events, traffic snarls and holiday-related closures, disruption poses a greater long-term threat to the global supply chain today than at any time in recent memory.

But shutdowns carry a silver lining: the opportunity to plan better and build a more resilient supply chain.

This new e-book from Penske Logistics provides you with a five-step Supply Chain Restart Guide. You'll get important tips on how to get back to business with minimal disruption, including insight on how to:

  • Examine your carrier base
  • Review your supply base
  • Develop a Plan "B" and a Plan "C"
  • Evaluate your entire network
  • Seek greater visibility

Download and read the entire e-book. Then follow the five steps to create a more responsive, agile and flexible supply chain that will help your company withstand future shutdowns and drive business forward, faster.