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Analyzing a 3PL’s IT Capabilities

The systems that 3rd party logistics companies have in place for every operation, from automation on the packing floor to the software monitoring the environment in temperature-controlled units, contain vital information for potential customers.

Before choosing a 3PL, it’s important that you understand the IT capabilities of each prospective company so that you get the best picture possible. IT (Information Technology) is about more than just passing orders from your website to the pickers and packers in today’s 3PL facilities. It’s also the best way to improve operations by finding problems before they get out of hand.

What 3PL IT Can Measure

We all know that 3PLs automate things like packing and warehousing distribution, but there are lots of other things that their IT departments monitor in order to increase efficiency.

According to Forbes, these are some of the most common areas that your 3PL should be watching:

Metrics Across Warehouses. Unless your 3PL only has one warehouse, they’ll have plenty of historical data that tells them a lot about each warehouse. That way when a metric changes, for example, when the pick rate goes up noticeably in one warehouse, they can isolate and replicate the results at other facilities. Warehouse metrics can also work in reverse, of course, and allow your 3PL to flush out problems in a particular warehouse’s management or floor plan.

Labor Management. How many hours each worker works and how efficiently they do their jobs are vital pieces of the puzzle. After all, if Bob the Packer has a perfect track record until a new batch of products came in, there might be a problem with the way the products are stored or labeled. Monitoring all angles of labor can help cut through individual issues, or issues with a particular section, quickly.

Recall and Hold Processes. Long gone are the days when a recall or hold process meant having to physically segregate recalled products, but they should still be tracked and monitored carefully. A quality 3PL has a obvious and consistent way to indicate to employees that particular products are recalled or placed on hold — even if they don’t move them from the warehouse.

Power Consumption. Although a less obvious question than most, knowing just how green your 3PL is can be valuable for marketing efforts and piece of mind. If your company promotes its Earth-friendly policies but uses a 3PL that wastes power, it can be a huge embarrassment when that information becomes public. Many 3PLs provide power consumption statistics and have plans in place to reduce the use of natural resources; live power consumption monitoring is a huge plus for facilities that are claiming to be actively working at becoming greener.

A 3PL’s IT capabilities can tell you a lot more about the company than the raw statistics would suggest. If a 3PL is willing to track themselves, deliver real time reporting to customers and adopt the latest technologies, they’re a 3PL that’s constantly looking for places to improve their performance in every way. That’s the 3PL partner to have.

July 23, 2015
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