Sep, 2017     

3PL Benchmark Assessment


Over the last decade with the internet boom taking place and more e-commerce and e-tail services coming up, the role of Third Party Logistics(3PL) has become really important. In the present times, more than 86% of the Fortune 500 companies use these services. A study was carried out in order to understand the performance of the various 3PL players in terms of shipments handled, reach, reliability cost for the client to identify the right logistics partner to partner with. The client also wanted to understand the broad contract terms offered by these 3PL players to the competitors of the client.

As a process, we reached out to our experts in the 3PL space to understand the performance of the key players in the market. We also understood the infrastructure capabilities of these players from the experts along with the reach in terms of pin codes these players have. We then reached out to our experts in e-tailing to identify the broad contracts and the rate cards offered by the 3PL players to them. Through our mystery shopping exercise, wherein we order 6000+ orders across 50+ pin codes in India every quarter, we identified the delivery speeds, the promise dates and compliance offered by the different players. The data from the various sources was then triangulated and our view on the performance of the different players was shared with the client.

There are a good number of activities that 3PL players cover such as Transportation, distribution, warehousing, shipping and receiving. It is vital to ensure before outsourcing the logistics that the party creates a sync with your inventory management system, order management system and others. Timely delivery and safe handling of orders is another attribute that has to be taken care of so that the optimization of shipment can be achieved. Also, global fulfillment of the orders for multinational companies can be another parameter. A competitor landscaping was done on these parameters based on the interactions with the industry experts. A detailed discussion was also done on compliance policies in cases of timely delivery failure.

The clients need to associate with a highly efficient 3PL for their shipping, distribution and warehousing needs. That was the main scope of the study. The parameters above were carefully taken care of while inspecting the list of available 3PLs in the market. The data from the interviews and research was carefully analysed in order to come up to some insightful requirements for the client and a strategy was generated thereafter, which would help him to collaborate with the exciting players in the markets based on his requirement and aspirations.

The findings and insights were used by the client to identify the performance of the key 3PL players and their capabilities, along with the broad contracts they have with the e-tailers. This helped the client identify the 3PL player to partner with and negotiate on key parameters and insights highlighted from the study.