Transportation Decision-Making in Supply Chain Management
Does one size fit all? Not in transportation. To ensure your transportation decision-making is top notch, don’t just look at the bottom line. Look from bottom to top and everywhere in between. This includes the chain reactions resulting in your choice of logistics service provider.
When it comes to transportation decision-making in supply chain management, there are many options.
Ever wonder why one shipper chooses a carrier over another, or opts to use a 3pL? Choosing to align with a carrier or a 3pL will play a large part in the success of your company. When evaluating transportation partners, the scope and market area of the product should be considered. Selection based on cost alone could result in diminishing marginal returns in the long run.
When it comes to carrier decisions, consider using a carrier that services an area specific to your business. This could cut costs as the carrier may frequent your target area regularly. Also, frequency and time sensitivity of your product will play a role in the service level you require.
Work closely with a carrier to meet your transportation requirements.
This will give shippers the opportunity to understand the factors involved in ensuring your product in handled accordingly and arrives on time. Remember, with transportation comes many limitations. For example, Ontario’s Ministry of Transportation regulations, driver shortage and rising input costs are just a few of many factors carriers are juggling on a daily basis.
Most shippers have a large scope of products to meet many markets across North America. In this case, evaluating the service of a 3pL partner would be to your company’s advantage.
When considering a 3pL selection, look at the carrier selection process and carrier turn over rate for best selection.
A 3pL that has long standing, trusting relationships with their carrier-base reveals to the shipper the reliability and integrity the 3pL is upholding within the industry. 3pL’s that have many carrier partnerships are able to evaluate a manufactures transportation scope and match their needs with the carrier best suited to their core business. As a shipper, having unlimited access to transportation resources through one point of contact, will reduce time employees are required to spend focusing on transportation arrangements. This results in greater and more productive employees that will be reflected on the bottom line.