Choosing the Right Logistics Service Provider: Tips From an Insider
On the hunt for a logistics service provider? Outsourcing your logistics operations can bring many benefits, including streamlining your warehousing, order fulfillment, and communications to save you valuable time.
But when providers seem to offer many of the same services, how do you pick the right one for your business?
This blog post will give you some insider tips on choosing the right logistics service provider for your needs. We'll take you through the specific questions to ask and all the necessary details to bear in mind when navigating the world of logistics services.
Whether you're just starting out in the world of shipping and logistics or you're looking to switch providers, read on for insights that will help you make the right choice. Your wish list starts here...
If you’re looking for help with supply chain management, it’s important to find a logistics service provider you can rely on for support over the long term. Ultimately, it’s all about establishing a genuine partnership, which is why company stability is the first item on our list.
Ask logistics providers about the average tenure of their employees and how long their key people tend to stay with the company (you probably don’t need a logistics industry expert to tell you that high turnover is a big red flag). Look for exponential growth, another good indication that you’ve found a company that’s in it for the long haul.
2. Reviews and Reputation
From inventory management to warehousing, storage, transportation, order fulfillment, and reverse logistics, a third-party logistics company takes care of your entire supply chain. That’s a lot to trust them with. So how can you find a reputable provider?
It’s crucial to check the reviews and ratings of any logistics provider you’re considering. Do they work with companies in a similar industry to yours (an important consideration if your business has specific logistics needs, such as pharmaceuticals that must be kept at a certain temperature)? Are their clients happy with the service they provide?
We recommend looking to see if they serve large, reputable companies. The vast majority of these companies have very in-depth vetting processes – so if they’ve done their homework and are satisfied with the result, that’s a powerful checkmark in the “reputable” column.
Even better is a logistics provider that is always looking to improve. Their response to customer reviews is just as important; if they’re taking feedback on board to do better next time, that’s another positive sign.
3. Customer Support and Responsiveness
Here’s a quick test. Give your logistics service provider a call and see how quickly their customer services team answers the phone. Do they put you in a queue? And is there a live person at the other end of the line?
Customers expect to get answers yesterday; you have minutes, not hours, to respond to a query. That holds true whether you’re the business customer – the company outsourcing your supply chain logistics to a third-party provider – or the end consumer wanting to know when your package will arrive.
Look for a logistics company with area representatives. That way, you can deal directly with their local contact for faster, direct communication. One service we’re really proud of at Ziing is that we answer every call without putting people in a queue.
“With some delivery companies, your email might never get a response, you might get a call back, you might not. With us at Ziing, you get direct communication with the right people.” - Andrew Baugh, Key Account Manager.
4. Capacity, Coverage, and Location
Chances are, if you’re exploring outsourcing for the first time or even looking to change providers, capacity is already on your mind. Ask questions about a provider’s warehousing services, how much space they can offer, and what kind of custom capabilities they have.
Does their warehouse have a dock door – a loading bay that can be raised to meet the truck's height? Can they keep perishable products at the required temperature?
We also recommend asking service providers about coverage. Find out where their network operates and where their distribution centers are located – a central location, or even multiple sites, gives you a much wider reach. Ziing, for example, offers national coverage and can deliver products quickly anywhere they’re needed.
As well as addressing your immediate needs, you’ll also want to keep one eye on scalability. Can the logistics provider you’re considering help you expand across a broader geographical area? Will they give you the flexibility and resources you might need in the future as your business grows?
With technology advancing at a dizzying rate, it can be difficult to know exactly what to ask for regarding logistics services without being blinded by science.
Don’t be afraid to ask service providers for a deep dive into their technology. Ask about the platform they use and any applications such as IoT (Internet of Things) technology and GPS systems in delivery vehicles. Do all of their applications talk to each other? And can they integrate into your systems? At Ziing, for instance, we build our data-driven solutions around you, not the other way around. So you don’t need to worry about fitting into our system.
It’s also crucial to understand the impact of all this technology. Ask about the benefits to the end consumer. Will it help you meet your service promise with a quick response to customer queries and proof of delivery? What kind of shipment visibility can they offer? Look for a provider that tracks every parcel throughout the process, from pick up to delivery, with scans or photographs – something that’s especially important with sensitive products such as food, where the consumer needs to ensure it’s refrigerated as soon as possible after delivery.
Also, consider how technology can benefit you as a company. Ask about systems tailored to your needs – for example, what kind of reporting would help you make smart decisions?
Of course, you’ll want to ensure that services such as order management, transportation, and storage are covered. But how your logistics provider delivers those services will really give you a competitive advantage. Consumers are increasingly conscious of their carbon footprint, and it’s not enough simply to fulfill orders accurately and on time; you have to demonstrate that you’re doing it sustainably, too.
When looking for a logistics company, it’s critical to ask about sustainability. How do they reduce the environmental impact of each journey? What kind of packaging do they use when shipping orders? How easy is it to recycle?
Highlighting sustainability is a smart move from a financial perspective as well. Taking an environmentally conscious approach to transportation management can deliver healthy cost savings, for example, by consolidating delivery routes to reduce fuel consumption.
7. Safety Programs
This one’s non-negotiable. Your chosen logistics provider has to take safety seriously and hold itself to impeccable standards regarding transportation and shipping orders.
Look for a provider with an excellent safety record. The company should train all of its people well, from drivers to warehouse employees. Ask about training programs: What training do they offer, and what do these programs look like? Assume nothing, and don’t be afraid to get specific; for example, do its drivers and warehouse staff get dangerous goods training?
8. Value for Money
One of the factors driving your search is likely value for money. So how do you ensure that your logistics provider offers the best value?
This process isn’t about finding the cheapest provider. After all, you have to consider service quality. Poor warehouse management and inaccurate deliveries will cost you more in the long run. But the best providers can offer a great-quality service while still being mindful of your bottom line. For example, they might condense services to create higher-density routes that bring down the cost for everyone.
Another good tip is to think ahead and consider scalability when you’re discussing prices. Will a provider reduce service costs as your volumes grow? And what does this pricing mechanic look like in practice?
Ziing: Putting You First
“At Ziing, quitting is never an option. Our team’s main goal is your satisfaction” - Andrew Baugh, Key Account Manager.
At Ziing, we’re changing the face of third-party logistics thanks to our unique data model, unwavering commitment to sustainability and reliable delivery, and customer-centric mindset.
Get in touch with us today to see how our innovative technology can help your business really deliver.