Dedicated Logistics Services: Say Goodbye to ‘One Size Fits All’ Solutions
Logistics have long been a challenge for many businesses. The COVID-19 pandemic only made things more challenging, resulting in fragmented supply chains and ever-changing consumer demands.
According to McKinsey & Company, the top three challenges in this space are:
- Labor shortages
- Equipment availability
- Global bottlenecks
To meet the industry's ever-evolving needs and overcome these significant obstacles, many companies are saying goodbye to a one-size-fits-all approach. They need something dedicated to them, built for them, and shaped by the unique demand of their business.
This brings us to the emerging trend of using a dedicated logistics service provider for your business’s logistics needs.
In this blog, we’ll share everything you need to know about dedicated logistics services. So, put on your seat belt, and let’s take a ride (pun intended)!
What Are Dedicated Logistics Services?
In simple terms, dedicated logistics services are offered by third-party logistics service providers. The logistics company provides and manages the drivers and vehicles to be used exclusively for the client's delivery needs. They have access to a larger network of vehicles and equipment and can save you time, money, and the hassle of managing an entire fleet.
Let’s say you need to send a shipment to a pharmacy in Quebec every Wednesday and don't have a vehicle that can store it with proper temperature control. A dedicated logistics service can ensure that you deliver your goods on time without requiring you to invest in equipment or technology you don’t use for the rest of the week.
Why Are Dedicated Logistics Services in Demand?
The demand for dedicated logistics services has never been higher, with many companies realizing they need a more modern, custom, and data-driven approach to managing their logistics in order to streamline processes and remain competitive.
Traditionally, the logistics industry relied heavily on rentals and spot freight models. Renting vehicles is a half-baked solution that usually requires you to find, hire and train drivers. The result? Extra cost and headache.
These - and other - business models aren’t scalable as companies grow, and that’s where dedicated logistics services come in. We’ll dive into some of the tangible benefits of these services below.
Benefits of Dedicated Logistics Services
Capital and Growth
COVID-19 has made companies push harder to free up capital and reinvest in their growth. Buying an entire fleet costs thousands of dollars, and the upkeep costs alone can cost you the same.
When you work with a dedicated logistics service provider, you don't need to invest in purchasing, leasing, or maintaining a fleet. This results in more freedom and capital to fuel the growth of your business.
In 2021, over 2.6 million truck driver jobs were unfilled, and the shortage continued to soar in 2022. The turnover rate in the industry sits at a whopping 92%. If you want to crack this code, you won’t have time to do what you’re meant to do as a business.
A dedicated logistics service provider leans on professional HR teams with experience in this area. While they take care of finding qualified drivers, you gain time to focus on your core business responsibilities.
Many risks are involved in managing a fleet, and even a single accident can result in costly litigation and settlements!
Having a dedicated logistics service means that the carrier assumes the risks associated with the fleet. Imagine not having to deal with insurance companies and lawyers.
Freedom to Do More
Unless you're a logistics company, managing a fleet isn’t your core operation. When you entrust this task to a company that specializes in it, you benefit from their experience and expertise while focusing on doing what you do best - running your business.
What to Look for in a Dedicated Logistics Service Provider
Now that we've established how a dedicated logistics service provider can give you the same benefits and consistency as you'd get from having your own fleet without the hassle and headache, let’s discuss how you can determine the best company to partner with.
Flexibility and Customizability
Look for a partner that can build or customize a unique solution to fit your specific business needs. They should be flexible enough to provide a dedicated fleet based on the routes you define and the schedule you need with vetted drivers and the right vehicles.
With the right partner, you can also respond to changes in customer demand by scaling your services up or down as needed.
Sustainability in logistics isn’t a ‘choice’ in today’s environment - it's critically important.
Look for a partner that has a good global conscience and is actively working on reducing its global carbon footprint. Even better, look for companies with electric vehicles in their fleet that can optimize delivery schedules dynamically to minimize empty miles.
While many businesses struggle to keep up with the latest technological advancements, some logistics companies are leading the space with innovative solutions.
By using technology, you can optimize your shipment schedule based on traffic, fuel costs, and environmental impact. It's also important to track your shipment in real time and ensure the best routes are used for all your destinations.
Look for a dedicated logistics service that's tech-enabled over traditional companies that prefer to follow old-school methods.
The Right Equipment and Facility
Each business requires a specific type of facility and equipment to ensure its shipment gets delivered at the desired quality or standard.
Whether you need ambient temperature-controlled environments, end-to-end signature chains, evidence of pick-up, transfer, and delivery, or anything else, make sure that the provider is equipped to facilitate your needs.
HR, Legal, and Insurance
It’s always a good idea to hope for the best and prepare for the worst. Look for partners that have transparent HR, training, and insurance policies in place.
When you're working with a dedicated logistics service, you'll want to keep control of your brand and its reputation by making sure that you're protected by law. Accidents happen, and with the right logistics partner, you can come out of it stronger.
6 Steps to Selecting a Dedicated Logistics Service Provider
When it comes to finding the right provider, it’s important to do your research and due diligence before you make a decision. Here are six steps to help you out:
- Create a comprehensive list of requirements you need from your dedicated logistics service provider. The list of requirements should include your shipment frequency, modes of shipment, vehicle types, or any special condition you want to meet for your delivery (temperature control, etc.)
- Look for providers that meet your requirements and narrow down your options.
- Contact the providers and get to know more about their values and processes. Ask them relevant questions to ensure that they meet your needs.
- Focus on providers’ capabilities and the portfolio of the clients they’ve worked with.
- Ask yourself if you see your business growing with this company as you scale.
- Partner with the provider that promises to be flexible and adaptable based on real-world experience and a strong understanding of your unique needs.
Hiring a dedicated logistics service provider may seem like giving up a lot of brand and quality control, but if done right, it’s a great choice for businesses looking to scale sustainably while freeing up capital to reinvest in their growth.
At Ziing, we’d love to be your first choice as a dedicated logistics service. We offer the benefits of a privately owned fleet without the liability, risk, costly hiring processes, and time-consuming driver training. Our technology-driven solutions prioritize sustainability, and we consistently strive to reduce our ecological footprint.
Work with us to sort out your routing, handling, and dispatching of goods while maintaining consistent and reliable service standards that deliver ROI.
Contact us to learn more about how we can help.