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Third-party logistics providers are replacing traditional logistics practices with new shifts that will set the course for modern third-party logistics providers.
FREMONT, CA: The logistics sector has experienced transformative shifts in the last few years due to changing consumer behaviours, new advancements in technology, and increased delivery vehicle traffic. As third-party logistics (3PL) providers struggled to adjust, traditional logistics practices were no longer effective. With the global 3PL industry predicted to witness massive growth, new factors are setting the course for modern 3PL providers.
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Changing Consumer Expectations
One-day shipping has immensely impacted the retail and logistics industries, and instant gratification has become embedded in the modern consumer experience. Today, fast and free deliveries have become the norm, and the speed of delivery and free or discounted shipping are now relevant for almost every purchasing decision.
However, as quick-ship practices have fueled increased delivery vehicle traffic, carbon emissions, and the volume of packaging, consumers have become more aware of the long-term environmental impacts of their decisions today. As a result, sustainability is becoming more demanded, and consumers have made modest-to-significant changes to their consumption behaviours to live more sustainably. With supply chains being responsible for more consumer companies’ greenhouse emissions, sustainable logistics is now increasingly a priority industrywide.
Furthermore, 3PLs should rise to the occasion and act according to the current scenarios. Electric delivery fleets, carbon offsets, and recycled packaging are better options. By meeting brands in many places and working together to align end-to-end logistics services with their sustainability goals, 3PLs are uniquely positioned to correct the shipping industry’s environmental errors and realise a greener future.
Building Supply Chain Resiliency
Supply chain globalisation over the last three decades has resulted in numerous risks, including extreme weather events, labour disputes, and supplier disruptions. Climate change and the pandemic have increased these challenges, further revealing the importance of supply-chain resilience and diversification to prepare for and adapt to unexpected events and swiftly respond to and recover from these disruptions.
This is possible through the ample opportunities, data-informed predictions, and real-time demand analysis giving visibility into everything from weather patterns to seasonal shopping shifts, allowing companies and their 3PL providers to quickly identify, rapidly respond to, and recover from condition changes. To enhance their supply chains, organisations embrace surge-ready stockpiles, order orchestration, and end-to-end logistics control with 3PL partners. Working with a 3PL, brands can optimise their order fulfilment process from the time an order is placed through every touchpoint on the journey to a customer’s door, including returns.
Furthermore, as current 3PLs face persistent supply-chain challenges and labour shortages, they are adopting automation and robotic technologies to streamline operations throughout the entire lifespan of an order. On the other hand, data-driven order, warehouse, and transportation technologies are used to improve communications and increase visibility for logistics providers, brands, and consumers.
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