Strategy Why Outsource? It is estimated that the 3PL industry manages approximately 20% of warehousing in the United States. This is anticipated to grow to more than 40% in less than five years. As corporations are challenged to manage continuously changing market place conditions and pressures to downsize, and re-engineer themselves, they must create solutions with fewer internal resources. Outsourcing to third-party logistics providers allows a corporation to free up assets and achieve more agility with their supply chain network. Corporations outsource for various reasons, which include: Reduced capital investment in non-core business Access to the most current logistics techniques and technology Increased productivity Reduced costs and improved customer service Increased flexibility to meet today's changing business landscape Increased control and visibility of information and product flow   WCL Consulting Strategies Typical 3PL Services include: Warehousing Outbound Transportation Freight Bill Auditing/Payment Inbound Transportation Freight Consolidation/Distribution Cross-Docking Product Marking/Labeling/Packaging Product Returns and Repairs Inventory Management Information Technology Non-users of 3PL services have stated their reasons for not using 3PLs as: Concerned about control Would increase cost We have needed expertise Would not improve capabilities Strategies for Success? What lessons have been learned on the road to implementing a successful 3PL partnership? In an interview of the VP Logistics, Tropicana Corporation, he stated the lessons they learned in dealing with 3PL partners across the United States include: Develop a written contract Unbundle where appropriate Absorb risks that operator cannot control Communicate requirements w/candor and clarity Set measurable performance standards Include provisions to resolve discrepancies Have an exit strategy and back-up plan Overkill on Start-Up Also it is very important to realize that successful 3PL partnerships require/demand: More management time and effort not less was important There are no shortcuts The focus should be on long term and strategic benefits Why a 3PL Operations Assessment? As part of our core consulting practice, we help clients improve their outsourcing partnerships by conducting 3PL Warehousing Assessments. As a result of these assessments we have a unique, in-depth, perspective on what elements lead to successful 3PL partnerships. "Nuggets" we've learned through client engagements include: Corporate Cultures must mesh 3PLs must have in-depth knowledge of customers industry Both partners must be Process Fanatics 3PL should have similar business/product experience Committed and consistent managements 3PL is committed to continuous improvement Effective organizational links between companies