Nowadays, many companies are depending on 3PL (third-party logistics) providers to manage their supply chain networks. An ideal example is the computer industry that is hugely relying on the 3PL. In these years, the industry has changed significantly, thanks to the rapid advancement in technology. If your company is using 3PL, then you should consider various future factors that would affect the relationship between your business and the provider.
The first factor is the sustainability. Not all 3PL companies sustain for years, as some may not be able to sustain due to the growing changes and challenges in the industry. Economic uncertainties are one of the biggest factors that can make a 3PL exit from the business. Therefore, before choosing a 3PL, it is necessary to check how long it has the potential to sustain in the business.
One of the reasons that make 3PL to struggle in the market is due to the new regulations. There are many regulations put up by the Federal Motor Carrier Safety Administration (FMCSA) or another regulatory body that has severely affected the 3PL companies. One of the best examples is the Compliance, Safety, Accountability (CSA) regulation implemented by the FMCSA, which resulted in the shutdown of many bus operations.
An increasing number of new tools and equipment has created a new challenge for the 3PL companies. Though the increased usage of tools has improved the efficiency, the labor changes and demands have prevented the companies from effectively using these tools.
There are so many factors to consider. However the above three discussed factors seems to pose a great threat to 3PL industry.