The 2021 Third-Party Logistics Industry Trends
The second annual Third-Party Logistics (3PL) Warehouse Benchmark Report was released by 3PL Central. Customers expressed an interest last year in better understanding their industry and comparing themselves to their competitors. This led to the creation of a benchmark report. More than 200 3PL warehouses in the United States, Canada, Australia, New Zealand, and the United Kingdom responded to a survey in August and September 2021. Through the compilation and anonymization of this data, the benchmark report provides insights on 30+ strategic topics including growth opportunities, profitability, labor trends, warehouse space, technology, and success measurements. Well, you all must be knowing the concept of third-party logistics services. But are you familiar with the latest trends in third-party logistics? No worries. In this blog, you will get to know about the latest 2021 trends in the third-party logistics industry. So take out some time to read this entire blog. Let’s start:
What are Third-Party Logistics Services?
Third-party logistics (or 3PL) involves outsourcing eCommerce logistics processes to a third-party company, such as inventory management, warehousing, and fulfillment. Providers of 3PL services allow eCommerce merchants to accomplish more with tools and infrastructure to automate retail order fulfillment. As eCommerce grew during the 1990s and 2000s, the term 3PL became ubiquitous, and 3PLs expanded their services. Third-party logistics services are the process of integrating warehousing operations and transportation services into the supply chain.
Moreover, fulfillment outsourcing has many benefits. All 3PL companies provide reliable logistics systems and help businesses maximize profitability by managing their inventory, packaging, and shipping.
How Does Your Warehouse Compare?
Being aware of how your company compares to its competitors is one of the most difficult aspects of running a business. When are you ever given the opportunity to identify where you are excelling or where you might be falling behind? Are you one of the 85% of warehouses that saw order volume increase in 2021? By providing metrics like average order volume and profitability growth, the 3PL Warehouse Benchmark Report allows you to see how you compare to your competitors in the industry.
In the 3PL Warehouse Benchmark Report, key questions are answered, such as:
In what ways did 3PLs improve their profitability this year?
In the coming year, what are the biggest opportunities and challenges for most 3PLs?
How are companies investing in the fastest-growing technologies?
What are the methods of measuring and monitoring the success of the most profitable 3PLs?
Key 3PL Warehouse Trends
Several key trends were identified in the report, including:
Growth Opportunities- The industry expressed overall optimism for 2022 as it diversified to support new verticals and workflows.
Labor Shortage- The shortage of workers has presented a challenge to 3PLs trying to support growing orders. The top challenge for 48% of 3PLs is finding and retaining the right talent.
Space Constraints- Although capacity constraints continue to hinder growth, they have paved the way for the development of 4PL networks and improved profitability on existing operations.
Integrating technology and systems- As a result of technology integration, 3PLs were able to increase scale and productivity. Over 84 percent of 3PLs use a warehouse management system (WMS) for real-time tracking and management of inventory.
Success Measurements- Consumers' expectations about same-day and next-day delivery have increased the importance of order fulfillment times.
Therefore this is what third-party logistics services are. Hopefully, this blog turns out to be helpful for you to know the 2021 trends in the third-party logistics industry. So are you looking for the best third-party logistics services provider? We at PowerHouse LV have got you covered. We are your one-stop destination to get the best logistics services in Las Vegas. So what are you waiting for? Get in touch!