Whether you have been in business for long or have just started to use the services offered by 3PL, it is paramount to build a healthy relationship with the 3PL provider. Effectively managed relationship with 3PL provider ensures quality service even when the going is tough. Maintaining and managing a beneficial relationship with 3PL is a function of the contract agreement, time-to-time evaluation, open communication and efficient management of finances. Moreover, this reduces multiple bottlenecks which may impact your business and assists in achieving the objectives. The Bigger question is how to build and manage an effective relationship with your 3PL provider since this is a long and continuous process which hovers around organizational goals of both the parties.
Continue reading the 5 fundamentals which you must adhere to form a gainful relationship with your 3PL provider –
Precisely defined needs build a strong relationship
Needs of every business are unique, so you must define them well in advance before reaching out to 3PLs. Not all 3PLs would be able to meet the specific requirements your business might have. Additionally, even those 3PLs who possess the capability to service you, have a wide array of services on offer. Once you are clear with your needs, you would be in a better position to identify which 3PL suits you the best. This way you make sure that you are doing business with the best 3PL provider building a profitable relationship.
Clarity in the contract
Having a contract which spells out each detail neatly is the key to forming a valuable relationship with the 3PL provider. The agreement should be compiled on mutually agreeable terms and conditions. In addition, it should not leave any scope of a surprise for both the parties. For example, if the contract has the exclusivity clause, it should be very clearly defined that the clause is for which range of products, services, geographies and duration of the exclusivity. Even the smaller issues like frequency of cycle count should be clearly defined in the agreement. When there is such a deep-dive into the contract, even when things are shaky, your relationship with 3PL remains in a steady state.
Business gets affected due to fluctuations in the market, politico-economic conditions and other strategy changes. In such cases, contract signed with your 3PL provider needs to be reviewed to cater the risen ambiguities. This way responsibilities, role clarity as well as liabilities are redefined keeping the processes up and running.
Two-way communication never to be missed
It is imperative that information flow takes place at the right time between you and your 3PL provider. This communication is not just a one-time thing but an ongoing process which assists in maximizing the output and reduction of errors. It is safer to assume that higher the accuracy of information flow, better will be the performance of 3PL provider ultimately meeting or even exceeding your expectations.
Streamlining of finances
Financial management is one of the most important components, which if done in a structured manner would yield profitable relationship for you as well as the 3PL provider. Whatever terms and conditions were put in the contract agreement, you must honor them and make the payments accordingly. Any overdue payment, circumstantial negotiations, issues in account statements and other issues hamper your image as well as create losses for the 3PL provider. Hence, staying in the boundaries of clauses will lead to positivity in the relationship with the 3PL provider.
By following the above fundamentals, you can build on your relationship with the 3PL provider and get the most out of this partnership which is necessary for your business. It is important to find the right 3PL provider and then stick to these essentials for a beneficial relationship.
Holisol is a leading supply chain organization providing solutions in retail (end-to-end fulfillment), Auto & Engineering (packaging & supply chain) and Consulting. Holisol works on the value proposition of Design-Implement-Manage to offer customers an experience of working like their own extended team, with affordable strategic and operational expertise.
Holisol has a workforce of +300 supply chain enthusiasts who are continuously building value through leadership, innovation and relationships. For more information visits us at www.holisolscs.ae
Subscribe for Latest Blogs