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from 0 to +6 °C
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Warehouse logistics is the process related to stock management, warehouse organization, efficient product placement, loading and unloading works, handling of goods.
The main warehousing logistics functions are:
- Inventory control. Companies keep a record of their stocks to avoid situations when there are no necessary commodities in their warehouses. Enterprises develop and maintain WMS systems to store information about their stock balance. Moreover, IT solutions also help to track seasonality and replenish inventory on time.
- Goods storage and handling. It’s important to establish freight storage in such a way as to decrease money losses. So, a company should design warehouse planning, ensure accessibility to warehouse equipment, efficiently place goods for storage on racking systems, etc. All these practices help to reduce total delivery time.
- Goods processing. Picking and packing, pre-sale preparation, co-packing, labeling of goods are among the additional warehouse functions. Such operations are optional, but they allow companies to protect their goods from damage during transportation and increase average total value.
A company needs to extend and manage the warehouse network to launch its warehousing logistics. It’s challenging for many businesses to organize logistics. So the most popular practice of managing warehouse logistics is outsourcing.
Warehouse logistics outsourcing is a transfer of warehouse logistics tasks to a third-party provider. A logistics partner provides the resources to effectively solve the issues related to goods storage, processing, distribution, and delivery to the end consumer. Warehouse logistics services that are performed by a 3PL provider may vary according to the needs of a client and the types of services that a logistics provider offers.
3PL providers are specialized companies that offer professional logistics outsourcing services. They invest in high-class storage facilities, a modern fleet, and customized IT solutions. Thus, when a business outsources warehouse logistics, it can manage its supply chains without using its resources.
Warehouse logistics outsourcing can be full or partial. In the first case, a company hands over just some functions to a contractor. For example, a 3PL provider can only provide bonded warehouse services and then transfer goods to a client’s warehouse. In the second case, a logistics partner takes upon itself all supply chain management operations — from storage and transportation of goods to end-users to inventory control.
Logistics services are a range of operations that are connected with the movement of goods, their processing, loading, and unloading, accompanying documentation. You can request logistics services from logistics providers. The full range of the services depends on the specialization of particular 3PL.
Generally, all logistics services can be divided into:
- Transportation. A logistics provider matches a motor carrier according to freight type and shipment weight, estimates the best possible route, and plans commodities delivery time.
- Warehousing. A logistics provider places goods in its warehouse, taking into account a client’s points-of-sale and temperature storage conditions. Also, a contractor carries out all necessary operations in its warehouse.
- Marketing. A logistics provider plans commodities supply in such a way that goods were delivered to points of sale just in time.
- Procurement. 3PL provider undertakes raw material delivery for manufacturing.
Just one operation is a range of related logistics services. For example, if a company needs to deliver goods to retail chains, its logistics partner transports freight to distribution centers. However, sometimes the products can stay in the warehouse for several days. Only after that, it can be delivered to a retail chain.
Logistics outsourcing has many advantages. Some of them are:
- Ongoing solution for a company’s logistics challenges. A reliable logistics provider is focused on high performance. Generally, the majority of corporate logistics challenges occur in peak load seasons, holidays, and promotional events. A logistics provider guarantees any assigned task will be completed efficiently and on time.
- Using borrowed assets without having to invest in own. A company needs to pour cash into storage facilities, fleet, staff hiring and training to establish well-organized logistics processes by itself. Warehouse outsourcing is a great solution to avoid money losses.
- Improving the service quality and SLA. Nowadays, more and more consumers expect fast and cheap orders delivery. Moreover, retail chains even impose fines for the delay in the delivery of shipments. However, a logistics provider guarantees all partnership agreements will be respected.
- Flexible cooperation model. When a company manages its warehouse logistics by itself, it depends on a lot of many factors. However, when a company sets up a contract for providing logistics services, it can always reconsider the terms of cooperation, or just get another partner.
A disadvantage of outsourcing can be a high cost for a provider’s services. However, costs for a warehouse rental, salary for warehouse staff, purchase of equipment can be much higher, than payment to a logistics provider. Most of the time warehouse logistics outsourcing will be profitable.
A range of logistics services includes warehousing, storage of goods, customs processing, packing, returns handling, delivery, value-added services.
Among the most favored types of logistics services are:
- Outsourced warehousing and storage. The service supposes a company’s freight shifting to logistics providers. In such a case a business pays only for the space its goods take place in a 3PL’s warehouse. A logistics provider is responsible for freight safety.
- Fulfillment. The service is in great demand among companies that deal with small pieces of goods in the B2C direction. For example, fulfillment service is actual for online stores, banking businesses, etc.
- Cross-docking. The service includes orders processing, excluding long-term storage in a warehouse.
- Flow-Through. It’s a modification of the cross-docking service. The service is requested by companies that work in the B2C direction. Orders are processed in a warehouse without long-term storage. Then, they are delivered to customers.
- Bonded warehousing services. It’s a service that includes goods store and custom clearance.
- Complex logistics. It’s a full range of services to manage corporate logistics — from storage to transportation.
A company can also request from 3PLs value-added services, such as labeling, bar-coding, co-packing, reverse logistics.
For today, there are more than 30 3PL providers in the Ukrainian logistics outsourcing market. Companies need to carefully explore the capabilities of each logistics provider to find a partner that will understand business requirements and offer the best possible solutions.
Generally, it may take more than one month to find a reliable logistics provider. Companies have to conduct initial negotiations, explore rates, and discuss cooperation options with every potential contractor. Also, a business should consider a 3PL warehouse to provide proper storage conditions for products that a company works with. In common, the majority of logistics providers have been developing their expertise. So, they do not work with all types of goods simultaneously. Also, a company should take into account the time it needs to agree on cooperation conditions and operational interaction terms with the preferred logistics provider.
Just try WareTeka to reduce the time to find a suitable 3PL provider. Our platform helps to match logistics services following business requirements. We collect actual information about the rates, terms, and conditions of Ukrainian logistics providers. It means that your company can don’t waste its time searching for a logistics partner and choose a 3PL from the proposed listing.
A company reduces costs on storage facilities maintenance, as warehouse logistics outsourcing obviates the need to spend money on renting and obtaining a warehouse, recruitment, and training of personnel, salaries, purchase of warehouse equipment, etc.
Outsourcing of logistics implies that the company can use all the resources of its partner. You pay the 3PL operator only based on the work performed – for each operation. Moreover, you’ll be getting rid of clutter you don’t need. You can spend this time on business development: increase the range of products, expand sales channels and increase the level of customer service.
In the more developed markets, more and more companies prefer to outsource their non-core activities.
As storage facilities renting, equipment purchasing, and hiring are huge investments, outsourced warehouse logistics services are especially relevant for small- and medium-sized businesses. Paying based on provided services is more profitable for a company in such cases. Moreover, a logistics provider can help to develop corporate logistics from scratch and avoid operation interaction mistakes.
WareTeka collaborates with leading logistics providers on the Ukrainian market. They are such companies as Pakline Group, DB Schenker, FM Logistics, Denka Logistics, etc. Even national retailers outsource their warehousing logistics to these 3PL providers.
WareTeka guarantees the reliability of every logistics provider that is partnering with our platform. Our managers visit logistics providers’ warehouses personally or on online tours to ensure proper storage conditions. Therefore, we have actual information about the operational processes of our partners.
Moreover, we update information about unoccupied storage space and commodities neighborhoods in our partners’ warehouses permanently. When sending us a request, you can be sure to receive the latest information.
To match the best possible logistics partner, we study business needs and requirements. For example, if your company specializes in frozen foodstuffs, we’ll find a warehouse with storage conditions of -18C°. Or if your company is focused on beauty products, our platform will match a 3PL provider to solve all storage and routine operations challenges, such as labeling and packing.
Also we have ltl trucking services.