Choosing the right 3PL

There has been a lot of talk recently in regards to technology in the marketplace, and it’s utilization by new age 3PL’s. The general consensus that everyone seems to be talking about is how today’s brokers will soon be phased out if they do not harness emerging technologies. After all, it is 2019… The “Internet” recently passed the Quarter Century mark, and technology has been growing at an exponential pace ever since its inception. 3PL’s have been around for decades, and many industry experts will tell you that the services offered have not matured on pace with the industry as a whole. The answer to questions such as this varies greatly, depending on the traits that you find most valuable in your strategic partnerships.

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The technology offerings in the marketplace are extremely diverse, and their resources seem endless. Often marketed as a selling point to current and prospective clients, 3PL’s are using innovative technology to differentiate themselves from their competition. The mythical allure of becoming and industry disruptor has led everyone to anticipate the next big innovation that will take an industry, or a culture, entirely by storm. Are you willing to miss out on this opportunity to impress your (insert: clients, boss, peers, neighbors, in-laws, dog sitter, etc.) by passing up this valuable information? The business world, and society as whole, has an insatiable demand for instant gratification, and the pressure to keep pace is unrelenting. Not to mention these technology companies typically possess an impressive sales force that is highly trained on how to instill urgency by playing on our ever-growing fear of missing out. It is increasingly easy to get caught up in having the newest and shiniest toy to show off in class.

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However, that is not to say new technology does not offer value by making all of our lives easier. Dashcams are changing the face of workplace safety in transportation. Algorithms are taking historical rate data, and being used to commoditize pricing in the form of freight futures. Artificial Intelligence is improving daily, and we already have self-driving cars. It is not a matter of “if,” but “when” will those technologies make an impact on our industry. As much as everyone fought it, the ELD mandate did change the industry significantly, and there was no way anyone could avoid it. The bottom line is, the implementation of certain technologies is inevitable. The trouble is, no one knows what the new standard will be in 5-10 years. If a 3PL’s value proposition relies on their use of technology, how will their functionality change over time as new technology is introduced into the marketplace? Will their “groundbreaking” products and services still be relevant in an uncertain future? 

On the other hand, brokers are inherently in tune with market fluctuations. 3PL’s must adjust their approach on virtually a daily basis, and because they do this so frequently, it is easy to lose sight of the small innovations that are constantly taking place. These Old Salt industry experts know when produce seasons are going to inflate prices and suck up capacity. They also have the long-standing relationships with other vendors that will help them get the job done no matter what. They have been around long enough to know what the industry is like at both its best, and its worst. They may not be reinventing the wheel, but neither is the railroad industry, and our countries economy is still firmly dependent on the functionality of that industry which has literally been around since before any of us were born. Sure, the railroads have had to adjust over the years, but the same is true for any business that expects to outlast its current owner. On a foundational level, the railroads are still offering the same services they were over 100 years ago. 

Many of these relationships go on for years, and will grow into something quite special. In those relationship formed over time, we develop a certain level of expertise that cannot be bought or taught by anyone other than those directly involved. Maybe you have a customer that prefers phone calls over emails, or maybe you know the only time to catch that person on the phone is after hours. No technology can teach you these finer details, and they only become apparent over time. New technology might be able to help you forecast what is possible based on the past, but no technology can help you stop a tornado or an earthquake. New people learn how to fly planes and captain boats every day, but they still have to train for years before they are given total control of the vessel.

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So, the question truly lies within, what is more important to you and your business? While some level of innovation and change is necessary to remain competitive, that does not mean your 3PL needs to go reinventing the wheel, or the internet, or whatever the next big “thing” is. What will not lose its value is a trusted partner that knows the intimate details of your business, and ultimately has your collective best interest at heart, there is no one size fits all answer. As long as we have a free market, there will be opportunities for both styles of business to be successful. The discerning customer is more empowered now, than ever before. With a little research, you can truly find a solution that fits your company’s needs, and at the same time, satisfies your own personal preferences.

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If you would like to have a conversation about how we can help build your Roadmap For Success Contact ARL Logistics and we are happy to answer any questions you may have!