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Case Studies -> Third Party Logistics/3PL |
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3PLs exceed other warehousing and distribution
challenges. Many companies solve warehouse and transportation issues
by out-sourcing functions to “experts in managing inventory”
and warehousing. Great software and hardware that performs exquisitely
in ordinary owner-controlled inventory can crash in this more demanding
setting.
Often the difference between a good fit or not, makes the difference
between a 3PL making a profit or going broke. It is easy to lose
revenue by not billing for agreed services that were manually tracked
but not invoiced or properly documented.
Acquiring a customer is hard work but losing one is easy and permanent.
Imagine causing a client to be fined thousands of dollars because
labels didn’t scan or ASN notices that weren’t to specification?
Better solutions must be provided to 3PLs than any other client
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Reasons are
numerous, but a few of most significance are:
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Required billing needs
slated by contract with each client/owner of the inventory
managed within the warehouse. This billing can be by function
(receiving, put-away, pick, wrap, pack, label, palletizing,
shipment etc.), space (assigned, dimension), time (days
warehoused with cut-off possibilities of in by 15th charge
from 1st or after 15th charge from 1st of next month) or
other criteria that could include notices to customers (inventory
owners), the shipment receiver, the carrier or each simultaneously
with different data. |
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Kitting (including various sku’s to create a new sku
or assembled unit) |
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Ongoing web visibility of inventory,
order or shipment status. |
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Replenishment. |
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Ongoing physical inventory counts and
reports by scheduled location and frequency with variance
solutions.(Cycle Counting) |
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Transportation management with multi
mode (TL, LTL, Package, Fleet, USPS) and carrier communication
that includes prepay and add, collect, 3rd party and consignee
billing options, uploads, labeling, Manifesting, BOL, packing
list and compliance label printing. |
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EDI eCommerce partner set compliance
with ASNs (advanced shipping notices) or pseudo-ASN (using
e-mail or fax) as well as custom compliant product labeling
and packing lists. Other EDI requirements transmit and receive
Purchase Orders, Invoices, Checks, and Acknowledgements.
EDI transaction have become more common as companies eliminate
the error potential intrinsic in non-automated transfers
of information. |
3PL’s
must provide services at a profit for less than the client
believes it will cost him to do it internally. |
Alcazar Ltd
provided evaluation, solution design and WMS selection for
each project. Part of the planning process was training
the trainers in what was available as solutions before a
specific specification was written. The intent was to include
each option that had a corresponding ROI and eliminate options
that had no apparent value. Because warehousing sometimes
works on lean margins, each solution needed projected return
calculations. Each of these listed projects met or exceeded
their initial objectives. They were also kept on budget
and 2 of the 3 were kept on schedule. One was over 2 years
behind schedule because the management preferred to delay
until “one more client” came on board. Eventually,
even this client was implemented, although, cost of implementation
was higher because of the need to re-train, re-think and
familiarize after each delay. |
Alcazar Ltd
has included funding through supplied leasing.
An entire project can be funded over a 3-year term from
monthly savings. |
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