A major difficulty for businesses worldwide and in all sectors is inventory management. A significant fluctuation in supply and demand and supply chain disruption brought on by the COVID-19 pandemic has made it very challenging for companies to effectively control inventory levels throughout their end-to-end networks and prevent stockouts. According to a study, the most popular tactic currently used by supply chain leaders to lessen the effects of supply chain interruptions is “holding more inventory.”
However, retaining buffer inventory can drive up warehouse and distribution expenses, tie up working capital, and significantly negatively impact a company’s bottom line. To meet customer demand, save operational expenses, and avoid stockouts and overstock, you must maintain the proper quantity of the proper products in the proper locations at the proper times. This is a delicate balancing act. To manage the complicated chore of maintaining their inventory, many companies are increasingly turning to third-party logistics (3PL) partners today.
For any company that relies on order shipment, using a 3PL service (third-party logistics) is a great solution for cost-savings and efficiency.
In this article, we’ll discuss ways a 3PL can aid in the improvement of your inventory control.
Your inventory can be distributed across a global logistics network by a 3PL
You can utilize the provider’s global network of fulfillment centers which is one of the key advantages of outsourcing your inventory management to a 3PL. Your inventory would be as close to your customers as possible, and you can meet demands, let your 3PL use their internal analytics to strategically distribute your stock to fulfillment centers in different parts of the world.
You may automate your inventory management processes with a 3PL
Increased automation across your distribution and storage operations is another way a 3PL can assist you in optimizing your inventory. To avoid relying on unproductive manual processes for predicting consumers’ demands and trying to determine which products to stock and where, a 3PL can work with you to implement a state-of-the-art, automated inventory management software system.
A 3PL can lower your inventory costs and increase operational effectiveness
With its extensive global network, logistics know-how, and state-of-the-art software, a 3PL can assist you in managing your inventory with the highest operational and financial efficiency levels. You may automatically by giving your inventory management to a top-tier 3PL supplier:
- Create an entire (and dynamic) image of the inventory levels throughout your whole supply chain process.
- Improve how your inventory is distributed throughout the fulfillment network of your 3PL.
- Use your stocks to fill orders from customers placed anywhere, at any time, and via any channel and meet the customers’ demands effectively.
- As supply and demand conditions change, bring into line stock levels across a number of channels and across numerous fulfillment centers across the globe.
- Improve your performance in terms of on-time deliveries and client satisfaction.
- Reduce the cost of fulfilling orders, storing inventory, and other operating expenses.