3PL is essentially a resource coordinator and organizer, matching the logistics needs of Party A in the form of solutions. Contract logistics projects are generally obtained through bidding or negotiation, and there are different project stages from the early business, investment implementation to stable operation and profit period. The early development process of 3PL business is also a process of customizing solutions. If you want to succeed in project operation, you must do your homework before starting and fully understand customer needs. Usually, cases are what customers are most concerned about. If there are no relevant cases to refer to and complete market information, the relevant proposed solutions may have risk points.
Based on the issues that customers are concerned about (logistics selection, planning and operation management authority), write a proposal, produce a solution, main design and roadmap, and prepare detailed answers to customer RFQs. It is best to highlight the highlights that are better than competitors, such as reliability and technology. Conduct hypothesis analysis on the collected data, evaluate the operational design of manpower, warehouses, SKUs, shipping volume and route points, and calculate the relationship between business scope, cargo volume changes and quotation system. For example, in order to control project risks, the quotation model adopts a step-by-step price calculation based on the actual business volume, or on the basis of being familiar with each other’s needs, the overall cost is formulated by combining fixed and variable costs, and the risks are shared. Many talents in the logistics departments of enterprises come from professional logistics companies. They have a better understanding of the logistics links, which makes the price highly transparent and makes cooperation simpler. “Outsourcing joint ventures” only earn customer management fees, and there is no price difference in the contract.
Large companies will outsource logistics business to different 3PLs to avoid single procurement and dynamically adjust business volume by setting KPI assessment indicators. Contract logistics projects require a certain profit period. Many projects with warehousing and system docking are loss-making in the initial investment, so the contract period should not be too short, and Party A will also have costs for changing logistics partners.
Whenever a contract is signed, 3PL will have detailed commercial terms, which will mention the required service level commitment. Logistics companies must formulate appropriate standard operating procedures (SOPs) according to this standard. Sometimes the SOP main process will also become an annex to the contract, and the project operation team will execute according to this process. Usually, the pre-sales (BD) or account manager (KA) responds to the first-hand needs of customers, and the project manager or product manager (PM) organizes the key implementation steps and plan list. Although there are fewer functional departments involved in the early stage, the participation process will be implemented in detail in this stage. If too many personalized requirements are promised in the business stage, the implementation of the project may be too expensive. An excellent 3PL must be a logistics company with technological capabilities, using information technology as an organizational tool and data as an optimization driver to connect upstream and downstream resources and achieve solution output. Different projects may have different SOPs, and even the project team needs to have an independent management system. When the project goes online, the entire process must be tested repeatedly to ensure that it does not fall off the chain at the critical moment of operation. For example, after-sales, home delivery and other projects that need to face consumers are relatively difficult to handle and require special customer service teams. The quality control management of couriers is sometimes difficult to reach.
The loss of a customer by a courier will not have a big impact on the company as a whole, but 3PL is different. If a large customer is lost, a large amount of income may be lost, and even the team may be disbanded. 3PL has a scale bottleneck, that is, it cannot productize services, the operation process cannot be replicated in various projects, and the more and larger the contract logistics projects are, the more difficult it is to manage. Therefore, the organizational structure must be continuously optimized, otherwise it will not be able to support the change in scale, but the management hierarchy is very unfavorable to the project system. When the project is running on track, it is still often faced with various business changes, cost optimization and other demands, which puts the project maintenance in a dilemma. Therefore, in order to gradually achieve a balance between resource integration and cost control, 3PL often proposes phased small internal projects in the form of workshops to improve KPIs through continuous optimization. Most projects are very dependent on the business growth of Party A, and once the customer’s product or market declines and puts forward cost demands, since the project cost is already very transparent, the project may gradually enter the offline stage. Cross-border logistics is more about creating a standardized operation system and a universal channel, but when facing large customers and segmented sellers, project management is also very necessary.