Case Study Series. Outsourcing to a 3PL
Outsourcing may seem like daunting task, but companies like Hopkins Distribution makes it easy to transition. We are a third party logistics (3PL) provider with a wide array of highly technical yet cost-efficient options for fulfillment, distribution and warehousing challenges. Many companies have great success with using a 3PL company so they can focus on their strengths and leave the supply chain management to their third party logistic providers. The following case study revolves around the Goodyear Tire & Rubber Company and their success with outsourcing to a 3PL. First, we will explain what a 3PL is how it can help your business.
What is a 3PL?
A 3PL is a third party company that businesses will use to outsource elements of distribution, warehousing and fulfillment services. Since 3PL companies specialize and focus on operations like warehousing and transportation, these services can be customized to the customer’s needs to meet demands and delivery requirements. Let’s say you are in the business of producing teddy bears. You specialize in the type of stuffing used, exterior material, how it gets sewed and the overall design and look of the teddy bear. There are children all over the world that want teddy bears, yet you do not have additional capital to invest in trucks to deliver them. Your supply chain consists of aspects like order placement, inventory management, merchandise storage, warehouse packing and transportation. This is a large part of your company’s operation in which many people do not have much experience in. You would need to hire warehouse managers, floor packers, truck drivers, etc. A 3PL company takes care of this part of your operation and you still have control and transparency in details like inventory levels on a 24 hour basis and shipment tracking. Features like inventory levels and shipment tracking are a part of logistic application development. Check out this helpful page on logistic application development to learn more about the various areas of control and transparency you receive when you use a 3PL company.
Case Study: The Goodyear Tire & Rubber Company
The case takes place in 2002 to 2003 when Patrick Hurley was the company’s vice president-supply chain. Responsibilities of his job included functional organizations such as planning, call centers, order management, pricing administration, distribution and delivery, and billing and accounts receivable processes. Goodyear hired a logistics provider originally to operate its distribution centers and perform other functional duties, but their relationship grew into much more than that. Goodyear was interested in what 3PLs could do beyond warehousing and transportation, so they narrowed down their list of potential companies until they settled on one to have a meeting with. The 3PL provider evolved into a strategic partner, one who eventually helped redesign Goodyear’s distribution network. In this way, the 3PL as a strategic partner focused on saving Goodyear money in the way their supply chain operated (cutting costs with other companies Goodyear used in their supply chain and more efficient planning they gained in their experience). As Patrick Hurley said, “Goodyear’s core competence is not logistics – but we do need to make the supply chain a competitive advantage. The only way we’ll do that is by partnering with world-class companies to get the job done.”
Hopkins Distribution Company. Professional and Superior 3PL
Hopkins Distribution Company is a leading 3PL company that has grown to become a major logistics participant in the public warehouse industry in Nevada with heavy concentration on regional distribution to North America. We are committed to improving the performance and profitability of our customers by providing custom tailored warehousing and distribution solutions. Every order that is processed by Hopkins Distribution Company is triple checked, which enables Hopkins to post 99.985% accuracy ratings for order processing and inventory accountability. Check out our services page to see how we can help your company grow.