3PL? In-House? Both?

There is no "one size fits all" solution to the ways in which you spend money for new and critical infrastructure for your warehouse. No two organizations are created equally and the needs and even the preferences of one will vary wildly when compared to those of even its closest competitor. This is especially true when it comes to logistics solutions that warehouses are relying on more and more heavily with each passing day. Some organizations are turning towards outsourcing to third party logistics (3PL) providers in an effort to save time, money and energy. Others are choosing to continue to handle all logistics services in-house, while others still are using a combination of the two. Which decision is right for your organization? It will depend on your goals as well as the type of business that you're running.

You're Not Making the Last Logistics Decision You'll Ever Make

One of the most important considerations to make when deciding between third party logistics and in-house logistics for your warehouse is the simple fact that you can change your mind in the future if you so choose. Many people believe that if they choose third party logistics now, they're stuck with that decision forever. While this used to be the case, it is no longer true thanks to the ways in which the roles of 3PLs has naturally grown and evolved over time. The very nature of supply chains has changed and 3PLs have had to change along with it.

As a result, you can always "walk back" from your decision if you so choose. It may make sense to bring certain functions back in-house in a few years as the needs of your warehouse changes - that's perfectly acceptable.

3PL vs. In-House Logistics: Why Not Both?

One of the biggest mistakes that people make regarding logistics solutions involves assuming that it has to be an "either/or" decision. The fact of the matter is that in 2015 and beyond, in-house logistics and third party logistics providers are not mutually exclusive. Many service providers have started to offer more hybrid solutions in the last few years, with something like managed transportation being just one of many examples. Thanks to the ways in which the landscape is changing, you're essentially in the best possible position: you can outsource what it makes sense to outsource and let everything else stay in-house. Everybody wins.

The 23 Percent

In a survey that was conducted on Logisticsviewpoints.com, it was revealed that out of 102 respondents, a full 23 percent of them were not currently working with a third party logistics provider. Though the survey did have a relatively small sample size, 23% is still a large number that is worth considering.

The reasons why those 23% of respondents chose to use in-house logistics fell into two different categories: either they genuinely believed that they could do a better job in terms of cost or quality in house, or they fully admitted to having not explored the option of outsourcing at all.

The first reason is an excellent argument towards picking in-house logistics for your warehouse. If you truly believe that you can deliver better quality work at a lower cost on your own, it doesn't make sense to outsource. However, if you're like the respondents who admitted to not outsourcing simply because they "haven't explored it as an option," you could potentially be doing your employees, your clients and your organization as a whole a grave disservice. If there is an option out there that could potentially free up valuable resources, save money and make the lives of both you and your employees easier, you owe it to everyone involved to explore that option from every possible angle to at least see if it could be an appropriate fit.

Conclusion

When it comes to choosing between 3PL and in-house logistics, there are always a few key things to keep in mind. For starters, you need to find a solution that is right for your business - not anyone else's. Additionally, you have to think about scalability. Whichever decision you make needs to be able to properly serve not only the business you're running now, but the shape that business will take five, ten and even twenty years into the future. There is no universal "right" or "wrong" answer when it comes to 3PL versus in-house logistics - as always, the decision is one that only you can make.