3PL Directories and Logistics Buyers Guides

Finding the right logistics provider can be a challenging and sometimes overwhelming process. That is one of the major reasons why I started Logistics List. By searching through our 3PL directory and reading features on logistics trends and selection criteria, I sincerely hope you are helped in the process of finding the right third party logistics provider for your company.

The internet is a great resource for finding relevant logistics directories and you will find great information to aid in 3PL selection, but by all means you should consider exploring another avenues as well.

You will continue to hear about the death of print and trade magazines but I still feel it is very worthwhile getting a hold of a few free Logistics Buyers guides to supplement your online research. A few buyers guides that I would highly recommend are:

American Public Warehouse Register (APWR): published annually and can be obtained for free with a subscription to Logistics Management. I personally find this to be the best organized and easy to navigate of the logistics directories.

Inbound Logistics Planner : Another annually published 3^rd party logistics directory which typically comes out in January is usually included free with a subscription to Inbound Logistics Magazine.

Logistics Today Buyers Guide: This is the official buyers guide/directory for Logistics Today magazine which typically is published in Aug/Sept. The guide is also included with a subscription.

Also, I know this is obvious but get out there and talk to people! Ask your colleagues and friends about logistics companies they’ve had experiences with. Go to logistics conferences held by organizations like WERC and CSCMP. Find out what others in your industry actually think about the companies that you’ve been researching or about outsourcing logistics in general. This is crucial not just for selecting a logistics provider but for just about anything in business.

Third Party Logistics and Fortune 500 Companies

A recent article in Logistics Quarterly noted that 2/3 of the revenues from North American third party logistics companies are dominated by Fortune 500 companies. As logistics outsourcing has become more common and the solutions that 3PLs provide more effective, the world’s largest companies are turning to trusted logistics companies to fine tune their supply chain and find and fix inefficiencies.

When looking at the most utilized supply chain management services by companies outsourcing logistics here are the most used logistics services broken down by industry for companies in the Fortune 500:

• Transportation management and value added logistics services are the primary services purchased by automotive companies.

• Transportation management and warehousing are the leading services for the food and grocery, industrial, and retail companies.

• Warehousing is the most purchased service for technology, healthcare and consumer goods companies.

Logistics Costs

A recent study that I received from the recent CSCMP conference in San Diego called "Trends & Strategies in Logistics: Agenda for Logistics Management 2010" is a great overview of where the logistics industry is going in the future. One of the topics covered in the study was Logistics Costs as a percentage of a company’s total overall costs broken down by sector.

Logistics Costs as percentage of total costs

Food - 8.0%

Chemical - 6.9%

Machine Construction - 6.0%

High Tech - 5.2%

Automotive - 5.1%

• Depending on sector, logistics costs account on average between 5 and 8 percent of total costs

• Little or no standardized allocation of logistics costs and services

• Machine Construction, high tech and automotive investing increasing sums in logistics

This is interesting information to take a look at if you are in the process of outsourcing your logistics function? What percentage of your company's total costs are spent on logistics services and management? Is your spending on the high side for your industry, can your numbers use some improvement?

Sometimes this is one of the reasons used as justification for working with third party logistics companies.

The Trends and Strategies in Logistics study was conducted by Bundesvereinigung Logistik (BVL) e.V.

Logistics in Chicago

Chicago is by far one of the best cities in the United States for Logistics. And its not just because I live there or because Logistics Today named Chicago the #3 most logistics friendly city in the country for 2005. Sure it gets pretty cold over here in the winters but if you are looking for a central location to run your distribution program then Chicago definitely needs to be considered when outsourcing your company's logistics.

• Chicago is home to one of the countries most extensive transportation infrastructures and provides flexible, efficient service for every mode of transportation.

• Illinois features 2,000 miles of interstate highway and 3 interstates (I-80, I-90, and I-70). There is also an abundance of terminals, freight forwarders and transportation companies.

• Chicago is the largest hub for railroad distribution in the country with more than 50 railroads providing service from Illinois to the entire country. It is also home to the country's largest switching yard the Belt Railway.

• Chicago's O'Hare Airport is the second largest airport in the country shipping more than 1.6 million tons of cargo each year.

Chicago is also home to a large number of respected logistics companies offering integrated warehousing and transportation services. In fact in the Nov. 05' issue of Business 2.0, the third party logistics industry was named one of the largest upcoming growth industries for the Chicago area and its megapolitan. This provides hope for greater competition in the future, creating greater opportunity and more comprenhensive service offerings for companies outsourcing logistics services in Chicago.

Currently Logistics companies in Chicago typically provide excellent rail distribution service and are also able to leverage their central location to offer service efficiencies and excellent TL and LTL delivery times that can't always be found in some metropolitan areas.

The Chicago area is definitely a point to be strongly considered as part of your distribution program. With the continued growth of the Illinois logistics industry I believe it will retain its title as one of the most effective areas in the country for third party logistics services.

Sources:
Logistics in Illinois
The Top Logistics Friendly Cities in the US, 2005