Improve Compliance Documentation and Increase Savings in Your Warehouse | LoadProof

 

• 3PL business – your core competence is moving products – you can move products as pallets, as parcel boxes as shipments, as loads – it is all about moving products for other businesses, typically manufacturers or vendors that source product from the far east – because everyone wants to do what they are good at – so as a manufacturer I am good at manufacturing, so I want to find the best 3PL and outsource all my logistics, distribution, delivery, order fulfillment everything to the best in business, so I can do what I do best.
• An OEM or a Name brand vendor manufacturer is coming to you because they could go ahead and buy 1000 boxes they need to buy, rent the equipment that is needed, get the warehouse space rented out and they can do all by themselves, but if they come to you, they can take advantage of the economies of scale and the logistics expertise you bring to the table, so essentially by coming to you 3PL, they can reduce the cost, so as a 3PL Warehouse Manager you are expected to deliver on that promise, if you cannot deliver on that lower cost, then you lose that business, typically that happens if you don’t know how to run that business, how to handle all the logistical requirements in smooth fashion at a lower cost.
• 3PL business is an operations intensive business – in order to be successful in this business you have to be really good in operations, which means your operations systems have to be great, your processes have to be great, your people have to be great, the steps you are performing to complete a function, for example picking, assembly, packing, whatever it may be, you have to be very lean, very efficient, if you are not you will lose big dollars, when you lose dollars, it directly impacts your bottom line, your profitability drops, even if your top line is growing, if you lose money you are not driving towards your profits, your EBITDA is falling, which is a very bad spot to be in, then your stock price goes down, your investors are upset, wall street rates you negative, all kinds of crap you got to deal with now,
• Often the 3PLs own both warehouses and transportation infrastructure and or they have a lot of partnerships in the Supply Chain Community.
• 3PLs have warehouses that are dedicated to customers or multi-client sites, where there are multiple customers in one single facility.
• Also, from a systems perspective, they follow two models
  1. Tightly coupled model – the 3PLs systems are integrated with the customers Systems – that means systems are talking to each other.
  2. The Loosely coupled model – there is no integration – usually the 3PL personnel log on to the customers systems are operate those systems.
• As a 3PL warehouse manager, you are responsible for the following.
  • The 3PL manager leads and coordinates all aspects of the distribution process within the Supply Chain network. Leads site’s planning, execution, and communication of all daily clerical and operational processes, including:
    • Labor Planning & Driver Management.
    • OSHA, FDA and DOT Compliance.
    • General Administrative Duties
      1. Employee hiring.
      2. Payroll
    • Customer Service Responsibilities.
    • Human Resource Administration
    • Product Functionality Checks and Cleaning
    • Warehouse Functions/ Servant Leadership
    • Load Planning, Routing, and Carrier Management
    • Collection/Reporting of KPI data.
    • Sometimes you are responsible for the P&L of the site as well.
• 3PLs specialize in many things some of them are
  • Handling Food grade products – FMCG
  • FDA DEA Regulated.
  • Just keep in mind – if you are handling products that require FDA approval – you have to maintain all the documentation for up to 12 years, it could be anywhere upto 3 or 7 or 12 years. We have a customer, these guys ship health related products, every return they get, they need to maintain that returns documentation for 12 years, they have this large warehouse that has only papers – all the returns documentation from the returns they received.
  • Offering VAS – Value Added Services
    1. Price Ticketing
    2. Assembly
    3. Special packing
    4. Gift Orders – These orders are special, because the most important thing in a gift order is to wow the recipient, so it requires special skills to execute gift orders flawlessly,
  • Ecommerce fulfillment.
  • Cross Border Transportation – Mexico & Canada
• Story – about how creative this 3PL was – I was part of a team of Supply Chain Systems experts, where in I had to move a business from one 3PL to another 3PL, because this first 3PL become financially week, so I was given this project to move the business, meaning all the SKUs that were handled out of the 1st 3PL needed to be moved to the 2nd 3PL and the associated SAP systems work had to be done super-fast – And we got it done, this was one of the largest projects I had ever done – the 2nd 3PL was so creative in making things happen, these guys had made these small light weight carts to perform the parts batch picking process, they had just gone to Home depot, bought all these PVC pipes and glued it together to make low cost carts that were one third the price of the carts you would buy normally.
• Food 3PL is one of the toughest businesses ever.
• Typically, you are shipping on behalf of a OEM or a brand named manufacturer.
• You typically get heat from 2 sides.
  1. If you are shipping to a retailer, and if the retailer imposes chargebacks, you will have to take heat from your OEM and the retailer.
  2. If you are shipping to somebody on behalf of the OEM or a name brand vendor/manufacturer, if there is a damage, again you have to take heat both from the OEM/name brand vendor/manufacturer, but also the Receiver.
  3. If there are damages, the same thing.
  4. If there are shortages, the same thing.
  5. And you cannot just piss off a retailer or a carrier, because you have to do business with them again and again – so you really have to work on this long term – be fair to all the parties and still CYA as well as make money for offering your services
• Often you have to absorb costs even though it is not your fault

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