Location: Six Critical Factors When Choosing the Right 3PL Partner
The Important of Location in 3PL Partner Warehousing
By: Dave Jesse, COO
In my July post in our six-part series on the Six Critical Factors When Choosing a 3PL Partner, it’s all about location, location, location. If you have missed any posts in our series (intro, leadership, agility) you can read up by clicking HERE.
One frequently undervalued detail when dealing with a 3PL is the strategic location of their warehouses. Let’s delve into why the geographical placement of these facilities is important.
PROXIMITY TO MARKET
The primary advantage of a well-located 3PL warehouse is its proximity to target markets for outbound orders and proximity to the ports for importing goods to sell. Reduced transportation time and costs enable faster delivery, meeting customer delivery expectations and enhancing overall satisfaction. North Carolina, located in the middle of the east coast between Boston and Miami, ranked fourth by Forbes when assessing favorable business costs. The access to rail and the capabilities to reach a whopping 70% of the US population in one day results in lower logistics costs.
PROXIMITY TO PORTS
Whether you are importing goods from overseas or exporting product to end customers, proximity to the ports can help reduce lead times. With the continued congestion at the major ports in the U.S. it’s an advantage to have a 3PL like Bonded with a presence and relationship at the local ports you deal with to aid in getting inventory in and out of the country. Wilmington, Charleston and Savannah as well as two inland ports and freight rail systems makes it easy to maintain a central hub on the east coast.
OPTIMIZED TRANSPORTATION NETWORKS
A strategically placed warehouse contributes to the optimization of transportation networks. Efficient routes and reduced transit times result in cost savings and streamlined logistics operations.
REDUCED SHIPPING COSTS
Closer proximity to end-users or retail outlets translates to lower shipping costs. By strategically positioning warehouses, companies can minimize expenses associated with transportation. Major highways like I-77, I-85, I-95 and I-40 each cross the state of North Carolina which helps support the speed of your supply chain.
IMPROVED INVENTORY MANAGEMENT
Location plays a key role in inventory management. Placing warehouses strategically ensures that stock is positioned where it is most needed, minimizing stockouts, and improving order fulfillment times.
MARKET EXPANSION OPPORTUNITIES
Well-positioned 3PL partners open avenues for market expansion. They enable companies to enter new regions and serve a broader customer base, capturing untapped markets where the 3PL’s have other locations to increase overall market share.
RISK MITIGATION
Strategic placement of warehouses helps in mitigating risks. Diversifying locations minimizes the impact of natural disasters, geopolitical issues, or other unforeseen events, ensure continuity in supply chain operations.
SEASONAL DEMAND CONSIDERATIONS
Location becomes particularly critical when dealing with seasonal demand. Warehouses strategically positioned to accommodate seasonal spikes can efficiently manage increased order volumes and maintain service levels without disruptions.
CUSTOMER SATISFACTION
Timely and reliable deliveries directly to customers contribute to overall customer satisfaction. A 3PL partner with warehouses in strategic locations ensures that products reach customers promptly, fostering loyalty and positive brand perception.
REGULATORY COMPLIANCE
Different regions often have specific regulations regarding product storage and transportation. Locating warehouses strategically helps in complying with unique regulatory requirements, avoiding legal complications.
CONCLUSION
The geographical location of 3PL partner warehouses like our facilities in Charlotte is not just a logistical detail; it’s a strategic imperative. Companies that recognize the importance of this factor can harness the full potential of their supply chain, ensuring efficiency, cost-effectiveness, and a competitive edge in the market.
Do you have any questions, comments or are ready to start a conversation? Reach out to my team by clicking HERE.