Shippers 'require 3PL providers to mitigate supply chain risks'

02 October 2012

Posted by Samuel Couratin

Pressure is growing from their customers for third-party logistics (3PL) providers to mitigate supply chain risks.

This is the conclusion reached by a new study, which examines the current global market for 3PL services provided to shippers.

It has been published by Capgemini Consulting and produced in conjunction with Panalpina, Penn State University and Korn/Ferry International, with more than 2,300 shippers and logistics service providers polled around the world.

According to the research, meeting high business continuity standards is becoming increasingly important to shippers, which are increasingly looking towards 3PL providers to meet their needs and innovate within their supply chains.

According to the 17th annual iteration of the study, 65 per cent of shippers have raised their usage of 3PL services in the past year as the difficult economic climate continues and competition between firms continues.

Shippers perceive their 3PL partners as key providers of risk mitigation and supply chain innovation, as they seek further value and competitive differentiation in the market.

As a result, demands from companies are becoming more complex as they look for solutions that will create new routes to growth.

However, many remain concerned about the ability of 3PLs to carry out disruptive innovation, with 53 per cent of shippers feeling providers are prepared to operate at the required strategic level.

Commenting on the results of the survey, Dan Albright, Capgemini Consulting Vice President and North American Supply Chain Leader, stated: "It takes truly collaborative, strategic relationships among all partners involved to develop the kinds of disruptive innovations it will take to solve the challenges facing today's supply chains."

According to the report, supply chains have become more complex and more vulnerable to the effects of external forces, making business continuity planning more important than ever and lean processes increasing risk in this area.

The greatest threats to logistics operations were found to be pandemics or adverse weather conditions, with volatile commodity, labour and energy markets also a key concern among shippers.

Major events such as last year's flooding in Thailand and the devastating Japanese earthquake and tsunami had a major impact on global supply chains.

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