Uncertainty continues to negatively impact global supply chains. Port congestion, capacity constraints and surging freight rates are often compounded by other, more common events like environmental disasters. Thankfully, there is a tangible solution.
Shippers can partner with a fourth-party logistics (4PL) service provider to manage their logistics carriers and navigate the turbulent environment. OIA Global 4PL partners with your business to understand common logistics priorities and determine a strategic focus. If disruption occurs, OIA can tweak plans accordingly or provide a completely new approach.
In this article, we detail how a 4PL service provider can shape your supply chains for resiliency and adaptability. It’s time to adjust to the new normal.
Industry stakeholders recognize that current volatility will not return to normal anytime soon. A key to long-term competitiveness is the ability to function when issues arise. An inherent strength of a 4PL service provider is business continuity. During disruptive events, 4PLs leverage their expertise and resources to help you find solutions, minimize your risk and avoid potential fallout in your supply chain.
A 4PL can ensure business continuity by leveraging prescriptive analytics to predict future scenarios. Prescient insights ensure that your company is aware of any supply chain disruptions, allowing you to make data-driven decisions and mitigate issues before they occur.
A 4PL manages contracted carriers on your behalf, allowing you to focus on your core business strengths. 4PLs leverage past market experiences as well as system capabilities—spot quotes, tender management, etc.—to provide you with options when booking shipments. You can choose when to switch to a carrier that better aligns with your business needs. This provides you with additional volume that may be needed when managing a surge in orders or to meet on-time delivery requirements.
Lastly, a 4PL service provider manages the onboarding process for newly contracted carriers. As the single point of contact, 4PLs are responsible for managing integrations and data connections with your logistic service providers, thus saving you the potential headache. OIA also conducts regular audits and stays in sync with developing global compliance, so your shipments won’t require corrective action.
Real-time Supply Chain Visibility
The pandemic has reiterated that constant supply chain visibility is critical when making impactful decisions. Poor visibility can limit your ability to detect emerging threats or to calculate how disruption will unfold across different business units and geographies.
By 2023, 50% of leading global enterprises will have invested in real-time visibility solutions according to a study by Gartner.
4PLs offer advanced technology platforms that connect multiple data sources and integrate supply chain data cohesively. This helps you to achieve real-time visibility through a single comprehensive source. You can receive real-time data about potential supply chain constraints, including transport availability or delays at a particular port, and then take corrective action as needed.
OIA Connect is our platform that provides customers with real-time, detailed insights on shipments and event statuses. The platform has strong data visualization capabilities: users can differentiate between high-level overviews and specific details for each shipment. Its technical architecture also provides users with customization and control, allowing them to use Connect however it best satisfies their needs.
Unfortunately, canceled services, rolling bookings, blank sailings and congestion have become common for both imports and exports. OIA’s 4PL team acts as a control tower and partners with customers to find alternative yet reliable routes. One example: when the pandemic emerged, OIA supported 4PL customers with a prescient switch to rail freight connections between China and Europe. The rail connections had been proposed prior to the pandemic as alternatives because of their faster lead-times, and they were a cogent solution as disruptions and capacity constraints increased.
With scenario planning, a 4PL can act in several ways:
- Identify potential risk areas in your supply chain
- Visualize how disruption will affect your supply chain
- Develop specific action plans to solve problems if they arise
Procurement & Vendor Management
Mitigating risk requires an established and intelligent procurement system. 4PLs manage procurement capacity based on market fluctuations and shifts in supply and demand. OIA can support organizations in their logistics tender process as well as provide spot quotes for new lanes or single shipments.
If you need ten containers shipped tomorrow from Shenzhen to Rotterdam, a 4PL will handle the procurement and search for the right service and best available rates on a particular trade lane.
A 4PL makes your supply chain more resilient by modifying how you spread risk and changing your procurement model as needed.
New vendors can be introduced to provide you with alternative solutions or to avoid repetitive, negative impacts on your business.
A 4PL can handle your vendor management process to implement the right systems, processes and metrics. Offloading these initiatives will allow your organization to allocate important resources elsewhere.
Customized Solutions to Meet Your Supply Chain Needs
A one-size-fits-all approach to logistics is no longer pragmatic or effective. To succeed in today’s marketplace, you need innovative, customized solutions that satisfy your company’s specific business needs. Finding the proper solution increases efficiency, promotes sustainable competitiveness and enables complexity throughout the supply chain.
OIA’s 4PL team consists of experts with extensive logistics experience who can build tailored solutions to circumvent business challenges. Specifically, we take a consultative approach to study your end-to-end supply chain and then offer solutions that make it agile, lean and resilient. As your 4PL service provider, we maintain a neutral position and thus provide solutions that are intended to reduce costs. We work to maximize our customers’ growth potential.