For any company in any industry, it is highly important to set forth your business strategy and remain committed to it to achieve your best results. However, it is also important to be nimble, agile and have the ability to adapt your business strategy when the market or outside circumstances require it. One such instance – and one we are all still adjusting for – is the worldwide COVID-19 pandemic. Many companies had to think outside of the box to keep going while others were unable to adapt and had to shut down temporarily and, in some cases, permanently. However, not all instances that require a business to pivot strategy are global tragedies. They can be smaller things like a change in consumer habits, increased competition, new governmental mandates, etc. Often these issues can help businesses realize a shift in thinking or in business strategy could benefit their bottom line.
Challenges to 3PLs
While 3PLs were the market leaders in adopting new technology and were the first to deliver multi carrier ratings through a single service, carriers are now leveling the playing field by offering multicarrier rate engines through their own applications to compete with the transportation management systems (TMS) offered through 3PLs.
Additionally, LTL carriers are offering more competitive rates to smaller shippers through a dynamic pricing model while also moving 3PLs to a similar dynamic tariff to combat annual blanket pricing for all of the 3PLs’ shipper customers. These price rates are more easily able to fluctuate with market demand, benefiting carriers and making negotiating their own pricing more appealing to even smaller shippers who traditionally benefited from the 3PLs access to better pricing because of their freight capacity.
Because of this increased competition, it is important for 3PLs to be able to adjust their strategy and not stay stagnant. By developing ways to add to or pivot their business plan, 3PLs will be able to innovate and stay ahead of the pack in an ever-increasing competitive environment.
Banyan Technology has outlined Five Strategies for 3PLs to Boost Their Value, cut through the competitiveness of the marketplace and secure the continual business of their customers.