Quality Material Handling Inc. Logo

Call QMH Inc. Today (800) 404-RACK

Over 30 Years of Material Handling Excellence

Contractor License #731100 (B, D34)

Posted by Stephanie on March 4, 2024

Modern supply chain management is all about optimization to ensure goods are efficiently delivered. Businesses often hire logistics managers to fulfill their orders and take control of their supply chain. These managers can partner with logistics companies to outsource order fulfillment and other tasks. Logistics companies can help reduce shipping costs, boost customer satisfaction, and improve delivery speeds. 

This guide takes an in-depth look at logistics companies and what they do. You’ll learn about the advantages of hiring these companies and the types of tasks they can perform. You’ll also discover how to choose a logistics company that meets your company’s needs.

warehouse workers

Defining Logistics Companies

Logistics companies are tasked with planning, implementing, and controlling the storage and transportation of goods and services as part of a supply chain. These companies can be responsible for goods, information, and services from their point of origin to their consumption. When businesses hire this type of company to handle their logistical needs, they can choose if some or all of their supply chain functions are taken care of. 

Over the years, logistics has evolved alongside consumerism. Today, it’s critical to maintain and grow complex supply chains. Many logistics companies have the expertise needed to perform their services in a globalized manner. The supply chain functions that a logistics company can handle include the following:

  • Storage
  • Shipping
  • Transportation
  • Management
  • Receiving

They can also be involved in warehousing, inventory, packaging, and material handling.

Benefits of Partnering with Logistics Companies

Expansion: Partnering with logistics companies can be highly advantageous for any business looking to grow. Entering this type of partnership can help you expand into new markets without substantial resource investment. You use your company’s resources to maintain storage space and staff pay. You can reduce costs by outsourcing distribution and inventory management to a reputable logistics company. 

Risk Reduction: Outsourcing logistics management can help mitigate the many risks associated with transportation issues and delays. While delays are unavoidable when transporting goods, logistics companies can more effectively manage delivery times and organization. They can also research alternative forms of transportation that can resolve delays.

Growth: When you partner with a logistics company, your business can focus on growth without needing to dedicate considerable time to your logistical needs. If your business is still in the startup stage or has yet to grow, you can take the next step by hiring a logistics company. Duties like customs brokerage and clearance can be time-consuming. By outsourcing these issues to an external logistics company, your business can focus on preparing products for the market.

Stress Reduction: Logistics companies should also be able to help you simplify your shipping processes and reduce administrative burdens. If your business ships goods internationally, a lot of paperwork must be filled out to transport your items to their intended destinations. Shipping logistics involves such documents as:

  • Bills of lading
  • Air waybills
  • Customs declarations
  • Packing lists
  • Commercial invoices

If you partner with a logistics company, they can simplify the shipping process and help you complete the necessary paperwork.

Customer Service: Logistics companies contribute to efficient deliveries and customer satisfaction. By keeping customers satisfied, their loyalty should increase. When delivering goods, there’s always a specific schedule that must be met. If your goods aren’t delivered promptly, you may find it challenging to satisfy your customers. 

Savings: There are plenty of cost-saving opportunities available to you by outsourcing logistics management and obtaining competitive shipping rates. An experienced third-party company can handle everything from transportation management to warehousing. Their industry knowledge may allow them to identify the best and most affordable methods for shipping goods

Types of Logistics Companies

Only some logistics companies do the same thing. Some companies specialize in specific parts of the industry. For example, it’s possible to focus entirely on transportation. The many logistics providers include everything from carriers to freight companies.

Freight Companies: A freight company is a logistics provider that transports goods internationally or domestically. If you manage a small business, you can find companies focusing on domestic freight, which might save you money. Freight companies can also specialize in different transportation methods. For example, this type of company may only offer sea freight services. 

Freight Forwarders: These companies are facilitators in the supply chain, meaning they focus on using their networks to optimize transportation. They work closely with clients to identify their needs and find the best solutions. Along with setting up transportation, they’ll also take care of import and export documentation. Freight forwarders often work with multiple carriers to complete their tasks efficiently. 

Carriers: A carrier is a logistics company offering comprehensive transportation services. They can provide these services to businesses in any industry. Their shipping solutions may be international as well. Carriers can include ocean, trucking, air, and rail freight companies.

Third-party Logistics (3PL) Companies: These companies offer extensive supply chain solutions, which include transportation, packaging, order management, and warehousing. A 3PL company can manage your entire supply chain

Factors to Consider When Choosing a Logistics Company

It would be best to consider numerous factors when choosing a logistics company, including everything from transport and technology to shipping costs. 

Serviceability: Every logistics company has a different level of serviceability, which involves meeting diverse logistical needs across numerous regions. If your business has begun incorporating international shipping into its operations, you must look for a logistics company that can scale to meet your needs. 

When searching for the proper logistics company to hire, consider the end-to-end management systems it uses. Find out if they have 3PL partnerships that can keep your goods moving efficiently. Identify your company’s needs and the region it currently caters to

Warehouse Solutions: The best logistics companies offer storage facilities, inventory management, and tracking, which are essential to satisfying customers. Warehousing services are necessary to ensure your goods are correctly stored until they’re shipped to consumers. The logistics company you hire for this task should use automated tools and software to manage inventory more effectively. 

Inventory tracking and allocation require precise data processing and ample human resources if you want everything to go smoothly. Reputable and experienced logistics companies use the latest technology to optimize shipping operations. Let’s say that your product inventory is highly varied and includes items that must be stored at specific temperatures. In this scenario, look for a logistics company that offers temperature-controlled facilities

Transport and Technology: The suitable transportation systems and technological capabilities can accommodate optimal order fulfillment. You must use modern technology to ship and deliver a high volume of orders effectively. The logistics company you partner with should have trained professionals to use this technology. Look for companies that offer fleets of transport vehicles as well. Transport systems can be equipped with temperature-controlling capabilities if you need to ship perishable or pharmaceutical goods. 

distribution center

Shipping Costs: Working with a logistics company should help reduce shipping costs. To that end, consider pricing structures and negotiation opportunities when searching for the right logistics company. Ask if the company can tailor their pricing structure to suit your needs. The most reputable companies will offer numerous payment plans based on the size, frequency, and type of goods that must be transported. 

Order Tracking: Real-time tracking capabilities are essential to maintain high customer satisfaction. Modern consumers want to be able to check the status of their packages while they’re being shipped and delivered. If a package isn’t delivered within the estimated timeline, the customer can show their tracking number to one of your customer service representatives, allowing for a fast resolution. Order tracking simplifies operations and should be offered by the logistics company you partner with.

Reverse Logistics: Experienced logistics companies will also have strong return policies that can bolster customer loyalty. Customers should be able to exchange or return products efficiently. If a return management system exists, processing returns should be relatively easy. The products that are returned to your company can be resold or refunded. By allowing returns, your company will likely have high customer retention rates

Quality Check and Security: Quality assurance measures and security protocols should be prioritized at every stage of the supply chain. These efforts can help you protect your company’s reputation and the integrity of your operations. Ensure the logistics company you partner with focuses on security and quality assurance.

International Shipping: Before hiring a logistics company, verify their experience level and any licensing they have for international shipping. Only some logistics companies can handle international shipping. To send your items overseas, you must fill out additional paperwork and make extra tax payments, which is why you should work with a logistics company that offers these services and has ample experience.

Conclusion

Logistics companies play an essential role in the modern supply chain. They can make meeting delivery times easier, reducing shipping costs, and managing risk. The right logistics company can free up resources and help you keep customers satisfied. If you anticipate your business will soon grow and scale its operations, consider partnering with logistics companies to optimize your supply chain management processes.

Connectors

QMH is committed to providing end-to-end solutions for companies
with distribution, logistic and warehousing needs.

What material handling solution can we help you create?

Contact Us (855) SEL-RAMP

About Us

With over 32 years of experience in material handling, QMH is committed to providing end-to-end solutions for companies with distribution, logistic and warehousing needs. From permit approval management to full-service execution from the ground up, QMH delivers unique solutions providing distinct value in record time.