Chemical companies are benefiting from the warehousing, distribution and transportation expertise of third-party logistics partners. The level of usage may vary widely from the outsourcing of just one logistics function to a total end-to-end supply chain management solution and everything in between. Companies in the chemical sector can free up resources and talent to focus on their core competencies in the manufacture, marketing and sales of chemicals, while leveraging the core competencies of their 3PL provider, tapping into third-party logistics and supply chain best practices and state-of-the-art warehouse and transportation management technology.
Research and development is costly. Opening new markets and establishing strong relationships with customers take time and resources. Tying up capital in non-revenue-generating assets like warehouse distribution centers and in-house trucking operations may not make sense when those resources could be better used elsewhere.
While there is no denying the complexity of logistics for the chemical industry, the right 3PL provider with knowledge and experience in your vertical can handle the myriad of issues involving security, safety and regulatory compliance they may encounter managing your warehousing, fulfillment and/or transportation needs.
The benefits of outsourcing some or all of your logistics needs include:
- Greater Scalability to quickly and easily size up or down logistics operations to meet changing market conditions and cyclical nature of the chemical sector. There’s no need to carry on your balance sheet an under-utilized distribution center when sales volume is low. Similarly, there’s no long lead time to open new warehouses when sales volume is peaking and your existing facilities are at capacity.
- Increased Efficiency resulting from the optimum utilization of the human talent, systems, procedures and equipment assembled by your 3PL. This includes the use of advanced IT capabilities such as modern warehouse management systems (WMS), modern transportation management systems (TMS), RF bar code scanning, web portals for enhanced real-time visibility to your inbounds, inventory and outbound shipments, and EDI for seamless data flow within your supply chain and/or distribution channel network.
- Improved Safety and Compliance due to your 3PL being able to dedicate more resources to these areas, particularly compared to many of the small to mid-market companies they serve. Top-flight 3PL providers also invest in ongoing, account-specific training programs which aid in their performance in safety and compliance.
- Better Cost Control from having better faster access to the data you need to plan and make decisions. In addition to improving productivity and efficiency, real-time visibility and interconnectivity allows for better management of the entire supply chain and/or distribution channel network, including freight optimization which can lower costs and improve margins.
Six factors to consider when selecting or evaluating a third-party logistics provider:
- Breadth of experience in the chemical sector
- Percentage of shipments for its customers that are chemicals
- In-house IT capabilities
- Timeline for implementation
- Demonstrated ability to provide customized solutions
- Financial stability/long-term viability
FW Warehousing is headquartered in St. Louis, Missouri with Midwest warehouse distribution centers in Kansas City, Indianapolis and St. Louis totaling more than four million square feet. Founded in 1949 with a focus on food-grade storage, FW later broadened its services to include contract warehousing, dry storage, hazardous material and chemical storage, temperature-controlled storage, product distribution and B2B and B2C fulfillment.
FW Warehousing has more than 50 years of experience in third-party 3PL logistics and has been ranked in the top 100 Third Party Logistic Companies in the country by Inbound Logistics magazine.
For more information about the full range of third-party logistics capabilities, visit the FW Warehousing website.