The Evolution of the 3PL Industry: You’ve Come a Long Way, Baby

Category: 3PL December 3, 2015

The logistics industry may have a robust and lengthy history, but the third party logistics (3PL) sector is less than 40 years old. Even on that shorter timeline, the evolution of the 3PL industry has grown over the years to meet better customers’ changing and complex demands. Today, these multifaceted, agile organizations provide a solid backbone for shippers of all sizes and across all industries.

The trend of outsourcing logistics services to third parties gained momentum in the 1980s. Some attribute this shift to the Motor Carrier Act of 1980, which deregulated the trucking industry and allowed warehousing companies to more easily move into freight management. When information technology (IT) emerged in trucking and warehousing between the ‘80s and ‘90s, the streamlining of logistics processes, communications, and supply chains became even more prevalent.

Global logistics gained popularity in the 1990s as companies expanded their product reach into quickly emerging global markets. As these new global trade zones presented new challenges for companies that were used to the domestic market, 3PLs stepped up to the plate to help. Supply chains continued to increase in complexity, which heightened the need for more efficient transportation management. Both domestically and internationally, 3PL providers offered more integrated logistics services to help shippers address those complexities.

As the 3PL industry continued to evolve, certain providers opted for specializations like cold storage and refrigerated transportation. Using their own temperature-controlled facilities, vehicles, and unique capabilities (i.e. SKU mixing and special pallet configurations), providers helped food manufacturers save money on fuel, labor, equipment, and overhead—all while reducing those customers’ carbon footprints.

In the early 2000s, rapid technological advancements—including the expansion of the Internet—compelled 3PLs to begin providing “connected” supply chain solutions. Using technology platforms to better integrate inventory management, transportation and logistics processes, and order management, 3PLs extended their technology infrastructures to their own customers. In turn, those customers could avoid having to make big investments in technology infrastructure, software, and IT personnel. It was a win-win for everyone involved.

The 3PL market is still in expansion mode. As of 2014, the 3PL market in the U.S. alone was worth more than $157 billion and growing at a rate of 7.4 percent. Using advanced technology (including logistics software), 3PLs like Hanson Logistics are providing supply chain solutions to an expanding array of companies. Customers gain greater visibility and control over their supply chains and reap significant cost reductions along with the ability to focus on their own core competencies.

We’ve enjoyed being your best frozen food 3PL partner over the last 11 years, and we look forward to watching the industry evolve for years to come.

Green Supply Chain Management and the 3PL

Category: 3PL,Supply Chain January 14, 2016

Ever since the first third party logistics (3PL) firm opened its doors 40 years ago, 3PLs and cold storage providers like Hanson Logistics have evolved and transformed to meet their customers’ needs. With more businesses paying close attention to the environmental impact of their supply chains—and finding ways to offset the carbon footprint associated with Read the full article…

The New South Haven Logistics Center: Keeping Southwest Michigan Fresh

Category: Cold Chain,Frozen Warehousing,Refrigerated Transportation,Supply Chain January 28, 2016

Americans consume nearly 225 lbs. of fruit per person every year, much of which has been stored and distributed through the cold chain. Logistics plays an important role keeping these products as fresh as possible. The Michigan agricultural industry contributes $101.2 billion each year to the state’s economy. As the number one producer of blueberries Read the full article…