Managing and optimizing the supply chain is crucial to the success of any business. While many organizations operate multiple components of the supply chain in-house, including manufacturing and fulfillment, with growing demand and continuing disruptions, many companies are considering supply chain outsourcing to keep operations moving efficiently.
What is Supply Chain Outsourcing?
Supply chain outsourcing involves the hiring of third parties to assist with the management of a supply chain. This can help companies manage inventory tracking, order management, order fulfillment, and even product manufacturing. A business that decides to utilize supply chain outsourcing may realize many benefits:
- Reduced overall costs: The costs of managing a supply chain internally can add up quickly. Outsourcing allows a company access to the scaled resources, staffing, equipment, and knowledge of their third-party partner, giving them the right tools to streamline and cut costs.
- Increased customer fulfillment: An outsourced supply chain management partner can assist with order fulfillment from the time the customer places the order to when it is out for delivery. They can also take responsibility for the direct management of customer issues.
- Enhanced resources: Bringing on a third-party partner gives a company access to resources, expertise, and knowledge they did not have before, allowing them to grow and learn to the benefit of their business.
- Improved adaptability: As we have seen in the last few years, the ability to adapt to changing environments quickly is crucial for the success of the supply chain. Outsourcing brings another set of skills, resources, and experience to the table when having to adjust to meet consumer demand.
Manufacturers and logistics companies know that effective supply chain management is crucial to success. And because of the challenges they have faced as a result of the COVID-19 pandemic, many have been focusing more on investing in supply chain innovations to adapt. While helpful and effective, innovations such as warehouse management systems, artificial intelligence, and supply chain automation can be a lot for a company to manage. Supply chain outsourcing can bring in a partner to manage all these systems and make certain that the supply chain is running smoothly. Contract manufacturers can take the entire manufacturing process over for their customers, which can help smaller firms reduce this significant overhead expense.
Another way to outsource may include partnering with a plastic pallet pooler to manage the shipping pallet fleet. Providers like iGPS Logistics, free companies from having to manage their own pallet supply and reduce the costs and complexity of pallet procurement, storage, transport, and recovery. An efficient pallet pooling company will ensure that its clients have a ready supply of pallets as needed, reducing waste and energy use throughout a supply chain.
iGPS plastic pallets also incorporate smart features that make them traceable throughout a supply chain. These features allow companies to capture data at any point of distribution, ensuring better planning and efficiency, and helping to lower a company’s Total Cost of Business (TCOB). Additionally, iGPS plastic pallets generally last four times longer than wood pallets and are 100% recyclable. At the end of their useful lifespans, they are broken down and remolded into new pallets again.
As businesses continue to navigate supply chain disruptions, it is important to remember that they do not have to face all challenges on their own. Supply chain outsourcing can bring in fresh ideas and expertise — and badly needed staff, resources, and infrastructure — to help enterprises retain their long-term competitiveness.
Companies committed to cost-effective supply chain outsourcing use iGPS plastic pallets for all their shipping needs. Our lightweight, recyclable plastic pallets can help reduce harmful emissions and lower your Total Cost of Business. For more information, contact us at 1-866-557-0047, email a specialist at [email protected], or visit our contact page.