As manufacturers and retailers seek ways to reduce non-value added costs in their supply chains, outsourcing of distribution, transportation, and warehouse handling functions can be a viable alternative.
While manufacturers are increasingly focused on innovation, e-commerce, and other product / conversion core competencies retailers are focused on improved merchandising, shopper marketing, and store operations.
Transferring distribution and warehousing responsibilities to third party logistics professionals, and/ or shifting to a more efficient internal network, can reduce these costs by as much as 10-20% of total spend.
What We Do
TPG’s Logistics Services Team analyzes 3PL provider costs and capabilities and quantifies the opportunity. A partial list of our consulting services include:
- Current State Spend Analysis: Analyze the current state of distribution operations to determine inbound/outbound transportation costs, warehouse in/out and storage charges, and indirect labor, management, and administration costs.
- Benchmark Comparison: Based on geography and 3PL locations, TPG compares the current spend rates to benchmark rates based on other internally operated distribution locations and/or 3PLs managing similar product categories.
- RFP development and Evaluation: TPG assists or leads the development of a detailed Request For Proposal (RFP) with the client to identify several provider options. TPG assists the client in evaluating provider responses.
- 3PL Option Analysis and Selection: TPG and the client review the provider responses and select the “Best Case Option” based on financial, strategic and operational criteria.
- Project Milestone Development: A detailed milestone schedule is developed to move to an alternative distribution network whether internally operated or via a 3PL. Potential issues with other client priorities are identified and addressed to ensure a smooth project implementation.