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In Response to the US-China Trade War, Retailers Are Relying More on 3PLs

Navigating an ever-changing political landscape can prove challenging for even the most seasoned manufacturers and retailers. Here’s how working with a third-party logistics partner can help.

Though overshadowed in many ways by the impact of the COVID-19 pandemic, the trade war between the US and China continues to wage on. A preliminary agreement was put in place in January 2020, but tensions between the two nations remain. While some prior tariffs have been removed, others have stayed in effect. In an uncertain economy, U.S. manufacturers and consumers are left wondering, what’s next?

For many businesses, the most cost-effective option is to turn to new suppliers and production factories outside of China. Malaysia and Vietnam, in particular, have seen an influx of U.S. companies hoping to avoid tariffs and remain profitable. But this approach poses its own set of challenges.

Manufacturers are now faced with navigating new countries’ rules and regulations, locating new warehouses, and identifying trusted distributors that can get their products from “A” to “B” efficiently. With the added restrictions due to COVID-19, this becomes even more challenging. It’s a complicated web of relationship building, negotiating, and contract signing that quickly becomes overwhelming for even the most seasoned supply chain managers.

This is where third party logistics (3PL) partners come into play. A Lead Logistics  Provider serves as a go-to source of supply chain support for manufacturers and retailers across industries. Leveraging decades-worth of experience and comprehensive global partnerships, these experts have what it takes to optimize operations amidst an ever-evolving trade network.

Putting 3PL Warehouse Management Systems Into Play

New territory means new warehouse management solutions. With a trusted 3PL by their side, retailers don’t have to worry about researching and sorting through the stack of available options. 3PLs have established locations and contacts across the globe, including in countries like Malaysia and Vietnam.

Many 3PLs utilize robust warehouse management systems (WMS) to help their clients handle the transition away from China. These solutions provide real-time visibility into warehouse workers and inventory — no more wondering what’s happening at sites miles away from company headquarters. This allows 3PLs to increase inventory turnaround and provide detailed worker accountability. Productivity is heightened as a result, and supply chain managers are armed with the insights they need to feel confident in new processes and procedures. 

What’s more, 3PL warehouse management systems leverage detailed analytics and algorithms that optimize warehouse activities. This allows manufacturers to boost on-time shipments through accurate order picking, thus minimizing bottlenecks and backorders. Plus, 3PLs are best positioned to manage COVID-related shutdowns or delays in the supply chain.

The Power of Best-In-Class Transportation Solutions

With new processes come new questions surrounding product distribution and increasingly complex supply chains. How can I ensure my products arrive on time? How do I know if they are stored safely during transportation?

Fortunately, 3PL providers have feet on the ground across the globe and can get products from the warehouse to the store shelves without batting an eye. With the help of comprehensive transportation management software, 3PLs can optimize delivery routes and automate load planning to consolidate shipments whenever possible. Costs are reduced thanks to the need for less manpower and fewer trucks.

3PL partners are also equipped to navigate compliance with a region’s transportation authorities and regulatory bodies, taking yet another to-do off of the plates of manufacturers and retailers. Plus, thanks to intuitive inventory tracking systems, all items are traced, tracked, and accompanied by a proof of delivery notification. Manufacturers and retailers can even leverage web-based portals to review the status of a shipment at any given time, providing a highly desired sense of control over the entire operation.

Taking Supply Chain Management to the Next Level

As the US-China trade war persists — intensified by the global repercussions of the COVID-19 pandemic — manufacturers must find innovative ways to evolve and adapt. But, thanks to 3PLs, you don’t have to navigate this situation alone.

The number of qualified 3PL partners is on the rise. According to recent research, the global 3PL market is estimated to reach 1.3 trillion by 2024 [1]. That means more partners doing more work for companies across continents. With the support of 3PL management providers and best-in-class technology, businesses can rest assured that they’re in good hands with an agile and optimized supply chain.



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