Here is a basic outline for negotiating/evaluating 3PL contracts. It should be noted that this outline is a starting point and tactical in nature. It does not address higher level 3PL performance such as full integration with client business strategies and C level involvement.

• Overview– 3PL should use knowledge and buying power to get best price/terms for services needed
• Analyze–  Existing agreements, pricing, invoicing practices, benchmark
• Plan/Organize– RFP development and/or improvement, vendor and carrier evaluations, negotiation strategy, what if scenarios
• Execute– Implement cost savings plan, re-negotiate existing contracts, develop problem solving protocols
• Control– Ongoing audit and reporting, regular status reports, quarterly review with vendors and carriers to hold accountable for contract terms

 

Common shipper client complaints:

– Not getting 3PL A team

– Surprise costs

– Lack of ideas and innovation from 3PL

– Lagging in technology

 

While 3PL’s want to be more strategic they are often seen by clients as tactical operators and cost reducers.