All you Need To Know About Managing Multiple Logistics Service Providers


All you Need To Know About Managing Multiple Logistics Service Providers

According to an online report, more than 95% of Fortune 100 companies and 85% of Fortune 500 companies rely on third-party logistics service providers to manage their business logistics operations. With the right infrastructure and technology in place, LSPs empower businesses to expand serviceability, offer multiple delivery choices to their customers, and increase profitability. However, most businesses partnering with more than carriers or LSPs find it challenging to manage them effortlessly. Here is when an AI-powered multi-carrier management software comes into the picture. Before we dig deeper into how the software helps with multi-carrier management, let’s have a look at the reasons behind multiple-carrier adoption and challenges associated with multiple logistics service providers’ management.

3 Reasons Behind Increasing Multiple Carrier Adoption

To Expand Geographical Serviceability

Businesses are fast realizing the importance of expanding their geographic footprint to increase their customer base. And to do so, they partner with multiple courier providers. Different LSPs have different areas of operations or geographical reach, which help businesses to tap into more customers.

To Introduce New Delivery Options

Same-day delivery, next-day delivery, and slotted deliveries are the new delivery trends that customers expect from a brand. Partnering with only one courier provider might not help a business to achieve this for all its customers. Therefore, most businesses are connecting with different logistics service providers considering their area of serviceability, the type of delivery services they offer, and various other parameters.

To Reduce Logistics Costs

Outsourcing logistics operations to different courier service providers also contributes to minimizing logistics costs. By doing so, a business can choose the most profitable logistics provider for different types of deliveries. Besides, 3PLs use advanced technology solutions to ensure cost-efficient deliveries and minimize the rate of returns.

Challenges Businesses Face While Managing Multiple Logistics Service Providers

One of the biggest challenges with the conventional 3PL management system is manual order allocation. It fails to consider different parameters to find out which order should be assigned to which courier partner. Also, it doesn’t provide means to manage order allocation between self-fleet and 3PL. Performance benchmarking is critical to understanding which 3PL partner is profitable, meeting their promised SLAs, and more. However, with manual management, it is quite challenging for the logistics managers.

Apart from these two, other major challenges businesses face include a lack of status standardization, inability to manage NDRs, and difficulty tracking multiple consignments. All these can be overcome by implementing intelligent multi-carrier solutions.

Advanced Multi-Carrier Management Software to Manage Multiple Logistics Service Providers

AI-powered multi-carrier management software empower e-commerce companies, retailers, and other businesses to seamlessly manage multiple courier partners. Read on to know how:

Automated Order Allocation Engine

Multi-carrier management software leverages advanced machine learning algorithms to automatically adjust order allocation rules considering the past performance of carriers and defined business objectives and then automate the order allocation process. The engine reduces the reliance on human resources and also eliminates the chances of errors in the process. Businesses can define order allocation rules in one line manner. For instance, they can choose to allocate all COD orders to a particular courier partner and non-COD orders to the other.

Real-Time Tracking

Real-time tracking empowers businesses to gain control over the delivery process and ensure that each courier partner meets delivery SLAs. However, tracking multiple consignments or parcels manually is not only time-intensive but also not feasible with manual tracking. 3PL aggregator or courier aggregator solutions allow businesses to track multiple consignments and get dynamic ETAs sent via the same or different logistics service providers from a single dashboard.

Seamless Management of KPIs

To ensure business profitability and customer satisfaction, it is important to regularly monitor the performance and measure the KPIs of all the carriers associated with a business. However, manually managing this task is not possible. Multi-carrier management platforms have business intelligence capabilities to measure critical performance metrics such as the number of successful and failed deliveries, first-attempt delivery success rate, rate of returns, etc.

Status Standardization

To keep end customers informed of the status of their order, every logistics service provider sends them updates/notifications via SMS/WhatsApp/Email. However, not all LSPs use the same format; some may use ‘parcel pick up done’, or ‘consignment picked’ while others may use ‘pickup complete.’ This disrupts the communication that goes to the end customer, thereby impacting the overall customer experience. Multi-carrier management software empowers businesses to standardize these statuses and send one type of notification to all customers for all deliveries.

Arresting Fake Delivery Attempts

Advanced multiple carrier management solutions also have the feature to arrest fake delivery attempts, especially when the system-generated location and the location where the driver has delivered the order doesn’t match. In case of a fake delivery attempt, the multi-carrier management solution instantly sends feedback to the responsible courier partner.

Support for Hyperlocal Carrier Partners

Intelligent multi-carrier management software have dynamic driver-level serviceability checks to connect with hyperlocal delivery service providers that empower businesses to offer instant deliveries, same-day deliveries, next-day deliveries, and slotted deliveries.

NDR Management

Different courier service providers send out their own set of non-delivery reasons, which causes lack of consistency for businesses. MCM solutions overcome this challenge with efficient NDR management, wherein it consolidates 60+ non-delivery reasons drivers can choose to notify businesses. NDR standardization also helps to look into non-deliveries that are often registered at a particular hub or by a particular 3PL, which further assists with increasing the second-attempt delivery rate.

Rate and TAT Master Digitization

Advanced multi-carrier management solutions relieve logistics managers from the hassle of manually managing pincode level items in spreadsheets to check and compare turnaround times, serviceability, and rates of various logistics service providers. It automates the rate and TAT masters shared by third-party logistics providers and reduces the time and effort required to perform the process.

Hassle-Free Onboarding

Multi-carrier management solutions are integrated with more than 120 third-party logistics companies, which makes it easy for e-commerce, retail, and other businesses to onboard new 3PLs as and when required. They can scale their operations in no time just by partnering with a new third-party logistics partner from the MCM platform.

Manage Multiple Logistics Service Providers Efficiently with Shipsy

Shipsy’s multi-carrier management platform empowers e-commerce companies, retailers, and other businesses to partner with more than one 3PL partner to drive logistics excellence and orchestrate last-mile deliveries seamlessly. It offers single-screen shipment tracking to allow tracking of multiple shipments in real-time and digitizes rate and TAT contracts to view and compare 3PL rates and serviceability. The solution also automates the label generation process and generates labels that are accepted across all carriers.

Besides, the solution also leverages business intelligence capabilities to allow businesses to measure the KPIs of 3PLs, identify and eliminate risks in logistics operations, and improve decision-making through actionable insights. Shipsy’s MCM solution can be easily customized and integrated with any existing technology infrastructure. It comes with ready-to-use integrations with 120+ 3PL companies to make the 3PL onboarding process convenient and quick. Here are some of the benefits businesses can unlock with Shispy’s multi-carrier management solution:

  • Up to 18% reduction in RTOs (return to origin)
  • Shrink last mile delivery costs by 14%
  • Minimize middle mile costs by 12%
  • Offer unified customer experiences
  • Enhance customer experience by 28%

To know more about Shipsy’s smart multi-carrier management platform or how it can benefit your business, please get in touch with our experts for a customized demo today!


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