GENCO Demystifies 3PL Marketplace

Editor's Note: Since FedEx announced the acquisition of GENCO late last year, many supply chain managers may still be seeking answers on the cultural shift and its impact on the 3PL marketplace.

In an exclusive interview with SCMR, Andy Smith, GENCO's Vice President of Consumer & Industrial Logistics, shares some insights.

SCMR: What is the greatest mistake shippers make when evaluating a 3PL partner?

Smith: You must consider the 3PL's ability to provide accurate profile data to ensure a precise business model is built that positively impacts business operations. The solution to this problem is to generate better, and more detailed analytics so that project management transition tools can be leveraged to ensure customer risk is limited during integration.

SCMR: When is it best for a shipper to rely on a single 3PL and when is it best to use multiple 3PLs?

The complexity of the existing supply chain dictates the direction of a single-sourced or multiple supplier networks. For example, when reviewing the complexity around regional and international supply chain requirements you must consider the following to determine your approach:

• The number of product channels that must be supported
• The industry (whether it is B2B or B2C)
• The number of distribution centers that will be utilized (whether it is a single or separate DCs) You must determine your 3PLs ability to blend these elements, as well as validating each 3PL’s capabilities across these areas, to determine whether single source or multiple providers is the best fit for you.

SCMR: Can you describe the major trends now shaping the 3PL marketplace?

Smith: From our vantage point, we are still focused on the management of big data to gain competitive advantages, ability to proactively manage labor through workforce optimization strategies, implementation of lean processes and driving innovative value through automation. All of this ultimately works to engage our workforce in order to maximize financial performance while achieving (desired) service levels.

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