When it comes to how a shipper defines the value of a logistics provider or 3PL to the bottom line, there are often several Key Performance Indicators (KPIs) and Logistics Metrics taken into consideration. Every company knows customer service is important; but it is seldom well-defined, and even more rarely measured in logistics operations.
Hiring a Logistics Provider is NOT Transactional, but Relational
Unfortunately, there has been such turmoil in the world of freight brokering and third party logistics, that as of October this year freight brokers and transportation intermediates will have to have at minimum a $75,000 freight broker surety bond in place. This was established to help weed out those who look at providing logistics services as merely transactional and not one of sustainability or continuous improvement over the long haul. If your logistics provider has not dedicated a customer service representative to your account or a go to department when any issues arise, how are you confident they are putting your best interests at heart?
Customer Service is Now the Standard, Not the Exception
Many logistics providers cite standard KPIs such as on-time delivery and order fill rate as proof of their customer service prowess. Others, however, insist customer service falls into its own category, and deserves its own standards of measurement.
Service providers stand out by adding value, and customer service is a substantial part of the equation. Its growing importance means customer service must be made more measurable—as the adage goes, you can’t manage what you can’t measure.
Your logistics provider should provide the following:
Tracking Customer Service Logistics Metrics
So, as a shipper, what should you consider when scoring your 3PL or Logistics Provider? Here are some considerations to add to your KPI scorecard:
It’s all well and good for a 3PL or logistics provider to address customer service and other requirements at the outset of a relationship but shippers should judge 3PLs on their ability to monitor the business and offer ideas to optimize the network as the business changes. This will allow you as a shipper to better control your freight spend to the best of your ability and be a leader in the industry.
In today’s freight logistics environment, technology is a must, but it’s customer service which separates, as they say, “The men (and women) from the boys (and girls).”
How are you scoring the customer service of your current logistics provider? Let us know in the comments below or on Twitter or Facebook!
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