Extended supply chains are often plagued by fragmentation and a lack of visibility.
Global networks of suppliers and customers require a dedicated workforce to manage, and you need your workforce focused on core operations. Other complicating factors include:
- Part proliferation
- Industry consolidation
- Complex international trade environment
Of course, all these complexities have been overshadowed by the current global health crisis. No solution can make your business completely immune to global events of this scale.
But fourth-party logistics (4PL) can help you respond to disruptions in your supply chain.
4PL providers have a unique set of characteristics that make them particularly well adapted to mitigating the effects of supply chain disruptions on your operations. With an experienced 4PL provider, your business can access tools that help you respond to disruptions.
How 4PL helps mitigate supply chain disruptions
The following features of a global 4PL provider let them help you create a responsive supply chain.
Established supplier base
An experienced 4PL provider will have established relationships with thousands of suppliers across the world. Your supplier base is immediately expanded upon entering into a 4PL agreement.
That means if one supplier suddenly shuts down, products can likely be sourced elsewhere within the existing supplier network. Disruption is avoided and operations can continue as scheduled.
With worldwide facilities, a global 4PL provider minimizes the impact of local disruptions on your supply. These could be anything from natural disasters, to epidemics, to regional politics.
Having offices and stocking facilities around the globe lets your 4PL provider keep materials close to your facilities, even when plans go amiss and delivery or receipt locations are changed.
Elevated visibility and communication
Through constant data-streams and clear communication channels from suppliers to customers, a 4PL provider keeps its finger on the pulse of your supply chain. This is especially important when your business needs to respond to changing market or supply conditions.
The strength of the 4PL model is the increased visibility it creates throughout the extended supply chain. This central oversight makes it easier to spot disruptions before they occur and respond before they stop operations.
Responsive, not reactive
With an experienced 4PL provider, your business can gain access to the characteristics necessary for mitigating supply chain disruptions. With these come flexibility, the ability to adapt quickly to changes, and a deeper understanding of the supply chain.
A 4PL provider cannot make your business immune to major disruptions. But it can be the difference between you being able to respond to crises instead of merely react.
Learn More about Fourth-Party Logistics
Curious to learn more about 4PL? Download our free e-book “Guide to Fourth-Party Logistics” to find out how 4PL works, why it matters, and what to look for in a service provider.