NEW YORK — A new third-party logistics (3PL) study from NTT Data, Penn State and Penske shows that 78% of shippers were satisfied with their 3PL providers’ information technology (IT) capabilities, a 3% drop from 2023.
Shippers’ outsourcing of logistics services saw a similar dip. Last year 89% of shippers were using outsourced logistics services. This year it’s 87%.
“It’s a small decrease, but compared to 2021’s 94%, it’s a significant drop over the course of three years,” the study, titled “The Power of Partnerships: Exploring Collaboration Through Data and Innovation,” notes.
The study focuses primarily on the role of partnerships in the shipper and 3PL industry.
It homes in on three key areas: the power partnerships provide, the flow of data and looking beyond the hype of technology — something we’ve all fallen prey to as the latest and greatest tech has come out.
“In a small victory for some 3PLs and a loss for others, 85% of shippers are reducing or consolidating 3PLs, almost a 10% increase year over year,” according to the news release. “As for what services shippers are starting to outsource, that’s the ultimate value-add for 3PLs to tack on to existing business and highlight for prospective clients.”
The study notes that the most outsourced things are day-to-day tasks, with about 50% of reported outsourced services being domestic transportation, freight forwarding, warehousing, customs brokerage, international transportation, and transportation planning and management.
“On the warehousing front, this year 65% of shippers are reported to be outsourcing the work, compared with 43% from the 2022 study,” the news release states.
The all-important IT solution that 3PLs provide to shippers took one of the biggest hits this year.
“Nearly all shippers, 97%, said IT capabilities are a necessary element of overall 3PL provider expertise. In the current study, 49% of shippers indicated they’re satisfied with 3PLs’ IT capabilities, down from 54% last year and 58% in 2022,” the news release states. “Interestingly, shippers identified more IT capabilities than they have in the past.”
The study states that the downward trend of shippers being satisfied with their 3PLs’ IT capabilities isn’t ideal and shows that now, more than ever, there needs to be a push to maintain and improve the technological aspects of the business.
“The must-have pieces of technology that shippers are looking for from 3PLs are more transaction-based, such as transportation management planning,” according to the study. “A total of 62% of shippers consider this vital. Rounding out the top four are warehouse/distribution center management (59%), transportation management scheduling (57%) and advanced analytics and data mining tools (50%).”
As for what these findings mean for the dynamics of the relationships between 3PLs and shippers, well that has also changed.
According to the study, “This year’s research supports the concept that the power dynamic has had impacts on both shippers and 3PLs. In the past, shippers had more leverage. Among respondents: 39% of shippers and 38% of 3PLs said shippers have gained leverage over the past three years; 30% of shippers and 31% of 3PLs said 3PLs/4PLs have gained leverage; and 31% of both shippers and 3PLs said there’s been no change.”
To check out the full 75-page study, visit the 3PL study website.
Born in Pine Bluff, Arkansas, and raised in East Texas, John Worthen returned to his home state to attend college in 1998 and decided to make his life in The Natural State. Worthen is a 20-year veteran of the journalism industry and has covered just about every topic there is. He has a passion for writing and telling stories. He has worked as a beat reporter and bureau chief for a statewide newspaper and as managing editor of a regional newspaper in Arkansas. Additionally, Worthen has been a prolific freelance journalist for two decades, and has been published in several travel magazines and on travel websites.
