How to Choose the Right Logistics Service Provider
Read Time: 3-minutes
Today, we’re going to learn about how to pick the right logistics service provider (LSP). To put it incredibly simply, I’m talking about a company that helps other businesses move their products from one place to another.
It’s an important thing to get right in the chemical industry, as It impacts how reliably and safely products reach their destination.
If we think about it from a supplier point of view as well, the LSP has our reputation in the palm of their hands. If they give a poor service, we give a poor service, it’s as simple as that.
A lot of times, companies don’t pick the right partner as they’re not too sure what they’re looking for. Or they don’t prioritise it as it’s “not important”. Obviously, this can lead to some issues down the line…
So let’s be a little more deliberate with our decision making by focusing on the following:
Reliability and Trust
Cost-effectiveness
Services
Reviews, and Recommendations
"Reliability is the precondition for trust." - Wolfgang Schäuble
Reliability and Trust
Reliability, for me, should be top of your list. A reliable LSP ensures you get your products where they need to be, when they need to be there. It’s crucial for maintaining a good relationship with customers. Most have metrics for this – what are they?
Trust is also key, you have to have confidence that your LSP can handle any issues which arise in transit, with honesty and professionalism. Do they have example scenarios? Do they have an SOP for handling delays, damaged goods, or other common problems?
Cost-effective Services
Ahh, cost, again!
As always – it’s a balancing act, the old iron triangle. Don’t expect great quality and speed, and a super cheap cost, but don’t price yourself out of the market either.
This is where clear lines of communication need to be introduced. What do you expect, vs what can be delivered consistently.
What assurances can you get and subsequently give, in-turn.
Understanding the Services You Need
Different LSPs specialise in specific (or a combination of) services, such as fast delivery, hazardous goods, refer shipments, liquids, domestic vs international, and so on.
Make sure you are partnering with an LSP suitable for your specific needs. It doesn’t have to be a one and done approach, you can use different hauliers for different projects.
The Benefit of Reviews, and Recommendations
Both can be invaluable help when narrowing down your search.
They can provide insights into the experiences of other businesses and highlighting the strengths, and potential weaknesses, of an LSP.
Look for reviews on independent sites and ask for recommendations from business contact’s in similar industries. Make sure you pay attention to what is important to you.
I’d take online reviews with a pinch of salt though. Often people only actively go online to complain about a company, less often to promote them. Testimonials are always a better option…
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So, very briefly, there you have it. Choosing the right LSP is an important decision, but it doesn’t have to be a difficult one. Focusing on what YOU need, focusing on the strengths of a particular LSP and backing that up with testimony and reviews, you should be able to find the right partner for your business.
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Thanks for reading, and see you next week.
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