Swizstick and I constantly debate which is better; a do-it-all logistics behemoth or a small versatile third party logistics company. I argue for the behemoth mainly because my background is with large global third party logistics companies. Swizstick would argue that the smaller logistics provider can adapt more easily to a customer’s needs and is not weighed down by corporate bureaucracy. The debate will probably continue because there are definitely pros and cons to both sides of the story, although the information that follows could put a serious dent into my argument.

In this world of acquisitions with the big getting bigger one of the main reasons behind these acquisitions is the notion that the majority of large multi-national companies want a “one-stop shop” logistics company to handle all of their logistics needs. Well according to a published report by Unisys entitled, “One-Stop Shopping Concept in Shipping Industry Not Necessarily Popular”, the desire of companies to put all of their logistics requirements in one basket might not be prevalent. In the report, Unisys found that a whopping 70% of companies surveyed advised that they would not move to a “one-stop shop”.

Rather, many respondents indicated that they had an intentional, specific logistics strategy to diversify their business among multiple providers so as to encourage competition and lower prices. They felt that multiple suppliers keep prices and services competitive, and that often niche logistics providers deliver a better service, communicate faster, and are more flexible.

To make matters worse for my case that bigger is better, the report also found that:

Respondents overall felt that the bigger a logistics provider was, the less flexible and user-friendly its systems were. Survey participants were generally satisfied with the real-time information received from integrators and perceived them to have an IT advantage with one company managing the information chain.

What has been your experience? Do you prefer to work with a top five global 3PL or do you prefer to use a blend of niche market players and small to mid-size companies?

Stumble it!