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Logistics Outsourcing Is for Smaller Companies, Too

Lise Bourjot, senior implementations manager of Celestica, explains why smaller companies can benefit from the use of an outsourced logistics provider -- all the while ensuring continued operational effectiveness.

Logistics Outsourcing Is for Smaller Companies, Too

Supply chains are growing increasingly complex, says Bourjot, and companies are finding themselves under more and more pressure to drive down logistics costs. The tasks of carrier selection, contract and operations management, and freight audit and payment can be a drain on internal resources.

"For small to mid-sized companies," Bourjot says, "this probably isn't even [among] their top items of what they need to work on." So outsourcing of those functions begins to make sense.

Working with an outside provider can help to streamline processes and hold down overhead. Electronics manufacturing in particular is a narrow-margin business, unable to take on costs that aren't strictly necessary to running the operation.

Small or mid-sized companies looking to outsource supply-chain functions should seek out a provider that can combine their business with a larger pool of spend, Bourjot says. In the event, they get access to rates that they could never have negotiated on their own.

Technology is another element to be considered. Many providers of outsourced services include a transportation-management system as part of their offering. Customers can tap into the application without incurring capital costs for system development and acquisition.

Finally, there's the relationship question. "You want to look for a partner who is going to work to understand your logistics needs," says Bourjot. The provider should be able to maintain a steady, consistent environment throughout changing processes and organizational upheaval. "Your network is always going to evolve," she says.

Bourjot further advises that companies looking for outsourcing partners establish a baseline of services at the outset, with defined freight savings. "When you go live," she says, "you have a clear expectation that's immediately measurable."

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