Coyote Logistics has released its latest shipper and carrier study, designed to help businesses decide whether they should outsource logistics to 3PLs or or build the function in-house.
Coyote is a leading global third-party logistics provider that matches more than 10,000 shipments every day. It is owned by UPS.
In its report, Coyote says choosing the right strategy “will help you out-ship your competition, while the wrong one will lead to lost customers and a bloated budget”.
The study – called Supply Chain Outsourcing for the Win – offers data-backed insight from 500 shippers, with Coyote explaining that “If you’re looking for a little guidance as you seek the right blend of in-house capabilities and outsourced providers in your supply chain, start by using your peers”.
The result show that companies are now treating supply chain with the same deference as finance and sales, with many (29%) giving supply chain its own seat in the boardroom, a figure that jumps to 36% for firms with over $800mn in annual revenue.
“Driven by the era of fast-and-free delivery, and supercharged by a global pandemic, executives have had to become increasingly logistics-savvy,” says Coyote. “They’ve also had to back it up with more resources.”
Respondents agreed (79%) that their corporate leadership has both a good understanding of how their supply chain works, and is investing in improving supply chain capabilities.
The paper also shows that one of the ways companies are investing in logistics is through growing their internal expertise.
Nearly half of firms growing supply chain headcount
Over the past two years, 43% of shippers grew their supply chain team’s headcount, compared to only 16% who cut it.
And despite a shaky economic outlook, Coyote says that trend looks to continue, with 47% of shippers planning to grow supply chain headcount again this year, compared to only 8% who are downsizing.
Coyote also revealed that in the midst of market volatility, shippers turned to their 3PLs for help.
The findings show over the past two years, 50% of shippers increased their spend with outsourced providers, compared to only 12% that decreased spend.
Not only did shippers spend more overall, but they did so with more 3PLs – 43% of shippers expanded their provider base, compared to only 13% who decreased.
And while freight markets are in a very different place now, shippers are doubling down on their commitment to outsourcing.
Over half of respondents plan on increasing their spend with 3PLs again this year – a 2% jump compared to the last two years.
A majority also plan on increasing the number of 3PLs in their network, up 7% compared to the last two years.
“It seems ready access to scalability, capacity and expertise is proving a reliable way to stabilise operations,” concluded the study.