Plastics Logistics : 3Party Logistics (3PL) Partnerships in the Plastic Industry

A Third-Party Logistics (3PL) partnership in the plastic industry is a business relationship where a plastic manufacturer or distributor outsources logistics operations to a specialized external company that manages transportation, warehousing, distribution, and sometimes additional supply chain functions. 

These partnerships allow plastic companies to leverage specialized expertise, technology, and infrastructure without having to develop these capabilities internally.

Core functions of 3PL partnerships:

Transportation management:

Coordinating the movement of plastic materials and products via various transportation modes.

Examples:

• C.H. Robinson: managing full truckload shipments of plastic resin from Gulf Coast producers to Midwest manufacturing plants
• Schneider National: operating dedicated fleets for just-in-time delivery of automotive plastic components
• DSV Panalpina: arranging international shipments of specialized engineering plastics from Asia to European markets

Warehousing and distribution:

Storing and handling plastic materials and products in strategically located facilities. 

Examples:

• DHL Supply Chain: operating regional distribution centers for plastic packaging products, managing inventory and fulfilling customer orders
• Ryder Integrated Logistics: providing specialized warehousing for temperature-sensitive plastic medical devices
• GEODIS: managing consolidated distribution of plastic consumer goods from multiple manufacturers to retail customers

Value-added services:

Additional specialized services beyond basic transportation and storage.

Examples:

• Kenco Group: 0perating packaging operations where bulk plastic parts are repackaged into retail-ready containers
• XPO Logistics: providing light assembly of plastic components before final delivery
• Rhenus Logistics: managing quality inspection and testing of imported plastic products

Types of 3PL providers in the plastic industry:

Asset-based 3PLs:

Logistics providers that own their transportation equipment and warehouse facilities. 

Examples:

• J.B. Hunt: using company-owned trucks to transport plastic packaging materials
• Penske Logistics: operating dedicated warehouses for major plastic product manufacturers
• NFI Industries: providing specialized railcar and bulk truck transportation for plastic resin

Non-asset-based 3PLs:

Logistics providers that coordinate services using subcontracted carriers and facilities. 

Examples:

• Echo Global Logistics: arranging transportation of plastic products through a network of contracted carriers
• Coyote Logistics: providing on-demand transportation solutions for plastic product shipments
• BlueGrace Logistics: managing freight for seasonal plastic product promotions

Industry-specialized 3PLs:

Logistics providers with specific expertise in handling plastic materials and products. 

Examples:

• Bulk Transport Company: specializing in pneumatic bulk transportation of plastic resins
• Quality Distribution: focused on liquid plastic additives and chemical transportation
• Plastic Express: dedicated to plastic resin distribution with specialized equipment and facilities

Benefits of 3PL partnerships for plastic companies:

Cost optimization:

Reducing overall logistics expenses through economies of scale and expertise.

Examples:

• Consolidated shipping: A packaging manufacturer using C.H. Robinson to combine shipments with other companies, reducing costs by 15%
• Network optimization: CEVA Logistics redesigning a plastic toy manufacturer's distribution network, saving $2 million annually
• Flexible capacity:  seasonal plastic product maker using XPO on-demand warehousing, avoiding fixed costs during low seasons

Expertise access:

Leveraging specialized knowledge and capabilities without internal investment.

Examples:

• Regulatory compliance: a chemical company using Odyssey Logistics to manage hazardous material documentation for plastic additives
• International trade: a medical device manufacturer relying on Kuehne+Nagel's customs expertise for global distribution
• Technology systems: a plastic container company accessing advanced tracking systems through partnership with Transplace

Scalability:

Quickly adjusting logistics capacity to match business fluctuations.

Examples:

• Seasonal scaling: pool toy manufacturer using GEODIS to triple warehouse space during peak season
• Geographic expansion: plastic bottle producer entering new markets through DHL established distribution network
• Rapid growth: startup biodegradable plastic company leveraging FedEx Supply Chain to scale operations without capital investment

Focus on Core Business:

Allowing plastic companies to concentrate resources on manufacturing and innovation. 

Examples:

• R&D redirection:  polymer developer redirecting 5 staff positions from logistics to research after partnering with Ryder
• Capital reallocation:  plastic recycler investing in new processing equipment instead of delivery trucks after outsourcing to J.B. Hunt
• Management attention: an injection molder's executives focusing on new product development after UPS Supply Chain takes over distribution

Implementation models:

Tactical 3PL relationships:

Outsourcing specific, limited logistics functions on a transactional basis.

Examples:

• Spot transportation: a plastic pipe manufacturer using DAT Solutions to find carriers for occasional oversized shipments
• Seasonal warehousing: a holiday decoration maker using extra Ryder warehouse space during peak season
• Overflow handling: a plastic container producer using XPO to handle orders exceeding internal capacity

Strategic 3PL partnerships:

Deep, collaborative relationships covering multiple logistics functions with shared objectives.

Examples:

• Embedded operations: DHL staff working on-site at a major plastic packaging company, fully integrated with production planning
• Joint innovation: a plastic automotive part supplier and Penske jointly developing specialized handling equipment
• Risk/reward sharing: CEVA Logistics contract with performance bonuses tied to a plastic product manufacturer's success metrics

4PL/Lead llogistics provider approach:

A provider that manages a plastic company's entire logistics network, including other 3PLs. 

Examples:

• Holistic management: Accenture managing all logistics providers for a global plastic packaging corporation
• Technology integration: Blue Yonder coordinating systems across multiple 3PLs for a diversified plastic products company
• Strategic oversight: LeanCor providing complete supply chain management for a plastic medical device manufacturer

Technology integration in 3PL partnerships:

Visibility systems:

Technologies that provide real-time information about inventory and shipments. 

Examples:

• Shipment tracking: FourKites platform showing plastic resin railcar locations during transit
• Inventory visibility: C.H. Robinson Navisphere giving plastic product manufacturers real-time stock levels across multiple warehouses
• Performance dashboards: transplace providing online KPI reporting for a plastic packaging distributor

Warehouse Management Systems (WMS):

Software that optimizes storage, picking, and inventory control in warehouses.

Examples:

• Manhattan Associates WMS: deployed by DHL to manage a plastic toy manufacturer's distribution center
• HighJump WMS: used by GEODIS for efficient handling of various plastic product types in shared facilities
• JDA WMS: implemented by Ryder for a plastic container company with complex inventory requirements

Transportation Management Systems (TMS):

Software that optimizes carrier selection, routing, and freight management.

Examples:

• MercuryGate TMS: Used by Echo Global to optimize plastic resin transportation costs
• Oracle Transportation Management: Deployed by CEVA for a major plastic packaging company's complex distribution network
• BluJay TMS: Implemented by CH Robinson to coordinate international plastic product shipments

Challenges and solutions in 3PL partnerships:

Integration challenges:

Difficulties in connecting systems and processes between the plastic company and 3PL.

Examples:

• Data synchronization:  plastic pipe manufacturer using Liaison Technologies EDI solution to connect with Ryder's systems
• Process alignment:  plastic packaging company and XPO creating joint standard operating procedures
• Cultural differences:  family-owned plastic products business using change management consultants to facilitate DHL partnership

Performance management:

Ensuring 3PL services meet the plastic company's requirements consistently.

Examples:

• KPI dashboards: plastic automotive parts supplier receiving weekly scorecards from Penske
• Regular reviews: quarterly business reviews between a plastic container company and C.H. Robinson
• Continuous improvement: A plastic medical device manufacturer and DSV implementing Six Sigma projects

Specialized plastic industry requirements:

Addressing unique characteristics and needs of plastic materials and products.

Examples:

• Food-grade compliance: Americold maintaining special protocols for food packaging plastic storage
• Static prevention: GEODIS implementing special handling procedures for electronic plastic components
• Resin handling: Bulk Transport Company using specialized pneumatic equipment for plastic pellet transfer

Emerging trends in plastic industry 3PL partnerships:

Sustainability collaboration:

Working together to reduce environmental impact of plastic logistics.

Examples:

• Carbon reporting: DHL providing plastic packaging companies with emissions data for sustainability reporting
• Alternative fuels: J.B. Hunt using natural gas vehicles for a recycled plastic distributor
• Packaging reduction: CHEP developing reusable packaging systems with a plastic product manufacturer

Digital transformation:

Implementing advanced technologies to improve logistics efficiency and capabilities.

Examples:

• Blockchain implementation: Maersk TradeLens tracking recycled plastic content through the supply chain
• IoT sensors: C.H. Robinson deploying temperature and humidity monitors for sensitive plastic medical devices
• Predictive analytics: XPO using AI to forecast optimal inventory levels for seasonal plastic products

Circular economy support:

Developing logistics solutions for plastic recycling and reuse.

Examples:

• Reverse logistics: CHEP managing collection of plastic pallet return programs
• Recycling support: Veolia implementing sorting and consolidation services for post-consumer plastic
• Material tracking: SAP and UPS collaborating on systems to trace recycled plastic through manufacturing cycles