**London**: Easy Metrics launches its Profit Management software to assist third-party logistics companies in overcoming profit hurdles. With 40% struggling with profitability, the tool offers real-time insights to enhance pricing strategies and operational efficiencies, potentially boosting margins significantly in a competitive landscape.
The third-party logistics (3PL) sector, valued at $194 billion in revenue last year, faces a significant profitability challenge, with 40% of 3PL companies experiencing difficulties in boosting profits. This issue highlights an ongoing struggle within the industry to manage supply shortages and fluctuating power dynamics between supply chain partners. Easy Metrics has introduced a new software solution, Easy Metrics Profit Management, aimed at addressing this gap by providing real-time insights into profitability across various metrics, including customer and operational processes.
Dan Keto, President and CTO of Easy Metrics, emphasised the transformational potential of this data, stating, “This real-time profitability data is a game-changer for 3PLs. Knowing each customer’s operating margin enables 3PLs to price competitively, negotiate pricing based on objective data, and boost operating margins by up to 3%.” For many 3PLs, whose operating margins typically range from 20% to 30%, this improvement could represent a substantial financial gain.
The emphasis on enhanced pricing transparency may play a crucial role in shifting supplier-customer relationships. As customers often value service quality over pricing, the ability to share operational data effectively can facilitate more informed pricing discussions and establish stronger trust between 3PLs and their clientele. Val Ramoop, Vice President of Operations at National Logistics Services, which trialled the new software, remarked, “Ultimately, the data speaks for itself. If there are deviations, we can show our clients, ‘This is what’s driving your cost per unit.’”
The solution particularly benefits multi-tenant logistics providers, allowing them to conduct daily profit analyses across entire networks and identify unprofitable activities for targeted improvements. This approach positions 3PLs to better navigate an increasingly competitive landscape. Keto noted, “With significant bottom-line gains through better pricing and the ability to identify and address unprofitable activities, 3PLs using our solution will have a clear edge in today’s ultra-competitive environment.”
Easy Metrics Profit Management integrates seamlessly with existing systems, including Easy Metrics ProTrack™ and various Labour Management Systems (LMS). The company also provides its own OpsFM™ for 3PLs without an LMS, facilitating quick implementation.
Co-Founder and CEO Dean Dorcas elaborated on the company’s foundational goal, stating, “We founded Easy Metrics to help warehouse executives address cost challenges by providing data that empowers them to make daily business decisions.” This latest offering seeks to further strengthen the operational insights available to 3PLs, allowing them to view their operational cost structures as profit centres and thereby maximising value for both customers and shareholders.
As the 3PL industry continues to evolve, the introduction of advanced profitability management tools could redefine supplier relationship dynamics, foster collaboration, and help logistics providers address supply shortages more effectively.
Source: Noah Wire Services
Subscribe to Industry Updates
