The warehouse provider has the responsibility for the care and custody of your products. Less than professional handling of your products, in the manner you require, can result in costly consequences—such as lost or damaged goods, lost sales opportunities, unhappy customers, or even shutting down a production line!

In addition, the warehouse provider often is considered by the customer as your agent. The provider’s image, reputation and service levels all can affect the way your company is perceived.

The last thing you need when you retain a logistics provider is more problems and headaches. At Elston-Richards, with our professional staff, breadth of experience and time-tested processes, we can help you realize logistics services as a benefit rather than a cost. We recognize the great responsibility entailed in being selected as your services provider.

From a client’s perspective, there are some basic things you can do to help ensure that your selection is the best fit for your company’s needs. Here are some ideas:

I. In the Beginning...Complete Accurate Information

It all starts with the warehouse provider understanding exactly what goals and objectives you are striving to achieve. An accurate description of the product and its characteristics will minimize the need for assumptions on the provider’s part and ensure fewer surprises down the road.

A lack of information and consequent misunderstandings can result in a need to adjust rates...an insufficient allocation of space and/or labor to meet your needs...improper set-up of maintenance records or reconciliation of inventory records.

If the service provider is forced to “guess-timate” in order to provide a quotation for services, it often leads to a no-win situation for all concerned. Good preparation and information sharing from the outset will result in the design of more effective services, more efficient processes, more equitable rates and a smoother start-up operation.

II. Selection Criteria...Look, Learn & Listen

Whenever possible, you should take the opportunity to visit the warehouse facility. Much can be gained by seeing for yourself the conditions in and around the warehouse operation. Speaking to the provider’s management and staff will also give you a better understanding of who you will be working with and help determine whether your company culture meshes with that of the provider. Here are some things to look for during your visit:

Financial Stability. This is extremely important. If a service provider is operating with shaky cash flow, your level of service could be compromised. And if a provider files for bankruptcy, you will most likely experience a disruption in service and delays in obtaining your product. Should they opt to close a warehouse, you will not only incur relocation costs, but will need to start over on the process of finding another qualified provider.

Management. As the saying goes, “good help is hard to find.” Determine the management structure and who will be assigned to your account. What are the people’s backgrounds, their experience? A one-man show will not allow for meeting your time-sensitive requests. Observe the interest level of the provider to determine whether they really want to handle your business, or just expand their portfolio. You need to be confident your account will receive the professional attention it deserves.

Labor. Ask about any employee relations problems they may have experienced. What is their turnover rate? Ask about their labor history with regard to strikes or other work stoppages that might adversely affect their ability to service your customers.

Systems Capabilities. Determine whether the provider’s warehouse management systems are sufficient to meet your needs. How capable is the provider in terms of interfacing systems with your company? Do they have EDI capabilities?

Sanitation. Food and grocery products require specified levels of sanitation and pest control. However, regardless of the commodity, one can tell a lot about the provider by the way in which the facility, equipment and inventory are maintained. Neat and orderly conditions are indicative of safe, organized and well-run operations.

Facility. Check the layout of the facility: Are the number of dock doors sufficient? Are the door openings adequate? What is the ceiling height? Is the lighting satisfactory? What type of security is in place? What is the condition of the roof—any leaks, etc? What other commodities does the provider warehouse; are there any concerns about mixing with your products? Is the facility leased or owned? If leased, find out when the existing lease expires. Where is the facility located; is there easy access to the interstate system and major access roads?

Reputation. Warehousing is a reputation business. Take the time to ask for and check references of current and past clients.

Niche. Learn the commodities and industries with which the provider has first-hand experience. Being familiar with similar products and handling requirements can be advantageous in terms of lower rates and less damage. When the provider is an expert in the field, they can also function as an information resource to your company with regard to logistics and process improvements.

III. Selection and Follow-Through

Be open and honest in your appraisal. Beware of lowball quotes and promises that sound too good to be true. While everyone understands the importance of lowering costs, you should not dwell on the rate so exclusively that you overlook other considerations, that in the long run could actually cost you more.

Once the selection is made, you cannot “walk away.” It will be important to schedule follow-up meetings to ensure that the original assumptions were correct, and to make any necessary adjustments. The key is: don’t forget to communicate.

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