For building materials distributors, third-party logistics providers (3PLs) offer flexibility, reach, and scalability. But in a fast-moving industry where contractors expect real-time updates and flawless delivery execution, managing 3PLs manually—or with disconnected systems—can quickly lead to delays, miscommunication, and service breakdowns.
The solution? Digital transformation. By integrating technology into every aspect of your 3PL partnerships, you can move from reactive coordination to proactive, data-driven collaboration that improves efficiency, visibility, and customer satisfaction.
Here’s how to digitally transform how you work with 3PLs and turn outsourced logistics into a true competitive advantage.
- Integrate Systems for End-to-End Visibility
The Challenge:
Manually emailing spreadsheets, updating portals, or calling for delivery status creates blind spots and slows down your team.
The Transformation:
Connect your ERP or TMS to your 3PL’s system via API or EDI
Sync orders, tracking numbers, and delivery confirmations automatically
Provide access to a shared dashboard showing order status, shipment progress, and exception alerts
Result: Real-time visibility for both parties, fewer manual tasks, and faster response to delivery issues.
- Automate Order Routing and Load Tendering
The Challenge:
Routing orders to 3PLs manually wastes time and risks errors—especially when volumes spike or orders are urgent.
The Transformation:
Automatically assign shipments to the best-fit 3PL based on location, capacity, or service level
Use smart tendering logic to balance loads across providers
Allow 3PLs to accept or reject loads digitally with instant updates to your dispatch schedule
Outcome: Smoother coordination, fewer emails, and scalable logistics workflows.
- Enable Real-Time Delivery Tracking for You and Your Customers
The Challenge:
Without real-time tracking, your team can’t manage exceptions—and your customers stay in the dark.
The Transformation:
Feed GPS data from 3PL vehicles into your delivery tracking system
Offer branded tracking portals or live ETA links for contractors
Use geofencing to trigger notifications on arrival, unloading, and departure
Bonus: You improve job site readiness and build trust through proactive communication.
- Standardize Digital POD and Documentation
The Challenge:
Paper proof of delivery (POD) slows down billing and increases disputes over time, location, or item condition.
The Transformation:
Require 3PLs to submit digital PODs with time stamps, signatures, and photos
Store delivery records automatically in your ERP or CRM
Enable instant access to documentation for customer service and finance teams
Result: Faster dispute resolution, cleaner records, and faster invoicing.
- Use Scorecards to Digitally Track 3PL Performance
The Challenge:
Without performance data, it’s hard to know which partners help you grow—and which slow you down.
The Transformation:
Track on-time delivery rates, first-attempt success, damage claims, and exception resolution times
Automate reports and reviews
Set digital SLAs with alerts when metrics fall below threshold
Benefit: Make better decisions on which 3PLs to scale with, retrain, or replace.
- Digitize Communication and Exception Handling
The Challenge:
Phone calls and emails are inefficient when problems arise—especially across multiple job sites or warehouses.
The Transformation:
Use real-time messaging tools or shared ticketing systems
Route exception alerts to the right internal or external contact automatically
Document all communications and resolutions in one system
Pro Tip: Provide 3PLs with mobile apps or portals to report issues from the field.
- Leverage Data to Forecast and Plan Jointly
The Challenge:
Reactive 3PL management makes it hard to plan for seasonal surges or project-based demand.
The Transformation:
Share real-time order forecasts and delivery volume expectations
Use data to plan fleet allocation and regional capacity
Identify delivery patterns and adjust routes, shift timing, or warehouse staging accordingly
Strategic value: Build smarter long-term partnerships and scale more confidently.
Final Thoughts
Digital transformation isn’t just about using more tools—it’s about creating connected, efficient, and transparent workflows between your team and your third-party logistics providers. By streamlining how you route orders, track deliveries, and measure performance, you improve service levels, reduce manual overhead, and empower your team to focus on growth—not fire drills.
The future of 3PL collaboration is digital. And the distributors who embrace it will deliver faster, smarter, and more reliably—no matter who’s behind the wheel.
