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The importance of third party logistics
The importance of third party logistics
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5 Reasons to Use a 3PL to Manage your Supply Chain
There are multiple benefits companies gain by outsourcing supply chain management to a value-added 3PL. Third party logistics offers an all in one solution for assembly, packaging, warehousing, and distribution. Utilizing a 3PL provides businesses with a reliable logistics advantage, and maximizes profitability through combined knowledge and resources.
Resource Network
We have a vast resource network available that provides advantages over inhouse supply chains. Using a 3PLs resource network, each step in the supply chain can be executed in the most efficient, cost effective way. We can leverage relationships and volume discounts, which results in lower overhead and the fastest possible service, you benefit from our large client base. Choosing a 3Pl provider allows your company to benefit from resources which are unavailable in-house, with lower volume transactions.
Save Time & Money
Outsourcing logistics will save a wealth of time and money for your small to midsized company. Using a 3PL provider eliminates the need to invest i...
The Trio Program here at Elgin Community College is to help students with disadvantaged backgrounds, such as documented disabilities (learning or physical), financial problems (low-income family/household) and those who are a 1st generation college student (parent(s)/legal guardian(s) didn’t graduate from a 4-year college). The Trio program provides 3 different programs, which is: (1) The Trio Student Services (SSS), (2) The Trio Student Services English as a second language (SSS/ESL), and (3) The Trio Upward Bound (UB).
With different prices and services across the facilities, management is trying to identify opportunities to standardize costs and services across the business units. The goal of this case study is to update Deere and Company’s logistics by recommending solutions to cut logistics cost by 69 million over 3 years
The industry has loyal customers with broad customer base that lowers the collective bargaining power of buyers to medium. The switching cost is very low and thus the customers can turn to a service provider who provide faster and innovative service but this is overcome by customized services and integrating into their customer supply chain.
Per Kalogeropoulos (2016), the company is better able to ensure product availability while managing their costs because of their latest logistics initiative. They have recently created a network of deployment centers that reduces the time between when the product leaves a supplier to when it hits the shelf at the Home Depot store which drives profits higher. Parnell (2014), relays that companies who use low-cost strategy seek distribution channels that minimize cost. Home Depot’s new logistics initiative provides the company with economies of scale and a market advantage because it adds to their low-cost
A supply chain is a system through which organizations deliver their products and services to their customers. The network begins with the basic ingredients to start the chain of supply, which are the suppliers that supply raw materials, ingredients, and so on. From there, it will transfer the supplies to the manufacturer who builds, assembles, converts, or furnishes a product. The chain now needs to get the product to the consumer by transporting the finished product from the manufacturer through a warehouse or distribution center. An example is that Wal-Mart has a nearby distribution center where products are delivered there and then split up to be delivered to a retail Wal-Mart. “Wal-Mart will take responsibility for breaking down larger loads and delivering the product to other Wal-Mart stores” (Ehring 1).
The parcel service industry is dominated by four carriers that make up 95 percent of the industries domestic revenue. Over the years, the industry has had an increase growth rate over time and an increased role in the economy. This is due to the way manufacturing companies are now operating. With the growth of the parcel service ...
IT management also prepared UPS for BCP-DR to avoid downtime. UPS’s IT infrastructure allowed customisations to incorporate unique functional requirements of customers. UPS also reduced its application development time by reducing rework. It created reusable modular applications. UPS has been very receptive towards the opportunities created by the IT to boost its core business. Even after this UPS was not able to keep up its pace with every valuable system development request. By 2000, UPS had a major share in domestic integrated package delivery services, but had an insignificant share in international, though the international market was growing at a double-digit rate. Therefore, the UPS management decided to allocate IT resources to the most strategic opportunities and preserve as appropriate via infrastructure
...pital resources like distribution vehicles and storage warehouses should be outsourced to help reduce the high cost of operation which in turn can lead to reduction of its products price. The company should concentrate on product development and evolution and delegate distribution roles to outsourced firms. Such initiatives have worked well in the new Indian market and should be implemented in other areas.
Rao, K., and Young, R. R. (1994) Global supply chains: Factors influencing outsourcing of logistics functions. International journal of physical distribution and logistics management. Vol. 24. No. 6.
Li & Fung is a kind of 4PL which is a fourth party logistics that handles the complete end to end supply chain network. It is 4PL because the concept of a 4PL provider is an integrator that accumulates resources, capabilities and technologies to run complete supply chain solutions which is the main work of Li & Fung. Since Li & Fung source its items from various global companies, they tend to create competition among these companies. To source from a good and capable company, Li & Fung will have to concentrate on a cluster area of that particular item they intend to source. Let’s say if they want to source a better material for their cloth manufacturing, they will go to that cluster area where there will be different companies that deal in the same material. Within that particular cluster area, they will find a better company that can contract with. Cluster brings companies that are in the same industry in one geographical area. To maintain the success of a cluster, there must be competition among these companies. According to Michael Porter “Productivity rest on how companies compete, not on the particular fields they compete in.” This shows that competition brings in new companies into the cluster thus strengthen the success of that cluster. Competition and global network can also increase productivity in any cluster area because of the pace of innovations and advance technology available in that cluster
The United Parcel Service has taken steps to restructure itself from an operations-oriented company into a market driven industry. Recent findings suggested the need to achieve better external customer satisfaction. The steps taken were to improve the overall of all customers that utilize the services at UPS. Other key areas that need improvement are volume logistics and customer logistics. The main priority at UPS is to deliver the package on time. They provide a much-anticipated alternative to the monopoly of the United States Postal Service. This competitor has been unreliable on multiple occasions. The average customer is feed up with the inconsistencies of the United States Postal Service. Unlike this company, the United Parcel Service helped define the word efficiency. Even from the earliest days, when Jim Casey and Claude Ryan, two Seattle teens, gave life to the now world-known UPS delivery company. ”Management is the...
Outbound logistics: They are made up of centralized logistic centers to promote efficiency, global network, reduced emission of CO2 by 22% to ensure ecological sustainability and lastly to improve customer service.
In other words, it aims to link all the supply chain agents to jointly cooperate within the firm as a way to maximize productivity in the supply chain and deliver the most benefits to all related parties [2].
Distribution- work on alternatives of outsourcing the distribution network or transportation routes. Should focus on outsource this non-core business activities if it is non-profitable. It is costly by not understanding the multi distribution network in standard line delivery (Multiple drop off points through retail channel sales)
Outsourcing is the final option for logistics management. When this happens, transportation firms concentrate on logistics, and the company can concentrate on it’s production. There are many cost savings using this type of program, however that lack of control can negatively effect many companies.