Introduction Blanchard (2006) defined third party logistics as, “A single entity that coordinates all the logistics requirements for a given company/agency.” Today’s world business environment has become so competitive that companies in order to be successful in the market must deal with different resources for satisfying their customer need. In the past decade or so the competitive global market has made a big influence in the growing for external business. Third party logistics providers are more and more employing external companies for inventory management, transportation, warehousing, and other value added activities for customer services. Third party logistics ultimate goal is to provide a competitive advantage to the organization for which they are serving. According to Cardinal Logistics (2012), “Third-Party Logistics is an effective way to reduce operational costs, and allow a company to focus on their core competencies.
Overview of Third Party Logistics Between the year of 1970 and 1980 it was recognizes as the first generation of the third party logistics for providing services for shipping and transportation. By the 1980’s through the 1990’s were non-asset and asset based organizations by increasing the services level of contribution and by the 2000’s third party logistics were generally based on increasing the supply chain integration. According to Write Pass (2012),
A Third Party Logistics providers (3PL), can be identified
The third party logistics (TPL) and fourth party logistics (FPL) act as a support system for companies to effectively formulate and manage their supply chain process.
Due to the large quantity of freight and the long distance that it must travel to arrive to its destination exporters and importers alike have found logistic service providers essential to engage in international trade (Rodriguez, Comtois, Slack, 2013). While some Logistics service providers focus only on the area of transportation others specialize in freight consolidation, distribution management, and warehousing (Robinson, 2014). They have enough market knowledge, information and communication systems to offer supply chain solutions tailored to the specific needs of any company be it small or large (Rodriguez, Comtois, Slack,
Third-party services are increasing nationally, regionally and locally to provide restaurateurs with an array of delivery options. Managing the delivery logistics is often challenging for restaurants that would prefer concentrating on food preparation. The good news is that you don 't have to buy a delivery vehicle, train drivers and deal with delivery issues if you outsource your deliveries.
Over time, new healthcare reform measures were causing fundamental changes in reimbursement for services to hospitals and IDNs. Consequently, healthcare providers had to establish financial stability. This opened the door for third-party logistics providers (3PLs) to establish a strong presence in the healthcare industry. 3PLs? offered solutions to mitigate transportation and supply chain expenses that streamlined the order-to-delivery process and reduced expenses.
Over time, new healthcare reform measures were causing fundamental changes in reimbursement for services to hospitals and IDNs. Consequently, healthcare providers had to establish financial stability. This opened the door for third-party logistics providers (3PLs) to establish a strong presence in the healthcare industry. 3PLs? offered solutions to mitigate transportation and supply chain expenses that streamlined the order-to-delivery process and reduced expenses.
The freight services provided by APL Logistics included chain visibility for not only Billabong, but their customers and suppliers as well. This is an example of a flexible tripartite enterprise collaboration, where each party can plan, manage and track shipments (Naim et.al 2006, p.306). Additionally, there exists the capability to alter the intermodal choices, to benefit the supply chain. Intermodal capabilities are facilitated by a full service 3PL provider for optimal results allowing greater access and
In recent years, Third Party Logistics (3PL) service providers play a very important role in a supply chain of an organization. A brief literature review is given in this section of the paper. Tate (1996) identified seven factors (compatibility, deep understanding of a partner's business needs, open communications, commitment, fairness, flexibility, and trust) that improved long- term relationship between 3PL and their customers. Logan (2000) used agency theory to help in bonding 3PL/customers relationships. It is postulated that, cost reduction and services improvement criteria are most expected by clients to avoid conflicts with their 3PL. Fawcett and Smith (1995) identified five criteria’s to evaluate the 3PL performance,
Despite the third- party logistics was an improvement studies area in a recent business market, the studies of this area still existed some arguments and limitation (Marasco, 2008). The literature review in TPL studies based on a comprehensive literature review, which including some relevant research paper and journal paper published within the period 1990 to recent years (Selviaridis and spring, 2007). Some existing studies focus on the benefits and limitation of TPL services for company management. Leahy (1995) and other scholars were defined as the TPL is usually associated with the providing of multiple services rather than just isolation transport functions (Leahy et al., 1995). Therefore, some other research believes that the TPL services can reduce the total
The third party logistic is use by the outside company to perform all or part of the firm’s material and distribution of the product. 3PL are the independent providers,they are providing a single or multiple logistics services to a purchasing company. Infact the 3PL does not hold the ownership of the product distribution and they are responsible to perform the activities of the logistics for the purchasing firms. They also have a long-term relationship and commitment between the two parties. A company may outsource its various logistics fuctions to one or more third party logistics alinged with the management strategy to receive benefits of increasing flexibility , reducing costs and for improving
Companies can significantly cut investment on logistics associated assets as well as liability. A customer does not have to use “in-house” and any logistics assets.
Logistics is one of the last processes of the company who can improve corporate efficiency by the outsourcing. It also reduces the distribution cost where manufacturing firm has many products and they do have also its outlets globally. 3PL has grabbed the opportunity for the shipper in all expects, they are low cost then shipper, innovative machine, skilled labor and fast moving ability. 3PL is improving its technology and also give technical knowhow to its technicians for establishing better alliances. The research directly targets the main stream of the
ICS is one of the most widely recognized third party logistics companies in its industry. We are seamless to the end customer as we represent the manufactures. We provide emerging manufactures the necessary infrastructure and knowledge necessary to get their product into the market. With 20 plus years of experience in the market and providing world class service consultants and manufacturers rely on these qualities of ICS. The support of our parent company AmerisourceBergen has allowed ICS to make significant investments in infrastructure and human capital. Infrastructure investments such as warehouses and equipment has been instrumental in the optimization of inventory
It is known to us, “in each industry, the customer is god, is operator's food and clothing parents.” This tells us that customers are important to organizations. With the current intense competition in logistics nowadays, most companies can provide high quality goods, even are willing to cut down prices if reasonable. However, how can suppliers gain a competitive advantage when high quality is expected and price must be maintained at a level to generate a reasonable return? In our views, it is no doubt that how various supplier service activities are valued by customers, more specifically, that is, the ability of logistics
Indeed use of third-party logistics (3PL) firms in transportation helps firms to meet complexities of global trade, worldwide increased competition, as well as the constant downward pressure in terms of prices and margins. This is in a bid to build up better logistic systems that can fulfill their needs for better services at a lower cost. Among the reasons as to why companies use 3PL firms is to outsource non-strategic activities which enables organizations to concentrate on the major competencies as well as to exploit external logistics expertise, (Ivan Su Hertz, Susanne, 2009). These third party firms have the capability of developing unique assets, acquiring the necessary resources and achieving superior logistics performance using 3PL relations. Companies therefore find it efficient and effective method of achieving the needed service with no engaging so much in investing new capabilities and in assets upon entering into a relationship with 3PL firms.
In view of the rapidly and constantly changing business environment globally and fast evolving trade and commerce scenario in India vis-à-vis global market, there is increasing requirement of reliable and dependable integrated logistics solutions providers who can provide comprehensive, professional and dependable logistics support to the industry, keeping the same in mind and with the vision to provide quality and professional comprehensive logistics solutions to the international & domestic trade.