Third party logistics, the abbreviation term is 3pl, indicates to companies which offer an outsourcing option for part or all the supply chain functions including transportation alternatives, freight management, tracking goods, warehousing, picking and packing, and so on for their customers. 3pl performs these tasks in a controlled and economic way.
3pls, Shippers and Carriers:
The firms or individuals who move the freight one place to another are called shippers. On the other hand, carriers refer to those organizations that provide the transportation services. The job of third party logistics is to give the access of carriers to shippers at the same time. As the shippers do not need to look for carriers individually, it saves time and money. Similarly, 3pls use those carriers to connect with shippers as much as they can.
Negotiation of price experience of 3pl:
Third party logistics have got a good experience on price negotiation than other companies. They are more skilled than shippers in case of settling carriers for low prices. It means that shippers are now more benefited by working with 3pls than they would benefit if they directly connect with carriers.
Maintaining all the administrative aspects of supply chain is 3pl’s responsibility. Those aspects include when the container of goods departure, when hit the destination, monitoring those containers while moving one place to another, and so on. Actually, 3pls complete all these tasks at a reasonable price for their clients. If 3pls did not provide these services to shippers, they may need to manage those things themselves, also gather administrative skills which would take time and a good amount of money.
A shipper is tension free after assigning supply chain management processes to a third party logistics firm, which will be liable for every step of supply chain. For example, the important part of management means packaging and storing freight in different places until it hits the final destination. And, this stage needs very careful monitoring. To prevent breakage or damage of some kind of delicate products, like ceramics, are moved cautiously. As 3pl is accountable for any kind of failure of supply chain functions, the shipper gets security against loss. Besides, it is a promise from 3pl to manage supply chain operations successfully.
Organizations can have a good attention on other tasks of the operation and devote more time for the development of other parts after transferring all supply chain responsibilities to 3pl firms. There are some reasons why clients prefer getting help of a third party logistics provider. Those are shipment times, inventory-loss rate, service cost, and overall efficiency. Third party logistics plays a vital role for supply chain management in the international market. Does your company need freight forwarding? Just contact the giant 3pl, Advantix logistics today.