Advantages and Disadvantages of Third Party Logistics With the growth and development of a company, especially in the global market, the business relies heavily on third party logistics to deliver their products or services to their customers. Logistics has been a key factor in every successful business, and especially with the ever-increasing business needs of consumers, third party logistics will no longer be a part of the equation. But what will happen when you are no longer relying on third party logistics for your business? Will you still need to have your own logistics provider or will you be able to find one with the same professionalism and credibility as any major logistics provider in your country?    It is important to first understand what third party means. This term actually refers to any of the logistics providers that are independent or that are not attached to any particular company. These third party logistics providers offer a wide range of services including warehousing, transportation and export. Almost all of them have their own logistic department which handles every single transaction made by their clients. However, there are also third party logisticians who are closely associated or working under a specific company. This can make them less competitive compared to other suppliers since the cost of running their own logistics provider is usually higher.    There are several advantages of working with a third party logistics supplier. One of the main advantages is that they can offer a wide range of services at cheaper prices. Most of them have the necessary connections and experience to offer high quality services at cheaper prices compared to their own businesses. It is even better if they can give you access to worldwide freight rates since the majority of the countries worldwide are connected through common shipping routes.    Another advantage of working with a third party logistics provider is the fact that they can offer highly flexible transport solutions. When it comes to the supply chain management, third party logistics can help you out tremendously by giving you more time, patience and flexibility when it comes to the transportation of your goods and services. They have highly experienced and knowledgeable employees who can help you whenever you need them. Furthermore, they have a very good understanding of the legalities involved in shipping and import and export business.    Using third party logistics has its own set of advantages and disadvantages. usps zone map of using third party logistics is that it provides cost-effective solutions. Since they don't have their own transport vehicles and trucks, their logistics providers have to pay lower prices for gas, oil and insurance. The drivers are not prone to get sick thus the chances of having a vehicle breakdown are greatly reduced. They also don't require you to maintain a huge fleet of trucks and vehicles. This will save you additional expenses for the maintenance of your vehicles.    Yet another great advantage of using third party logistics is the flexibility it offers. You don't have to hire a large number of employees for the purpose of shipping and receiving your products hence saving you money on the salaries and other overhead costs. This will allow you to focus more on improving your production processes instead of looking for additional manpower. You can also save on the rental costs of the trucks and other machineries as well.    However, there are some disadvantages of third party logistics. One of the disadvantages is that you will be dependent on the company from where the raw materials you need are procured. Another drawback is that third party logistics may not offer you a dedicated driver which will result you to have a group of amateurs handling your shipments.    One of the best ways of ensuring that you are using the right method of logistics services is by hiring an experienced third party logistics provider. The professional group will be well-trained and fully aware of all the nuances involved in third party shipping. Furthermore, they will know where to source out the raw materials from whenever you need them. With experienced and qualified professionals handling your shipments, you can rest assured that the products you have ordered will reach your clients on time.

Forum Role: Participant

Topics Started: 0

Replies Created: 0