Supply Chain Wk 6 Dq 1
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Supply Chain Wk 6 Dq 1
Introduction
The use and significance of third party logistics services has dramatically increased over the last period of more than thirty years. In the supply chain management and industry of logistics, more companies are utilizing outsourcing services. This increased to cover commodities, geographies, transport modes, and integration of existing transportation services and warehousing. This has been attributed to the growing necessity of provision of one-stop shop services to specific customers under the functions of supply chain management. In addition, the bundling up requirement by different companies has been realized with the impact of minimizing costs towards multiple logistics. The growing increase in third party logistics services has had a tremendous positive influence in supply chain management.
Discussion
The significance of third party logistics cannot be underestimated. It helps in cutting of costs, while saving time for the respective client (Mentzer, 2011). This is facilitated by continuous update and adaptation to customer’s new requirements. Robinson (2013) argues that there is low commitment of capital. This means that the client does not have to be bothered by owning transport assets or warehouses. The capital for logistics is hugely minimized. Third party logistics provides for easy flexibility. This is determined by the geographical aspects in the part of the providers unlike the reach of the clients (Zhang, 2005). Resources and workforce are also attributed with flexibility to the advantage of the client.
Conclusion
Third
party logistics services are essential in supply chain management functions.
This has increased over the years due to the growing concern by different
clients on encompassing all needs under one provision. The requirement of
warehousing and transport assets are all reduced which in turn helps reduce
costs and time for the clients. This has helped in growth of the supply chain
management needs from over thirty years ago to the present circumstances.
References
Mentzer, J. T. (2011). Supply chain management. Thousand Oaks, California: Sage Publications.
Robinson, A. (2013). History, Origins, and carious Definitions of 3PL (Third party Logistics). [Web log comment]. Retrieved from http://cerasis.com/2013/09/16/3pl/
Zhang, C. (2005). Third party logistics management. Berlin: Logos-Verl.