Essay On Third Party Logistics

1. INTRODUCTION

Third Party Logistics (3PL) is defined as a provider of outsourced logistics services. Logistic services encompass anything that involves management of the way resources are moved to their specific destinations where they are required. Third party logistics is also referred to as outsourcing. Third Party Logistics usually specialize in providing integrated operation, warehousing and transportation services, accommodating customers' needs for their products and materials. Often, these services go beyond logistics and include value-added services related to the production or procurement of goods. According to Cakir (2009) one of the most important functions of the logistics department is the selection of efficient logistics service providers, because it brings significant savings for the organization. According to Cakir (2009) a standout amongst the most imperative elements of the logistics office is the choice of proficient logistics third party providers, since it brings noteworthy investment funds for the association. Due

There is no one standard accepted term, there is a number of different identifications to identify the common characteristics of third party logistics. (Lieb, Miller & Van Wassenhove, 1993: 35) defined 3PL as “Third-party logistics involves the use of external companies to perform logistics functions that have traditionally been performed within an organization. The functions performed by the third party can encompass the entire logistics process or selected activities within that process”. This definition explains that, third party logistics providers add value to their customers by providing any form of externalization of logistics activities previously performed “in-house” like transportation activities, integrated warehousing, distribution, forwarding, packaging, customs handling, kitting, and information management