Third Party Providers (3PL): Keeping the Wheels of Logistics Movement Turning

This week's lectures on supply networks was quite interesting because it arose my thought process about the capability of manufacturing firms and department chains, i.e Apple, Amazon, Macy's JCPenny, among others, are able to deliver items to their customers with just-in-time delivery process. Little did I know that behind the order fulfillment online and the desire to get our package or inventory on time rest on the shoulders of a silent giant behind the scene who work majestically to ensure an timely delivery of our items.
The process of ensuring the and orderly flow of goods from point of origin to the point of consumption encapsulates the logistics management. At this juncture of logistics movement from one point to another point comes silent giant, Third Party Logistics Providers. These firms, for example UPS, USPS, Fedex, DHL Express, Blue Water Trucking among others, leverage their expertise in delivering specialized and value-added operations in warehousing, packaging, distribution, transportation, tracking and tracing, cross-docking among others.

Third Party Logistics Providers, also known as 3PL, are an important player in the logistics movement equation and serves as the fulcrum around which the movement of goods and services revolves. These firms provide wide coverage of services ranging from inbound and outbound freight, order fulfillment, freight consolidation and even serving the entire the supply chain. This means the 3PL firms can pick up the package or inventory delivers it to the customer and return the same package or inventory if defect or wrongful delivery is detected. On top of these services, 3PL firms provide more extensive and detailed functions for its clients when it integrates more with customers as part of an expansive supply chain.

Third Party Providers are categorized based upon the types of services they provide their clients and also on the economies of scale involve in their operations. The classification of 3PL firms are; Standard 3PL; Service Developer 3PL; Customer Adapter 3PL and Customer Developer 3PL. Due to technological advancement couple with the need to garner an efficient supply chain process, 3PL firms are gradually shifting their operations to new form of logistics service called "Non-asset based logistics providers". This new form of logistics provision utilizes consulting on freight movement, transportation, warehousing, packaging among others without physically being involved in the movement of the inventory from point to another point.

3PL firms are strategically position to better serve their clients in a manner that married efficiency and effectiveness across the supply chain. In so doing, 3PL firms are elevating to a new form of logistics movement called on-demand technology which is geared towards delivering tailored solutions to clients relative to their supply chain requirements. Example of on-demand transportation are: Full Truck Load, Hotshot (direct, exclusive courier), next flight out and international expedited. This form of transportation also faciliated a timely and efficient mean of transporting goods and services to end-users that satisfy that desire for the mode of delivery for their inventory. 

Therefore, with the advent of massive movement of goods across the globe and the huge spending patterns of consumers globally, the need for 3PL firms can not be overstated. The role of 3PL is very critical in facilitating the exchange of goods and services and creating the swell ground for higher sales and profitability for their clients. Third Party Logistics Providers are situated at the junction where manufacturers are located on one side of the road and consumers on the other side while serving as the middleman in bridging the trade gap between the pair.

References:

http://searchmanufacturingerp.techtarget.com/feature/Keep-logistics-management-in-mind-when-selecting-a-3PL.

http://en.wikipedia.org/wiki/Third-party_logistics.