Bart Kempff - Levels of Outsourcing in Third Party Logistics Services
When it comes to the relationship you will have with them as a shipper, not all third-party logistics providers are made equal. So, now that you know what a 3PL is and what types of third-party logistics services are available.
When it comes to the relationship you will have with them as a shipper, not all third-party logistics providers are made equal. So, now that you know what a 3PL is and what types of third-party logistics services are available. According to Bart Kempff, consider the following types of levels of outsourcing:
Transactional Outsourcing: Transactional outsourcing is based on one-time transactions with no long-term contracts or connection between the 3PL and the outsourcing firm.
Tactical Outsourcing: Long-term outsourcing with negotiated contracts and linked IT systems to allow for free information flow and supply chain visibility.
Strategic Outsourcing: 3PL businesses become partners in supply chain management and establish transactional transparency through long-term collaborations with successful outcomes.
When our clients outsource to Cerasis, we have both a tactical and strategic partnership (process elimination and automation, including linking our TMS with an ERP to ensure you have the correct freight class). This means that some third-party logistics firms can provide the previously mentioned two levels of outsourcing. However, on the transactional side, this is usually centred on cost, and in our opinion, the former two are the focus, not the first, for actual long-term savings. Transactional third-party logistics services are for you if you're an e-shopper or sending a one-time shipment. Look at tactical and strategic outsourcing third-party logistics services providers if you have a supply chain and make regular shipments.