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Third party logistics providers are
a crucial link in the supply chain –
connecting the areas of production
and retail and encompassing a
number of value-added services. In
the past, many logistics providers
specialised in a single supply chain
management function. However, with
significant changes to the supply
chain as a result of consumer demand,
greater efficiencies and an increased
focus on sustainability, more and more
services have been added to their
portfolio.
This expansion is often in response
to requests from customers who
are recognising the potential of
integrated logistics and a concern that
outsourcing each separate supply
chain function results in growing
management overheads and less
time to focus on core areas of their
business.
Simplicity
By offering multiple services under
one roof, integrated logistics providers
can be flexible to adapt to changes in
demand and have the opportunity to
develop and optimise their role to ensure
that customers have a streamlined and
efficient supply chain operation.
Manufacturers and producers often
have an increasingly complex supply
chain and by working with an integrated
logistics provider they can simplify this -
improving service levels and shortening
lead times for retailers. Additionally, they
only have one point of contact which
means that should any issues arise, they
can be dealt with swiftly and efficiently
without time being wasted in managing
and liaising with different providers.
Cost savings are an important driver
in any integrated logistics provider’s
strategy. By working closely with
customers and building a solid
partnership, progressive logistics
providers can proactively identify weak
spots in the supply chain and provide
solutions to streamline the process and
ultimately save money.
Many third party providers have also
adapted to incorporate a number of
value-added logistics services into their
portfolio, such as re-packaging, cross
docking and inverting pallets, which
can all be part of creating a tailored
plan that adds real value and helps
their customers to meet supply chain
objectives whilst saving on costs.
Optimising the supply
chain
Duco Buijze, CEO at Partner Logistics, examines how third party logistics
providers have responded to the need for ultra-efficient supply chains.
Sustainability
With increasing pressure to hit
sustainability targets, integrated
logistics providers also support their
customers in driving down carbon
emissions. At Partner Logistics, we are
developing and facilitating projects
where our customers can work together
to optimise complete supply chain flow,
yielding far more synergy than they do
individually.
For example, one of these projects is
‘horizontal collaboration’, which works
in the same way as car-pooling. If one
of our customers is delivering five
pallets to a retailer in London at 8am
and another customer is delivering 10
pallets to the same retailer at 9am then
we can liaise with all parties to arrange
one delivery at 8.30am. By combining
shipments, we can reduce carbon
emissions through reducing the amount
of freezer trailers on the road, whilst
also reducing operating costs.
Next steps
Innovative third party logistics providers
are already proving that they have the
flexibility and adaptability to take on
new challenges and are well equipped
to take on a bigger role within the
supply chain. With increased consumer
demand fuelled by a rise in ecommerce,
the next step for Partner Logistics is
to develop into a fourth party logistics
provider, facilitating, coordinating and
directing the supply chains of leading
manufacturers and producers in the
frozen food industry.
22
Logistics Business Magazine | September 2015
Contract Logistics