Since 1980s, Third Party Logistics has been introduced in the logistics market. It is defined as "Strategic alliance relationship between customer and logistics service provider under the long-term contract for the purpose of accomplishing logistics e...
Since 1980s, Third Party Logistics has been introduced in the logistics market. It is defined as "Strategic alliance relationship between customer and logistics service provider under the long-term contract for the purpose of accomplishing logistics efficency with outsourcing for the part or all of the logistics functions." A meaning of logistics outsourcing focuses on the cost reduction in the only aspect of operation function, but the purpose of this research is to identify the methods need to be taken when choosing an effective third party logistics provider. The use of third party logistics provides a competitive advantage in today's business world. The optimal solution for a company choosing a third party logistics provider would be some kinds of processes.
The intention of this research is to identify the most effective ways to choosing a third party logistics provider. Logistics management consists of three core functions : transportation management, inventory management and value added services. Third party logistics is defined as when a third party is brought in to help manage these functions. A TPL provider is an independent economic entity that creates value for its client. The TPL industry is constantly changing, although its existence is nothing new. The range of value propositions they offer today has changed dramatically in recent years. Global industry consolidation, technology integration, industry alliance networks have driven this change.
Therefore, the focus of this artical is how to choose an effective TPL Provider. TPL will be able to be implemented and useful in nearly every industry, whether it is retail, service, manufacturing, etc. It will be also possible for a company to use more than one TPL provider. This research shows that TPL cna be very effective if the proper tools are used in implementing one.