Three Types of StrategicAlliancesThird Party Logistics (3PL)Retailer-SupplierPartnerships(RSP）DistributorIntegration (Dl)8-6
8-6 Three Types of Strategic Alliances ⚫ Third Party Logistics (3PL) ⚫ Retailer–Supplier Partnerships (RSP) ⚫ Distributor Integration (DI)
8.3 Third Party Logistics (3PL)Useof3PLproviderstotakeoveracompany'slogisticsfunctionsAlmosta $85billionindustryby20048%ofall logisticscostsattributedto3PL8-7
8-7 8.3 Third Party Logistics (3PL) ⚫ Use of 3PL providers to take over a company’s logistics functions ⚫ Almost a $85billion industry by 2004 ⚫ 8% of all logistics costs attributed to 3PL
WhatIs 3PL?StrategicpartnershipLongtermcommitmentMulti-functionarrangementProcessintegrationLargerangeof3PLcompaniesNon-assetowning3PLcompaniescalled4PL·Provide services butnottrucks,warehousesPrevalentusagewithlargercompanies8-8
8-8 What Is 3PL? ⚫ Strategic partnership ⚫ Long term commitment ⚫ Multi-function arrangement ⚫ Process integration ⚫ Large range of 3PL companies ⚫ Non-asset owning 3PL companies called 4PL ⚫ Provide services but not trucks, warehouses ⚫ Prevalent usage with larger companies
3PLAdvantagesFocusonCoreStrengthsAllowsacompanytofocusonits corecompetencies·Logistics expertise left to the logistics experts8-9
8-9 3PL Advantages ⚫ Focus on Core Strengths ⚫ Allows a company to focus on its core competencies ⚫ Logistics expertise left to the logistics experts
3PLAdvantages·ProvidesTechnologicalFlexibilityTechnologyadvancesadoptedbybetter3PLprovidersAdoptionpossibleby3PLsinaquicker,morecost-effective way3PLsmay have the capability to meet theneeds of a firm's potential customers8-10
8-10 3PL Advantages ⚫ Provides Technological Flexibility ⚫ Technology advances adopted by better 3PL providers ⚫ Adoption possible by 3PLs in a quicker, more cost-effective way ⚫ 3PLs may have the capability to meet the needs of a firm’s potential customers