3pl in India and Its Growth

GROWTH OF 3PL IN

INDIA AND THEIR

CONTRIBUTION TO THE

EFFECTIVENESS IN

SUPPLY CHAIN

2010

GROWTH OF 3PL IN INDIA AND THEIR CONTRIBUTION TO THE

EFFECTIVENESS OF SUPPLY CHAIN

ABOUT 3PL:

Third party logistics (3PL) or contract logistics is the supply chain practice of outsourcing the

various logistic functions of inbound freight, customs consolidation, warehousing, distribution

and outbound freight to the client’s customer. The 3PL provider executes these logistics

functions on behalf of the client company by using its own assets and resources.

FOUR MAJOR 3PL SEGMENTS:

Non asset based domestic transportation management: 3PLs providing value added

transportation management services dealing with shipments originating in and destined to

domestic locations. Services are usually performed in conjunction with freight brokerage and are

often contractual.

Non asset based international transportation management: 3PLs providing value added

international transportation management services dealing with shipments and usually performed

in conjunction with freight forwarding, often contractual in nature.

Asset based dedicated contract carriage: 3PLs providing dedicated contract carriage services

supplying tractor, drivers and management. Trailers are normally included; contract terms are 1-

7 years.

Asset based value added warehousing/distribution: 3PLs normally providing long term

contract warehousing or distribution centre operations with a host of value add’s.

TYPES OF 3PL PROVIDERS:

Transportation based: The 3PL services provided by these type of firms are leveraged, they

utilize the assets of other companies and some are non leveraged where the principle emphasis is

on utilizing the transportation based assets of the parent organization. Basically, these firms

extend beyond the transportation activities to a more comprehensive set of logistic offering. Few

transportation based suppliers are FedEx logistics and UPS logistics.

Warehouse/ distribution...