In shipping, logistics management refers to the management of the shipping process in three respects: transportation planning, transportation monitoring, and the measurement of Key Performance Indicators (KPIs). These disciplines form what is known as a Transportation Management System (TMS), which manages the shipping process from the planning phase to the quality assessment phase. With a TMS, shippers have greater control over the shipping process and can improve the quality and cost of the shipping process by:
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Key Performance Indicators (KPIs) are metrics that are used to track and quantify the progress of the shipping process. When it comes to the shipping process, a KPI is an indicator that is used to help you assess how the business is doing. For a shipper that delivers a consistently high level of service, the cost of not employing logistical solutions in their shipping process would be potentially devastating.
Today, almost all shippers know that they need to monitor the shipping process. For many shippers, particularly those that operate on a global scale, knowing that they need to be informed of the carrier’s payment practices, billing practices, customs clearance, and handling of documentation is not enough.
Today, more than 50% of large shippers and 90% of midsize and small shippers are using a third-party logistics (3PL) provider. For many companies, 3PL’s are a great option. But they do offer their own logistics solutions, which can be more comprehensive than what a standard 3PL provider offers. For example, a customer that doesn’t mind paying for its shipping process and implementing a temporary staffing solution can opt to have its shipping process, such as the CMS and freight transportation, managed by a 3PL provider. But if the customer requires a more comprehensive approach to the shipping process or wants its shipping process handled internally can choose from a variety of options in which a 3PL provider functions.
logistics software-utilizing the expertise of a 3PL provider-is the most popular option for implementing logistics. But it is not the only option. When you manage your shipping process through logistics software, you can choose from a variety of options in which a 3PL provider functions. There are three types of 3PL providers: standard 3PL providers, service developers, customer adapters and customer developers.
Standalone Customer adapters are small to midsize companies that oversee a segment of a company’s shipping process. Expect to pay $1-$20 per month depending on the service level. Service developers are a type of customer adapter that finances a customer’s shipping process, which allows the customer to have control over their shipping process. Customer developers are a type of customer adapter that finances the shipping process and has control over the shipping process. They are bothYNAP(long termAction Programmable) customer adapters and Non-YNAP( Independence Programmable) customer developers.
Non-YNAP(Non-Standard) customer developers are either small to midsize companies that don’t have their own logistics department or large companies that don’t operate in the same logistics as a major retailer or distributor. They oversee a segment of the shipping process or travel related operations. Customers that need a comprehensive approach to the shipping process and simply don’t want to invest the time or money required to have their shipping process managed by a 3PL provider can outsource to a customer developer. The customer developerConclusion
Do you need to hire your own logistic expert to oversee your shipping process? Does your company profit from avoiding the expense of hiring in house logistics experts? More often than not, companies that can’t afford their own logistic expert turn to customer developers. Customer developers oversee a company’s shipping process and propose innovative solutions. They fulfill a range of shipping functions, including but not limited to: invoice management, sales and distribution, delivery, cross docking, freight billing, inventory management, IFTA document management, customer service, and point of sale.
Do you have the budget to hire your own logistic expert? Knowing how to evaluate logistic providers takes time and money.