Question

transportation management

1. why would a company use an asset based 3PL service provider versus a non-asset based provider?

2. Dicuss the strategic needs and challenges that transportation managers face. How can 3PL service providers help them improve performance and reduce costs?

Answer 1

1. Companies Should use An asset Based 3PL service provider versus a non asset based provider because,

Strategic Presence - All the Asset Based 3PL service provider has Strategic Geographical Presence in terms of Reachability. They have their offices and pick up points at main locations of cities. Their Hubs are generally near major Highways , Railway Stations and ports for faster delivery.

Experiance and Expertise - Asset Based 3PL service providers have wide experiance in handling the shipments and cargos , also they have good no. of Experts in their teams which saves their time in optimizing smooth transport , Law of particular country or state which a common man dont knows.

Network and Assests- Generally they own all the assests used in transportation chain , from trucks, trained drivers to warehouse and delivery vehicles.

Assurance and Accuracy - As these Service providers owns all the assests of value chain in transportation of goods , the chance of mistake is less, these providers generally provides insaurance of the shipped goods. Also the cost of transportation is comparitively less due to Ownership of network assests.

2. The major Strategic needs and challenges faced by Transportation managers are -

Timely Delivery - The main job of Transportation manager is making the item availaible at right time at right place in desired quantity.

Cost- The cost of transportation changes with change in seasons, peak time , festival time , and with flactuating fuel prices. Keeping this cost neutral and providing timely delivery of products is major concern for transportation managers.

Government Interventions- Government imposes several rules and regulations, like emission standards , packaging waste standards , transportation taxes and clearances from federal , state and local authorities is a big challenge.

Availaibility of Trained Manpower - one of the major issue that arises is trained truck drivers, technicians , and manpower , availaibility of manpower at right time is a challenge.

As we have talked about the Strenghts of assest based 3PL service providers, the 3PL service provider will provide huge help to Transportation managers as they are one stop shop for all the solutions of the challenges faced by transportation managers. From reducing cost to Timely delivery each and every concern can be resolved by mutual cooperation of 3PL providers and managers.3PL providers have assests and expertise which will help transpoertation managers.