Logistic Service Provider

Topics: Supply chain management, Logistics, Supply chain Pages: 7 (2113 words) Published: December 16, 2012







The supply – chain and logistics industry includes companies that move raw materials, finished goods, packages, and documents across the globe. It is one of the main phases in value chain concept in international business. The massive increase in the international trade has increased has increased the complexity of company supply chains. MNEs and other internationalizing firms require speed and efficiency in moving goods via supply chains around the world. To fulfil this need, competent logistic service providers like DHL that coordinate and control supply chains through a global business.

DHL here act as a facilitator that controls thousands of trucks and aircraft, complex information tracking systems and global networks of offices and warehouses. Here, when we discussing about running a businesses, there is always rival that competing in the market. Same goes to DHL. UPS, FedEx, and TNT are his rival in logistic service provider where all of them try to give the most efficient and fasters in moving goods throughout the world.

A part from rival, there are few factors that company like DHL need to look after in securing their profits. What are those factors? The find out more regarding the logistic service provider areas, let us go through the discussion in this case study.

Question 1: Describe the various service provided by logistics service providers. What is the role of these services in focal firms’ value chain activities?

The logistic service provider is a specialist that arranges for physical distribution and storage of products on behalf of focal firms, as well as controlling information between the point of origin and the point of consumption. They offer express services, international air and ocean freight, contract logistics and various value-added services. They also offer traditional distributor functions such as warehousing, inventory management and order tracking. For Red Wing and countless other international manufactures, they also use common carriers, companies that own the ships, trucks, airplanes and other transportation equipment they use to transport goods around the world.

Logistics is an integral part of any organization and an effective logistics system can ensure efficient achievement of business goals of the organization. Logistic service providers are facilitators which help the organization in an easy and economical manner. They help to provide a timely delivery of the raw material, semi-finished and finished goods, whether externally or internally, using different modes of transportation such as sea, land or air. The role of these services in focal firms’ value-chain activities is to provide cost-effective means of delivering cargo anywhere in the world. In the modern world environment, logistics is not only concerned with internal movement of goods within the premises, but also extends to logistical material movement and covers a vast area that includes inventory control, re-ordering the products and ensuring that the supplies are made at the right time and are in the right place.

Question 3:Factors in choosing logistics service provider

There are several factors to consider in choosing one logistics service provider over another. Traditional ways of competing are to offer the end-customer advantages related to product quality, the speed with which it is delivered, and/or the price at which it is offered. These three factors are some of the factors that have to be taken into consideration in choosing logistics service provider.

The first one is the quality advantage. Quality is the most visible aspect of supply chain performance....
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