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Why E Commerce Companies Need to Invest More in Reverse Logistics

What is reverse logistics?

Reverse logistics in ecommerce refers to the return process involved wherein the goods are moved from their point of consumption back to their point of origin. Two key reasons for using reverse logistics in e commerce could be either for disposal or for recapturing value. Making the purchase as well as the return process easy and hassle-free plays an integral part in ensuring customer satisfaction. This consequently results in repeat purchases and loyal customers. To ensure this, several companies are now even hiring third-parties to handle their reverse logistics processes.

Benefits of reverse logistics in e commerce

When it comes to an e commerce business, placing the order is one part of the customer’s encounter with the company and order fulfillment is the other. Online shoppers often don’t shy away from returning products that don’t meet their expectations and making them jump through hoops in order to get their money back on a dissatisfying sale is a great way for e commerce companies to lose their business forever. Here are some of the key benefits of reverse logistics in e commerce:Contact US

Customer retention

In the modern world, having a functional and efficient logistics system is imperative to thrive in the e commerce market. A major drawback of e commerce business is the lack of tangibility of products, and customers often tend to bank on the pictures/videos displayed on the e commerce site. Once the product reaches the customer it might not match the customer’s expectations. One of the key benefits of reverse logistics is that customers would choose the company that offers them the safety net of being able to return products without too much of a fuss.

2018: New Year, New Trends – Where is the Transportation Industry Heading?

Today, the importance of transportation is far greater than getting people and goods from point A to point B. Advancements in technologies have enabled the logistics and transportation industry to improve the quality of their services. Global businesses and international trade rely highly on the transportation services to move the flow of goods within the economy. Virtually everything around us from the clothes we wear to the device we use is sourced from multiple locations across the world. As every component has to be transported to different players across the supply chain, the overall cost keeps on increasing due to shipping charges and other value-added activities. As a result, the transportation industry is constantly on the lookout for ways to contain this cost. So what are the top trends in the highly competitive transportation industry for 2018?


Self-driving trucksSE_Demo2

Last year, the hype was all about self-driving cars and its ability to seamlessly drive around cities without any mishaps or accidents. This year though, the concept has evolved to bigger vehicles – self-driving trucks. A combination of AI and myriad sensors can correctly evaluate road conditions and learn how drivers behave under specific conditions. Additionally, vehicle-to-vehicle (V2V) communication systems can share learned information and improve the AI driving pattern. As a result, such self-driving trucks can potentially become better drivers than human themselves. Tesla recently announced Tesla Semi an all-electric truck with Tesla Autopilot, which allows semi-autonomous driving on highways.

Blockchain in logistics

One of the major problems faced by the transportation industry is the difficulty to effectively look at performance history and trace the flow of goods. Blockchain’s ability to provide security and transparency efficiently solves this complication as a logistics company can quickly recall the product back to its origin in case any damage is there. Additionally, if a potential customer wants to buy a used car, he may not have any information in the previous condition of the vehicle. However, with blockchain, all parties involved in the transaction can have a clear view of the past records. Another interesting use case of this technology can be to estimate the cargo space for specific shipping orders. The data can be used to calculate the shipping costs, after which automatic contracts can be executed when certain conditions are met and consequently stored into the blockchain network.

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Benefits of Warehouse Management System

A modern-day warehouse has to deal with large volumes of goods flowing in and out of it. The warehouse also has to manage recording item details, where it is stored, where it is to be sent among others. Manual systems may not be able to cope with such large volumes of data which has to be processed and retrieved instantaneously. This is where a proper warehouse management system (WMS) can contribute to increasing the efficiency of warehouse and in turn contribute to the company’s supply chain. A warehouse management system can be a standalone application or a part of an ERP system which enables centralized management of tasks SE_Demo2regarding inventory tracking and processing. Numerous have elevated the capabilities of warehouse management system to perform data-intensive tasks and incorporate RFID and voice recognition technology to enable automation.

Benefits of warehouse management systems

Space savings

Reducing the amount of clutter and properly organizing stocks can lead to savings in warehouse space. A warehouse management system allows the warehouses to properly organize the goods in such a manner that they take up less space. Enabling accurate stocking, slotting, and pulling of orders gives in-depth insights to companies in how much stock is needed so that they can procure only the required amount and avoid overstocking.

Reduces equipment wear and tear

Warehouses are filled with stocking and moving equipment including trucks, pallet jacks, forklifts, and carts. The more these equipment are used in a single day; the more vulnerable they are to wear and tear decreasing the life expectancy of the equipment. Increasing the machine idle time will ensure that the machines last longer. So, a warehouse management system can increase the machine idle time by eliminating the need to stock, pick and reset unnecessarily. They do so by reducing redundant picking routes, managing inventory optimally, and decreasing the per-equipment cost of shipping.

Reduces security vulnerabilities

Security is of the utmost importance in a warehouse. There might be instances of pilferage and theft within the warehouse by employees, which can be easily manipulated by changing stock numbers in a record keeping system. An effective warehouse management system will keep up-to-date records of inventory and provide authorized access to specific users. Instances of tampering can be easily identified with user-specific logins. Furthermore, automated systems like RFID can effectively eliminate such activities by keeping real-time information on inventory levels.

Increases customer satisfaction

A proper warehouse management system keeps accurate track of inventory levels and reduces errors in order fulfillment process. Eliminating such errors means that wrong deliveries are avoided, which would result in dissatisfied customer and increased costs in terms of reverse logistics. It results in goods getting delivered in proper condition to the correct customer each time, which increases the customer satisfaction levels and decreases the number of customer complaints.

Boosts workforce productivity

A typical warehouse is a very busy place with workers hustling and bustling to receive, stock, and dispatch items. A typical worker would have to move around a lot making multiple trips to the same place and also making additional trips to rectify errors. A warehouse management system reduces such errors and ensures optimal stocking so that workers would have to move around less within a warehouse. Additionally, it also reduces overexertion and allows workers to pick up more items in less time thereby increasing efficiency in order fulfillment. This may also result in the organization needing lesser workforce due to higher productivity gains saving them in labor costs.

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Impact of Autonomous Vehicles in the Logistics Industry

Numerous technologies have evolved in the recent times that look to radically alter the working of the logistics and supply chain industry. From 3D printers, workplace automation, and AI to big data all look like a promising tool to substantially increase efficiency and save costs. Autonomous vehicles or self-driving cars are amongst the latest technological innovation that seems set to impact the field of logistics widely. Sophisticated computer navigation, GPS technology, camera technology, and sensor technology together hasSE_Demo2 made it possible for vehicles to be driven without human intervention. Apart from the automobile companies, technology giants like Google and Apple have also invested heavily in this technology. So how exactly will autonomous vehicle impact the logistics industry:

Improved Safety

Although earlier in the year Google’s autonomous car crashed in Mountain View, people began to jump to the conclusion that using such technology in the logistics industry is unsafe. But people fail to address the success rate where it had already driven more than 1.4 million miles without a single incident. For comparison, the accident rate for cars driven by humans stands almost at two crashes per million miles. By eliminating driver related errors, autonomous cars significantly improve vehicle safety and ensure that the goods reach the destination safely.

Increased Efficiency

Self-driving cars are highly efficient and can make a split-second decision which humans cant possibly perform. With a little assistance from AI technology, an autonomous vehicle can crunch mountains of data to come to a decision, that too in a matter of a fraction of seconds. The autonomous vehicle can efficiently identify best travel routes to minimise time on-road, avoid traffic jams by following lanes rules, and drive at optimum speed and employ platooning to maximize fuel economy. Considering the savings in fuel and quicker delivery times, autonomous vehicles can vastly improve the performance of logistics companies.

Cost Savings

It is already evident that with advanced decision-making capabilities autonomous vehicles can save fuel and time costs. Additionally, improved safety will also avoid damage costs as well as insurance costs. As a result, insurance companies would be willing to accept a low premium amount for autonomous cars in the future due to their low error rate. Also, logistics companies will also save on personnel costs which is currently a significant part of the transportation costs.

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4 Little Changes to Obtain Big Savings in Shipping Cost

Companies can get competitive in terms of cost at a product level but face challenges maintaining the prices when shipping costs are taken into consideration. It is one of the biggest expenses for numerous small businesses. Depending on the nature of business and contract negotiation, shipping cost is either borne by the buyers or sellers. Regardless, since it accounts for a significant percentageSE_Demo2 of the product cost, companies are looking for measures to reduce and realize savings on the shipping costs. Here are some of the ways to trim the shipping costs to remain competitive in the marketplace:

Negotiation with Multiple Carriers

All shipping companies have pricing schedule based on volume, product type, and distance. It would be unwise to explore rates of multiple shippers constantly. Shipping needs of businesses may change over time and so may the pricing. Another place where small businesses can save money is while negotiating shipping volumes. Although service providers may affix a fixed rate for volume shipping, businesses can negotiate to lower the shipping rates for a fixed volume.

Reduce Shipping Errors

Majority of the money spent on the shipping cost of wasted in correcting shipping orders delivered to the incorrect location. Such errors not only increase the shipping cost but also increase the overall shipping time thereby reducing customer satisfaction and repeat business. Since small businesses may not be able to afford real-time wireless warehouse management system and bar-coding solution, it is necessary to double check all shipments against the original order to make sure the address is validated.

Using Packaging Provided by the Carrier

Proper packaging is essential to ensure that shipments reach the destination safely and intact. To ensure safety and for branding purpose, companies might want to use their own packaging which can incur an additional dimensional fee if the size exceeds regulations set by individual carriers. Additionally, companies can make simple packing mistakes such as using the wrong-sized box, using weak or compromised box, use wrong packing material, or poor taping job. Using packaging provided by carriers not only eliminates the extra-dimensional fees but also ensures that packaging job is proper. Companies can save as much as 10%-20% of the shipping cost this way.

Consider Hybrid Services

Many carriers are now offering hybrid services like FedEx SmartPost and UPS SurePost which can cost half as much as standard delivery options. Such services reduce the transit time, minimizes handling and maximizes cost savings. These services reduce the delivery cost by collecting packages from you and shipping them to the post office that is closest to the destination. The post offices then use local mailman to make the final delivery. Although it can lead to substantial cost savings, it can slow down the delivery time.

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Optimizing Material Handling to Maximize Warehouse Efficiency

Companies usually invest considerable sums in setting up massive warehouses. As a result, warehouse spaces are costly, and companies can incur huge costs regarding carrying, handling, and storing within a warehouse. Companies are constantly figuring out ways to optimize warehousing operations to increase cost savings. With the advent of technology, automation, and data analytics, SE_Demo2companies have a variety of options to streamline the material handling process to utilize the warehouse space effectively. So how can companies effectively increase cost-savings by effective material handling to optimize warehousing space?

Accurate Forecasts and Inventory Management

Accurate forecasting is critical to a successful inventory management. Even a small percentage difference in forecasting can result in excess inventory, which takes up additional warehouse space and freezes up the inventory capital. Its high time for companies to abolish the traditional spreadsheet-based forecasts and opt for sophisticated solutions, which account for multiple factors for forecasting. The current ERP solutions take in historical data, seasonal trends, promotional activities that are processed by algorithms to generate a more accurate forecast. A precise forecast figure assists the company to hold just the right amount of stock increasing customer service levels and minimizing stockouts.

Maximize Space Efficiency and Layout Design

The most obvious way to increase warehouse storage space would be to expand horizontally by adding more square footage. In recent times, as land becomes a scarce resource, storage facilities are looking to increase the holding capacity per square footage by expanding vertically. Designing an efficient warehouse layout with right industrial storage systems can ensure maximum carrying capacity and thereby improve operational efficiency. Additionally, by analyzing the materials that need to be stored and the material flow, efficient layouts can be created to minimize travel time, ease inventory tracking, and minimize the chance of losing the small items.

AS/RS Warehouse Storage Solutions

An automated storage and retrieval system (AS/RS) can maximize warehouse space by storing large volumes of material in a small footprint and help eliminate errors. These solutions can drastically reduce the travel time in the warehouse, which results in optimized operational performance. A modern-day warehouse execution system (WES) can encompass warehouse management functionality, material handling equipment (MHE) control, warehouse control system functionality, business intelligence and integration with host ERP systems.

Advanced Warehouse Material Handling Equipment

Companies looking to improve their warehouse productivity should look to adopt advanced warehouse material handling equipment as it results in better productivity and improve safety.  When purchasing such equipment companies should analyze the suitable loads that will be carried with considerations for margin of safety. Other factors to consider in the purchase process includes the width of aisles, turn spaces, vehicle features, and turning radius.

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Top 5 Logistics Companies Across the World

Logistics is a critical part of any company’s supply chain as it ensures optimal flow of things between the point of origin and the point of consumption. The term logistics encompass not only the physical items like materials, equipment, and vehicles but also abstract terms such as time and information. Businesses usually manage their own logistics or outsource it to third-party logistics service providers (3PL) for their needs. Logistics companies depict expertise in material handling, integrating information flow, inventory management, packaging, warehousing, production, and security. Most logistics companies handle various aspects of logistics including inbound logistics, outbound logistics, procurement logistics, distribution logistics, disposal logistics, reverse logistics, greenSE_Demo2 logistics, emergency logistics, and digital logistics. Since logistics is such a vital function for every business, who are the top logistics companies in the world?

Top Logistics Companies in the World

DHL Logistics

Today, DHL has become a household name when it comes to logistics services. DHL serves both individuals and business customers with solutions which includes warehousing and distribution, customs, insurance, supply chain solutions, freight transportation, and industry sector solutions. With its vision as “The Logistics company for the World,” DHL employs 325,000 people across three significant regions namely the Americas, Asia Pacific, and Europe. People trust DHL across the world to send urgent documents or goods reliably in a very short time. The company is now focused on developing green solutions by providing Green Express Shipment, Green Mail, and Parcel Shipments. In the fiscal year of 2016, the company reported worldwide revenues of 57 billion euros.

UPS Supply Chain Solutions

UPS Supply Chain Solutions is an American messenger company started by James Casey in 1907. Initially, it started out by delivering packages, but now it offers services including contract logistics, consulting services, industry solutions, transport and freight, and customs brokerage. The company offers its services to industries such as healthcare, industrial manufacturing, aerospace and defense, automotive, customer services, professional services, and hi-tech. They believe in the importance of business sustainability and thus have increased their efforts to help small start-ups and e-commerce business by taking care of their supply chain. The company has grown significantly with numerous merger activities which include Haulfast, Menlo Worldwide, Carryfast, and Parcel Pro.


FedEx is the company giving serious challenge to the market leader DHL operating with a fleet of 325,000 employees across the world. Their service range includes post-delivery, express mail, third-party logistics, and freight forwarding. The company is known for shipping packages overnight and inventing real-time package tracking system which can find lost packages as well. In order to expand its global operations, the company has undergone mergers and acquisitions with companies such as GENCO, Bongo International, Supaswift, Opek Sp.z o.o., TATEX, and Rapidão Cometa. As a part of sustainability measures, FedEx has installed solar panel fields at certain facilities to reduce carbon radiations and also built all-electric trucks under their EarthSmart initiative.

SNCF (Société Nationale des Chemins de fer Français)

The SNCF Group is France’s state-owned railway company that employs 180,000 people across the world. The company provides full range mobility solutions including Proximities, SNCF Infra, Logistics, Voyages, and Connexions. Its logistics division formerly operated under the name SNCF Geodis. It is amongst the top transport and logistics companies in France and fourth overall in Europe. The company has accumulated expertise in road transport, supply chain optimization, freight forwarding, distribution, contract logistics, and express delivery over the years. The company has transports 3 million vehicles every year with 3200 trucks and wagons in their STVA fleet.

Kuehne + Nagel

Kuehne + Nagel was started by August Kühne and Friedrich Nagel in 1890 in Bremen, Germany. The company is currently headquartered in Switzerland and provides supply chain solutions to industries like aerospace, FMCG, hotels, marine, and forests. Their product and services portfolio include airfreight, sea freight, over-land, contract logistics, and integrated logistics. The company is also considered one of the best sea freight forwarder in the world achieving double-digit growth year on year. The company also earned Global Cargo 2000 Phase 2 certification for their cargo forwarding works. Apart from sea freight forwarding the company is also a close market leader in contract logistics and lead logistics.

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Category Management Solution Helps a Leading 3PL Provider Drive Business Performance

Category Overview

Over the past few years, the global demand for product shipment has been overtaking the supply, and leading logistics providers are optimizing their supply chain to improve transportation capacities. Also, transportation plays an essential role in sustaining the growth of the economy. As a result, 3PL companies want to reduce capital expenditure, manage inventory, and mitigate supplier-related risks. Category management solutions allow clients in the 3PL space to improve cost structures, efficiency, and effectiveness of business relationships. request free proposalAdditionally, these solutions also help players in the 3PL space to improve their supply chain competence and streamline supply operations.

With over 13 years of proficiency in offering category management solutions, SpendEdge helps companies operating in the 3PL space to build better partnerships with customers and drive business performance across business units.

The Procurement Pain Point and Insights Offered

The client, a leading player in the 3PL space with business units spread across diverse locations, was facing predicaments in building the skills of category and customer teams across the industry space to enhance category partnerships with customers and drive business performance. The client also wanted to align client brands with the category drivers and vision, to enable the brands to drive category growth.

SpendEdge tailored a comprehensive research to cater to the requirements of the client. This approach involved primary and secondary research coupled with quantitative and qualitative data collection procedures.

During the course of this category management engagement, the 3PL client developed a comprehensive toolkit, including driver selection, market assessments, and customer presentations. The toolkit was then implemented across markets through regional workshops to enable local markets. Additionally, the client gained actionable insights into tactical initiatives, category drivers, and guidelines that covered all market types and channels.

Fundamental questions answered in this category management study include

Business Outcome

The category management solution from SpendEdge helped establish the client’s leadership position across markets. Additionally, the client made immediate gains for the category and the brands of the client with the change in behavior and approach in managing the category with customers.

To know more about our category management solutions for 3PL providers

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