The Responsibilities of Logistics Service Providers

by | Nov 11, 2014 | Logistics‎

A logistics service provider is responsible for the process of outsourcing the flow of merchandise to a third party. In other words, a business hires another company to manage warehousing, inventory management, order processing, packing, and shipping. The benefits gained from outsourcing logistics outweigh the costs. In fact, the costs are minimal and usually only equate to a small percentage of each sale. A logistics service provider manages the end-to-end process of order processing.

Warehousing. Warehousing stores large stock of merchandise meant for sale. This service is beneficial for businesses that have outgrown home based operations. Warehouses are kept clean, secure, and climate controlled. All products are organized in a way that supports the storage plan for quick retrieval.

Inventory Management. Managing inventory is important to keeping customers happy. When customers place an order, they expect the order to arrive in a matter of days, with some exceptions. With a solid inventory management system, businesses never have to worry about a product order that is not in stock. A logistics service provider maintains the inventory records, so there are no mistakes affecting customer orders. Outsourcing also creates reports for tracking inventory levels. Inventory reports are accessible 24 hours a day from any location.

Order Processing. Logistics service providers allow businesses to focus on the goal of making more money. Allowing a third party to handle order fulfillment allows the business owner to focus on generating more leads, marketing to new customers, and research of new products. Processing orders is probably not what the owner wants to concentrate on, and this disinterest may leave more room for mistakes. In this way, more time is spent on the strengths of the business.

Packing. Packing merchandise is a form of art. Merchandise should be cushioned in its shipping container so it is free from vibration and shock. This is important so the business owner is not wasting money replacing items that are damaged. Additionally, customers are dissatisfied when they received a damaged shipment. A logistics service provider will know how to consider the weight and center of gravity when positioning the merchandise. Also, there is the use of a packing station so all of the packing materials are already available once the order is pulled.

Shipping. Same day shipping is a service all consumers seek when shopping online. Consumers what a seamless process similar to shopping in a traditional brick-and-mortar store. On the other hand, when using a third party for shipping, the hiring firm wants shipping that is fast and cost effective. A logistics service provider’s job is to ensure the satisfaction of both parties.

With a logistics service provider, all of the shipping needs are covered. The end-to-end order fulfillment process is smooth and reliable. The clients feel confident in not overseeing the fulfillment process.

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