Question

What is the term used for a company moving management of the complete cycle of material flow to an outside provider?

Short answer

Logistics outsourcing.

Step-by-step solution

Logistics outsourcing

Logistics outsourcingis the process in which a company appoints some outside service providers to handle different types of supply chain operations. Logistics outsourcing consists of packing, storing, shipping, and delivering products of a company as well as several raw materials. 3Pls are used by companies which are of 4 types.

Business modules of 3 PL

a) Dedicated Contract Carriage

• Shipper supplying done with drivers, tractors as well as management of the fleet.
• The contract tenure is held from 1 to 7 years.
• Normally include trailers inside it.

b) Domestic Transportation Management (DTM)

• Provide value-added transportation which is non-asset-based
• Services are based on a contract basis.
• Services were taken in conjunction with paying brokerage on freight.

c) International Transportation Management (ITM)

• Services are based on a contract basis.
• Freight forwarding is done following services performed in conjunction.

d) Value-added warehousing and distribution

• Provide distribution center operations in long-term warehousing contracts.
• For value-added services hosts are are included.