Logistics Companies Level the Playing Field for Business

The freight industry has seen many changes before 25 years with many companies now choosing to outsource their freight logistics to third-party logistics providers as opposed to handle their freight and warehousing needs in-house logistics company. Third-party logistics companies offer integrated or "bundled" services that can be customized to a client's needs to supply any or all of a company's supply chain management function. These services may include transportation, inventory management, storage, warehousing, cross-docking, order fulfillment, and freight forwarding allowing businesses to better concentrate on their core business.

Outsourcing logistics to a third-party logistics provider is practical in today's increasingly competitive marketplace in which companies need to become leaner, reducing costs and assets. Labor and associated costs are among the highest for a business, making outsourcing of freight management and employees very cost-efficient. Warehousing costs may be significantly reduced by outsourcing, reducing also asset liability. Efficiency of scale allows asset third-party logistics companies to supply competitive pricing for the tiny and medium-sized businesses on a competitive level with Fortune 500 companies.

Logistics companies provide the experience, expertise, and networks which are otherwise unavailable to numerous businesses with in-house logistics departments. Because they've relationships with transport carriers with whom they do a significant amount of repeat business, they have the ability to negotiate reduced freight costs than individual companies can typically warrant. Additional savings are possible by taking advantage of a centrally-located third-party logistics company in a major hub city with warehousing and order-fulfilling services. Outsourcing costly, extraneous tasks required to business but not really a part of the core business allows small and medium businesses compete and flourish in a global marketplace.