3PL

Third Party Logistics commonly referred to as 3PL, is outsourcing of logistics services by a company to help in running the company’s business. The decision to outsource 3PL lies with the management of the company and it can be made in four stages (BAJEC & JAKOMIN, 2010). The first stage is the planning stage. This is the stage where the management assesses its risks and whether it needs the services of the 3PL. The management then appoints the project leader and the project team to see the process of outsourcing is successful.
Contrarily, if the planning stage is successful and the company decides to go through with it, the next stage is the evaluation stage. At this stage, the company determines how the services of 3PL will affect the company’s structure and strategies. It is also the stage where the company ensures that it doesn’t outsource its core competencies to 3PL as this might expose it to the risk of losing its competitive edge (BAJEC & JAKOMIN, 2010). Also during evaluation, the company should define the motive, scope, and objective of 3PL. This helps in ensuring that the 3PL serve the purpose in which it was outsourced. Otherwise, the outsourcing might find itself stuck with a project that is no impact or even additional unnecessary costs (Rouse, 2010).
Consequently, the next stage is the analysis stage. During this stage, the company analyzed costs and performances both current and future in the services of a 3PL (Intrieri, 2013). A good outsourcing decision should ensure the 3PL in the cost effective and performance efficient and that it does not cost the company more than it generates.

In conclusion, the final stage is selecting the perfect 3PL service provider (Intrieri, 2013). This is normally done by considering a number of 3PL providers such as their performance capability, the location of their warehouses, qualifications of 3PL, communication channels, and protocols, IT systems capabilities, compliances, costs, etc. (Rouse, 2010). After being satisfied with the above stages and information, the manager can then proceed to sign a contract with the 3PL of their choice.
References
BIBLIOGRAPHY BAJEC, P., & JAKOMIN, I. (2010). A MAKE-OR-BUY DECISION PROCESS FOR OUTSOURCING. In Promet, Traffic&Transportation (pp. 285-291). University of Ljubljana.
Intrieri, C. (2013). Third Party Logistics Companies: A Checklist When Evaluating Which 3PLs are Best for YOUR Needs.
Retrieved from: http://cerasis.com/2013/08/05/third-party-logistics-companies/
Rouse, M. (2010). 3PL (third-party logistics) .
Retrieved from: http://searchmanufacturingerp.techtarget.com/definition/3PL