Please answer original forum with a minimum of 250 words and respond to both students separately with a minimum of 100 each with References
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page 1 Original Forum with References
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What are the benefits and limitations of: third party logistics providers (3PLs); water transportation, and pipelines?
With the growing demand on E-commerce services, it is inevitable that the transport of the manufacturer’s products will also become more difficult. There are several strategies one can use in order to fully put their products in the clients’ hands. Examples of which are third party logistics providers (3PLs), water transportation, and pipelines.
One obvious advantage of 3PLs is its flexibility and convenience (Nielsen, 2013). Investing on warehouse leasing and hiring staff can be a huge cost especially when the business is still new. However, with the use of 3PLs services, you can just pay what you hired them for whenever you need to distribute your products in the market. Secondly, the complex transportation of goods will be shouldered by the 3PLs which will become easier for the company (Scolari, 2018). The rules and regulations are constantly fluctuating especially in the international waters. With their expertise on the product distribution, they will undeniably be successful with the in and outs of all the requirements needed to distribute the manufacturer’s items. Last but not the least, is that they can give better transport rates or discounts. When a big third-party logistics provider also delivers together with other companies’ products, then it will become cheaper since all companies buying the service can divide the cost of the one-time transportation instead of paying for individual trips. These are just some of the advantages of utilizing 3PLs services However, there can be limitations as well such as losing direct control on the distribution techniques (Nielsen, 2013). You must trust them completely because your company’s reputation relies greatly in their hands. Any delays, miscommunication, and errors by the provider can have a huge impact to your company. On the other hand, cost can also be a burden in the long run (Scolari, 2018). If you’re constantly transporting goods, then it is better to invest in your own warehouse leasing and hiring staff especially when you are in the business for so long. With that, you can now directly control any kind of situation as well as saving cost from hiring third party logistics providers. 3PLs can only be good when you’re still in an early part of the business and you don’t have any budget yet to invest on your own logistics team.
On the other hand, opting water transportation or the use of pipelines are related to each other. One advantage of using water transportation is its low maintenance compared to land. However, there comes a risk in frequently using that method such as in calamities or pirate attacks. There are a lot of factors to consider too like the distance between the transfers because if it’s just short, a company can choose land or even pipeline transport compared to frequent ship travels. Advantage of pipeline transport is its efficiency since it can constantly transport oil or any other liquid to the market at any time (Robson, 2013). However, the upfront cost can be a huge limitation since a big budget is required to build that system but investing in pipeline method would be good in the long run.
Nielsen, T. (2013, November 8). The pros and cons of third-party logistics providers. Retrieved from http://www.nielsenconsulting.com.au/the-pros-and-cons-of-third-party-logistics-providers/
Robson, J. (2013, July 12). Pipelines and trains ? each have advantages and drawbacks. Retrieved from https://torontosun.com/2013/07/12/pipelines-and-trains–each-have-advantages-and-drawbacks/wcm/a9913066-8fe1-4e99-a1de-7283e0cf67f2
Scolari, E. (2018, May 1). Third Party Logistics: Pros & Cons. Retrieved from https://www.handshake.com/blog/third-party-logistics
Water transport and pipelines are two modes of transportation that are commonly overlooked in by the public eye. However, these two modes play a much more important role than appearances may suggest. Water transport is highly cost effective and its impact on the environment per ton-mile is significantly less damaging than motor or air alternatives. When it comes to global trade, the carrying capacity of ocean-going vessels is far superior to air transport, and it is the only mode which makes overseas trade in high-volume products economically viable. However, water transport is by definition limited to water, and only that water with enough depth to support vessels of a given draft. Slow delivery is also characteristic of maritime trade.
Pipelines as well require unique considerations. For those users connected to a pipeline, access is immediately available and complex ordering processes are obviated. In addition, most pipelines exist below-surface and therefore provide low loss and damage rates, while the volume provided by the pipeline itself serves as an out-of-the-way warehouse for the product in transit (Coyle, Novack, & Gibson, 2016). Yet pipelines also come with significant limitations. Product is naturally limited to those that can flow in liquid or gaseous states, and initial investment is high for a mode that is relatively inflexible once installed and limited in product type.
The advantages and disadvantages of third party logistics providers must be broken down between two sub-categories: asset-based and non-asset based providers. Asset-based providers have on hand and readily available transportation and logistics apparatus that can service customer needs directly and provide streamlined in-transit visibility for orders, while a common drawback would be the tendency of these providers to favor their own assets over more efficient options (Coyle et al, 2016). Conversely, non-asset based providers are attractive to customers because they excel at coordinating the most optimal transportation services, but generally lack the ability to provide direct and simplified services (Coyle et al, 2016). For third party logistics providers to be most effective, they should seek as much as possible to provide the positive features of both types.
Coyle, J., Novack, R., & Gibson, B. (2016). Transportation: A global supply chain perspective. Boston, MA.: Cengage Learning.
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