The logistics outsourcing is continuously evolving as more companies are rediscovering the importance and significance of this management solution. Amidst all the changes that we are seeing the emergence of management jargon that is associated with logistics outsourcing. When we come to refer to Los Angeles contract warehouse, each may have their own understanding about the exact definition of such term. We may even ask ourselves the difference between order fulfillment and warehousing. Our proper understanding of these terms related to logistics outsourcing is very important in order for us to put across our needs and expectations. Problems will definitely crop up if we do not have a clear understanding of these commonly used terms.
A logical way to understand the framework of services that fall under logistics outsourcing is by looking at the major segments of the market targeted by each of these types of logistics services.
1.Los Angeles 3PL warehousing basically refers to the third party logistics provider specializing on warehousing. This is the appropriate term that should be used when you are looking for business solution that will address your storage, handling and transporting of company's products. You can attain effective control of these business functions by entering to a long term business arrangement with a contract warehouse. The 3PL company will be tasked to formulate a customized warehousing management and distribution system that will address the unique needs and requirements of your company. This kind of outsourcing agreement is sometimes referred to as 3PL contract warehousing. The main distinction of this type of logistics outsourcing is that it is done on a long term basis.
2.The order fulfillment is the outsourcing service that involves online processing of product orders and returns. The order fulfillment shall handle all related functions to complete the business cycle of order placement and product returns. In most cases, the client company will be a bit reserved in sharing complete information to the logistics service provider. The company can just go as far as divulging cost structure related to product storage, handling and transporting. Once the rates are finalized, the order fulfillment company shall make the necessary adjustments. Shared warehouse among companies with order fulfillment contracts is now a norm in the logistics outsourcing business.
As a general rule, the company serves only two major types of clients. These are the large client companies, and the small and medium client companies. The large companies who are looking to outsource their logistical requirements include manufacturers, large retail chain stores and wholesale distributors. These companies are seeking to outsource specific logistical requirements in order to rationalize the operations of the company. In most instances, these companies require 3PL warehousing service.
On the other hand, companies categorized as small and medium usually require the support framework for order fulfillment service deliver by a third party service provider. As we are witnessing the dynamic growth of the e-retailers, expect to see the growth of this e-solution in the near future. The generic term commonly used to refer to this outsourced logistics service is order fulfillment.
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