THIRD PARTY LOGISTICS
AG Cargo Forwarders also provide outsourced (or “third party”) logistics services for part of, or all of its supply chain management functions. We typically specialize in integrated operations that include warehousing, transportation , and light assembly services. These services can be scaled and customized to customers’ needs based on market conditions. Often, these services go beyond logistics and include value-added services related to the production or procurement of goods.
There are many advantages to engaging with AG Cargo Forwarders. These include;
- Cost and time savings–
AG Cargo Forwarders meet the technical and equipment requirements in a faster and more cost efficient way than a manufacturer or distributor could do for itself. As logistics is the core competency of third party logistics providers they possess better know how and a greater expertise in providing supply chain solutions to their customers.
- Low capital commitment–
When contracting with a 3PL it is no longer necessary for the client to own its own warehouse facilities or transportation assets. This lowers the amount of capital required for the client’s business. This is particularly beneficial if a company has high variations in warehouse capacity utilization, because a bad capacity utilization ratio at equal fixed cost (for warehouse) will reduce a company’s profitability.
- Focus–
The outsourcing of logistics departments permits the company to focus even more on their core business. Manufacturers and distributors want to remain as competitive as possible.
- Flexibility–
the 3PL customer gets to utilize more flexible resources in labor, space and equipment. Essentially fixed costs are reduced and turned into variable costs.
