Executive Summary of Logistics and Supply Chain Management in A 3PL Service Provider

Table of Contents

Introduction of Logistics and Supply Chain Management in A 3PL Service Provider

3PL and TPL is third party Logistics and the supply chain management in a company uses different types of elements required for the fulfillment of services and distribution of the company. The logistics can be referred to the activities that works in the boundaries of DHL and can be referred to the network of supply chain of the company. In the network of supply chain management the companies work together and co-ordinate to each other for the proper delivery of product in the market. The e-business is the effective supply chain management. The proper supply chain management is required improve the ability of Management and to increase the customer relationship. The effective supply chain management deliver the product to the users. In the present era, the supply chain management is emerging as an innovative instrument that plays critical role in the e-business [1].

The above mentioned conditions a particularly related to the high competitive pressure, high customer turnover, and low margins. The increasing efficiency in the supply chain management process required proper support for the complex challenges faced in different number of processes. The complexity in the supply chain management can be reduced through the availability, implementation of new technology, and by increasing the capability of business. The type of DHL and 3pls are intermediary. In case of third party logistics services the essential components are co-ordinate careers, service suppliers, and logistic intermediary firms. The present research considered operation of 3PL in the DHL. The prime objective of the present paper is to analyses the logistics intermediaries, to identify the function and classification, and to facilitate the business with the operations. The whole process indicates the benefits of the business along with similarities and differences [2].

Supply Chain Management in A 3PL Service Provider

The DHL supply chain is incorporated in Bonn, and Germany is the part of DHL Global headquarters. Post Tower is the main building of supply chain of DHL that is located in the former headquarter of government. The post Tower is composed of glass and the design is modern architecture. The height of the tower is 162 meters (531.5 feet), width of Tower is 41 meters (134.5 feet), and length of Tower is 82 meters (269 feet). The world known famous companies are connected to the supply chains and fragmented values is required for the support of customer values in the supply chain. The overall inefficiency of the supply chain is due to the inadequacy and errors. Most of the products in supply chains are greater than the needs of inventory and are required to provide competitive services. The process of cycle contains stop and start processes. The inadequacy in the planning and information induces negative impact on the streamline flow of services and goods. The proper supply chain management is focus on the integrated processes gearing processes and aligning processes. Maximum overall efficiency can be increased through proper management. The whole business depends upon the reliability of the suppliers and services of the companies as according to the requirements of customers [3].

3PL Service Provider Company of Logistics and Supply Chain Management in A 3PL Service Provider

The successful business of the companies is associated with the trade activities at the international and the national levels. The logistic play an important role in the achievement of competitive advantages of business. The whole business is involved in selling and buying the products at international level [4]. The middleman are the service providers who sells and buys products, engagement performance for certain activities, warehouse services, and in consolidation services. The other processes are deconsolidation, consolidation, packing, custom clearance, tracking of information, payment services, contracting carriers, and forwarding of the services. The 3PLs performs the similar duties as the freight forwarders. There is no specified limit on the services of the 3PLs [4]. The shipment and delivery process are important for selling and buying the services. The qualified manager plays vital role for the development of logistics in the company. The business entities and business processes play an important role in the international trade. The logistic intermediaries are of different types and different names and the goal of the services facilitate the consumers. The logistics includes transportation, shipment, storage, and distribution of goods in the customers at reduced amount of services [5].

DHL Express of Logistics and Supply Chain Management in A 3PL Service Provider

The Supply Chain of DHL is mainly a component of Deutsche Post DHL and it is associated with the DHL Express. Headquarter of DHL is in Bonn and approximately 510,000 employees are providing their services at Deutsche Post. The Supply Chain management in the business is considered here, the solution provided by DHL are complex for the supply chain management. Back in 2016, the supply chain of DHL was competitive in certain aspects of strategies such as life sciences and Healthcare and in the technology sectors in automotive markets. Different types of shifts in the automotive sector the lead Logistic provider are observed in different countries including Mexico India China and other countries. The main product of manufacturers are parts of vehicle. The DHL supply chain in the markets of USA and Canada have been improved through 2016. The revenues of supply chain division in 2016 were decreased from 11.6% to the $14 billions. At the same time in 2015, the operating factors improved for 27.4% and the values reached at $572 million.

In the history of 3pl supply chain the main focus was single and shorter logistic services.  These services include transportation, warehousing and building of the transactions.  In order to become more successful in the business, new strategies are required to develop the skills and competencies in the services. In the recent conditions 3pls are getting more attention for the generation of long-term contractor relations of the companies with the customers for providing the services. The significant impact of 3pl was studied by past, present, and future concerns [4].

Application and Analysis of Concepts, Tools and Techniques

The proper investigation of DHL supply chain can be helpful for the identification of weakness and strength of business. The Other concerns can be resilience and sustainability. In the supply chain there are different concerns such as logistical and cross functional drivers. [3].

Facilities of Logistics and Supply Chain Management in A 3PL Service Provider

Application: The global headquarter of DHL Express's is a component of the Deutsche Post headquarters located in the Bonn. The American Headquarters are situated in Plantation, Florida, USA, while the other headquarters are located in Asia-Pacific and are becoming emerging markets. Besides headquarter in US, there are other headquarters located in Singapore, China, Malaysia, and Hong Kong. The European hub is DHL is in Leipzig, Germany.

Sometimes the DHL Express' business is incorporated as DHL International GmbH. The business faces different competitive advantage and in the competitors includes FedEx, national UPS, and national. In the present case, most of the post carriers are Royal Mail and United States Postal Service (USPS). While on the other hand the minor partnership of DHL is with the USPS. This partnership allows DHL to deliver maximum services of the small packages. The delivery is provided to the recipient and the network used in the services is USPS network that is often known as DHL Global Mail, and presently it is known as DHL ecommerce. The USPS mails are delivered to the Iraq and Afghanistan [1].

The owner of DHL are German and the services are not affected by any country such as USA, Cuba, and North Korea. There are stick orders what the delivery of services in the North Korea as a company has City relation with the west. DHL is not an American domestic company but it provides domestic flights between the airports. The contract of services in the DHL are to provide the facilities to other customers regardless of their Nation and country.

Challenge: the DHL services faces challenges such a disaster and descriptions.  The example of disaster is Tianjin port explosion.  In the disaster approximately 5800 DHL parcel were destroyed and the damage caused reached $317 m.  Besides this the other challenges are associated with the manufacturing capacity of the company related to the demand, market competition, and innovation in the product.

Inventory of Logistics and Supply Chain Management in A 3PL Service Provider

Application: lean production is used by DHL and the major advantage is good to order system, time principles and minimization of cost inventory, responsiveness, and short time requirement for the production.  DHL system user different stages related to the responsive pressure services and suppliers.  The prime focus of the services is the efficiency of delivery.  The apparent INVT was made as 5.48 that is higher than BMW. The return of inventory is 9.49 for each week. In DHL the process involved cash to cash cycle which indicates the collection of money in DHL from first week to the ninth week. The services are provided to the suppliers for development and Research purposes.  The decrease in the inventory level defines thar landfill reduces with the development of DHL.  The   sustainable growth strategy is obtained by DHL in the whole process. [2].

Challenge: regardless of the environmental factors and cost saving services the development in the supply chain management why required.

Transportation of Logistics and Supply Chain Management in A 3PL Service Provider

There are five Deutsche Post owned by the subsidiaries operating for DHL Express. The transportation system of DHL consists of 21 aircraft on orders and 96 operating aircrafts. The DHL aviation system is equal to world sixth airline system that operates for the transportation purpose.

DHL Aero Expreso, Panama City, The Panama makes it possible for the services to reach the destinations in South and central America

AeroLogic, Schkeuditz, Germany delivers the services for Europe to central as well as the eastern Asian destinations. The services are from Frankfurt Airport and Leipzig/Halle Airport.

Blue Dart Aviation, Chennai, India, serves for Indian destinations by using the Chennai International Airport

DHL Air UK, Hounslow, United Kingdom gives services to different European destinations including the East Midlands Airport.

SNAS/DHL, Bahrain. These services are provided from certain locations of Middle East destinations that begins from the Bahrain International Airport

European Air Transport, Leipzig, the Germany delivers the services in the European destinations. These services are from Halle Airport

Challenge: The above mentioned advantages are provided by the outsourcing as well as the inbound logistics associated with the DHL. The whole process makes DHL a vulnerable source for the delivery of services in the different combinations of the supply chain resilience, for instance the affection of workers strike that was few years ago [3].

Sourcing of Logistics and Supply Chain Management in A 3PL Service Provider

Application: The services of the DHL are based on the different processes such as sourcing of the raw materials for the suppliers, parts and components of the delivery processes; at the same time the strategic suppliers achieve certification of the accredited third-party. The ability of the company is to accommodate the needs of the customers and to facilitate the DHL suppliers. The aim of services are to reach the maximum sustainability through supply chain. The outsourcing process provides help in the companies to decrease the cost and to improve the business. The process helps the companies for the improvement of companies. The factors affecting the supply chain are sustainability, efficiency, and the responsiveness [6].       

Challenge: The process of outsourcing is a challenging issue for DHL supply chain. Consider that the DHL suffers from any kind of supplier’s bankrupt in 2001; Therefore the company is facing issues of not well-prepared, and the focus is diverted to pay off some of its debt [7].

Information of Logistics and Supply Chain Management in A 3PL Service Provider

Application: DHL uses the process of the sharing information and apply collaboration with the suppliers that helps the company to ensure long-term goals. The whole process can reduce the emissions of carbon footprint. The valuable consideration is the helps of supplier and service providers to improve the whole system of supply chain by using different processes. the increase in the responsiveness as well as decrease in the cost. The process provides information about sharing in push/pull process [8].

Challenge: The Company faces challenge of sharing the valuable information with each other particularly in the absence of any standards required for measurement. The challenges increases the sustainability and reduces the issues of the supply chain management in the company [9].

Pricing of Logistics and Supply Chain Management in A 3PL Service Provider

Application: Pricing is a controlling and significant factor that induces impact on the levels of demand along with responsiveness. The sustainability of supply chain sustainability works to improve the business by imposing conditions for reducing cost. The customer gets more choices for the sustainable growth of supply chain [10].

Challenge: The culture and the willingness of the suppliers and the customers induces impact on the production level of products and services. The whole process is sustainable for the supply chain and the only issue and biggest challenges is the sustainability.

The DHL company is working efficiently and provides greater values to the environmental sustainability and the social norms of the company. The company was provided by award in 2015 and the award was "Queen’s Award for Enterprise in Sustainable Development"  and in the following year of 2013 the company was awarded by  "BITC Responsible Business of the Year Award". Then in the 2014 DHL in UK generated higher services and around 3,500 jobs of skilled manufactures were provided to the new job finders. The 3500 employees were from the whole world and top 5 best employees were selected for award. The dynamic relations of DHL are with the different universities and the colleges. The University London is one of the collaborative project related relation of DHL. The manufacturing and recruitment of sustainable environment was necessary.   

Recommendations of Logistics and Supply Chain Management in A 3PL Service Provider

Creating Supply Chain Redundancies

The company developed some extra inventory system that increases the base of supply and reduces the utilization of the capacity. The safe inventory process of DHL is critical part of the company development. The unexpected disruptions are considered for the development process in the company. The factory of DHL operations 24/7 that makes a vulnerable disruption. The capacity of the workers is recommended to be reduced by the proper process. The single supplier is provided by the improved quality of the services and the cost of the investment. The process is highly recommended for the development of supplier relations, cost, and quality of the services. The selection criteria is required for the development of the relation between the company and the workers. The suppliers are motivated to search the alternatives for the development of the company. The alternatives are required to be considered in the selection process and for the reliance [5].

Increasing Supply Chain Flexibility

The increase in the supply chain flexibility induced greater impact on the resilience. For instance the concurrent process and the standardized process have greater impact on the planning. The increase in the produce variety and the fluctuating process is required for the stable demand improvement. The decoupling point is related to the downstream process and makes the leaner supply chain. Therefore, the analysis recommends to reduce the delay observed in the first point of the whole differentiation. The standardized steps are used for the downstream. This process will decrease product variety along with the time of assembly for customized products [1].

Cultural Changes in DHL of Logistics and Supply Chain Management in A 3PL Service Provider

On the disruption recovery, corporate culture of the company has direct and significant impact. Therefore recommendation is to apply encouraging cultural concepts that causes to promote the success, goals accomplishment and aware about the details of day to day DHL company business. Enhance in the employees’ communication can be used as such encouraging cultural strategy or concept. Increase in the communication between employees will enable the employees to get maximum knowledge and make efficient decisions when there comes disruptions. Delegation of power and authority can also help out in this manner as because of this, employees will be able to take essential actions. Creating and encouraging passion in the employees of the DHL company will also support the workforce to take actions at disruptions.        

DHL Demand and supply management

Almost 18 months and 10 weeks are total estimated time required for the delivery of orders. Regardless, of the expansion of DHL in the global world, the lead time of DHL is all time High, considering this recommendation is to make an investment in the local production facilities as through more flexibility it is causing to enhance resilience. The decision will benefit the DHL in many ways as through this DHL can cut cost of transportation and freight, responsiveness of the company will be increased and supply chain will get more resilience. Seasonality and cyclicality are the major factors that causing to generate impact on the business of DHL regarding sales and their operations. While the problem of seasonality can be eliminated and controlled through offering short-term discounts as it will cause to generate impact on the demand factor of the company. Considering the factors of pricing and promotion in the planning DHL supply chain can get benefits and maximize the surplus in the supply chain.

In DHL Early supplier design involvement

Sustainable goals are developed in the DHL Company that will be accomplished by 2020, to get better and advance technology in the company for the purpose of making improvement in the products, the company will have to collaborate with the supply chain particularly with suppliers, thus as a result of this strategy DHL will earn benefits related to their quality management and improvement in the quality of their operations. Therefore the recommendation for the company is to build long term better relationship with their suppliers to get best resources for their operations in the cost-effective way as long-term better relationships encourages the suppliers to offer discounts and provide best quality resources in low rates.  

 References of Logistics and Supply Chain Management in A 3PL Service Provider

Appendix 1: Third-party logistics relationships

Appendix 2:  3PL Services and Activities

Appendix 3: Third Party Logistics

http://manufacturship.com/third-party-logistics-the-rationale-and-the-risk/