Logistics service provider

4 important questions on Logistics service provider

Which 5 types of LSP's do we have?

- Freight carriers: Basic carriage of freight; by truck companies, plane, train,..

- Freight forwarders: Agents who arrange transportation and shipping of freights

- Couriers: Urgent delivery products

- Integrators: Offer services from consignor to consignee (FedEx, UPS,..)

- Agencies: companies combining buying power to gain cost reduction on freight transport rates

What is the differnce between LSPs and 3PLs?

All the companies who provide transportation services are LSPs while 3PLs provide multiple logistics services, often integrated and are third party logistics providers.

What are some 3PL services?


-Transportation
-Warehousing
-Pick and pack
-Light manufacturing
-Vendor managed inventory
-Customs clearance
-Trade financing
-Managing reverse logistics
-Parts distribution
-Inventory management
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How to choose a LSP?


-Services to be provided
-Costs and costing approach
-Terms of carriage, applicable Incoterms, insurance
-Speed/transit time
-Performance metrics and service levels, reliability
-Information systems, other technology issues and documentation requirements
-Core versus value-adding services required
-Staffing issues
-Reverse logistics issues
-Implementation/termination/ability to alter conditions
-Details on the logistics service provider's history, client references, etc.

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