Third-party logistics: Market structure

Corporate managers traditionally have viewed logistics as a mandatory cost bucket. But top-performing companies now recognize that mastering supply chain and logistics can be more than that: It can be the source of competitive advantage.

For logistics providers, the value proposition rests on three key pillars: optimizing logistics costs for customers, shortening the length of the order completion cycle and reducing the number of fixed assets.

Enron East Africa Limited usually examines both the market and winning models used by other logistics providers to leverage on them.

Outsourced logistics activities commonly fall into three types of services: contract logistics, freight forwarding and transportation. These businesses are deeply interconnected, For example, freight forwarding operations frequently involve activities associated with contract logistics services that are performed when goods are collected and received, such as cross-docking and warehousing.

Similarly, contract logistics providers often are responsible for local distribution and derived truck transportation.