DISTANCE : Distance is one of the most basic economic factors which determines the total transportation cost . It contributes to variable cost including labour and fuel cost .
VOLUME : The next important factor is volume of load . Transportation cost per unit of wt decreases with increase in the load volume .Its mainly due to fixed admin and other fixed cost like delivery and picking charges .
DENSITY: The density factor incorporates weight and space aspects ,which is significant because transportation cost is normally quote in terms of $ per tonne. Transportation cost per unit of weight decreases with increase in product density . Hence logistics managers are required to increase the product density ,allowing more unit of product to be loaded in container for better utilisation of space .
STOWABILITY : The stowability factor refers to product dimensions and how they affect vehicle space utilisation. Products of odd sizes and shapes waste space .they cannot be stowed well . Transportation cost are more in case of odd -shaped products .
HANDLING : specific handling facilities are required for loading and unloading to vehicle .If more sophisticated and specific handling equipment are required then transport cost goes up . To minimise handling cost now days containers are more preferred by logistic managers
LIABILITY: Transportation costs are also affected by the quantum of risk covered by the carrier during the transit of goods from origin to destination .
MARKET FACTORS : Market factors which affects transportation cost are availability of transport , emergency of freight movement ,and getting of return journey laod .
THIRD PARTY LOGISTICS ( 3PL )
Third party logistics (3PL) is the employment of outside companies whose expertise is in handling a firms logistical processes .With increased emphasis on downsizing and outsourcing in today's global economy ,many firms are outsourcing logistics services to 3PL .Use of 3PL has benefited firms in terms of gaining competitive advantages , expertise to do their job more effectively , better processes and resources to handle operations and logistics cost savings
The portfolio of logistical provided by 3PL generally includes inbound and outbound transportation ,fleet management , warehouse management , order processing ,product returns , carrier selection , logistics information , inventory repelenishment ,order picking , labelling and packaging , distribution , custom clearance and forwarding , import - export management and customer service/support - Back