Logistics services help companies solve their supply chain worries by organising an efficient delivery system. These services handle shipping for companies from the point of manufacture to the point of delivery. There are different types of logistics services in India offered by companies to match specific business needs. Most common offering of logistics companies is road transportation services while others feature shipping via rail and air.
Many companies have an internal logistics network, for example, Ekart Logistics built by Flipkart to transport its e-Commerce products across India. These firms have their own distribution network, a logistics strategy and a department dedicated to looking after their transport needs. This does require a huge investment to be shelled out by the company, but the large-scale nature of product transport makes it ideal for them to invest in an internal logistics operation. It helps them gain full control of their supply chain process.
While many firms like Flipkart find it easier to set up a logistics platform to suit their unique business needs, other firms find outsourcing logistics services more efficient. Small and emerging businesses often outsource their transportation needs to a logistics company. Outsourcing transportation to a logistics firm will allow you to avoid hefty warehousing costs and the expenses of owning your own truck for transport. Logistics companies will even have global links that will provide small businesses access to global markets.
Types of logistics services in India
If you are an MSME looking for a logistics partner for your business, there are different types of logistics transportation you can consider to suit different business transportation needs.Here are examples of types of logistics services in India you should know about:
1.Inbound logistics services
Inbound logistics services as the name implies is the transportation involved in procuring raw materials for manufacturing. These services take care of the incoming supplies to the company’s production units. Once an order is placed with your supplier, the consignment will be picked up by your logistics partner and delivered to you within the agreed timeline. Depending on the timeline you can choose rail, road or air route for your supplies to reach on time.
For example, you are a manufacturer of Printed Circuit Boards (PCB).You would need fiberglass, copper, PTFE, etc., as your raw materials for creating the board. All these materials are procured using an inbound logistics service.
2.Outbound logistics services
Services that carry your shipment to the point of consumption are called outbound logistics services. This is one of the types of logistics services that comes second in the supply chain link where finished goods are transported from the manufacturing facility to customers. e-Commerce companies involved in door-to-door services and last-mile logistics are a great example of outbound logistics. These services are very important for businesses as consumers expect on-time delivery of their products. They also want the package to reach them without any damage, which means your logistics partner should guarantee the safety of your package.
3.Full truckload (FTL) services
If the size of a consignment needs the space of an entire truck to fit in, then businesses opt for FTL services. This is normally used to transport shipments in large quantities. For example, if a company is shipping large quantities of iron to a steel manufacturer, then it will opt for FTL services of its logistics partner. Here, one truck will carry a dedicated shipment from a single company where products stay in the same truck from pick-up to drop-off. Since there are no pickups and drop-offs along the way, FTL shipments reach their destination sooner and only require minimal handling.
4.Partial truckload (PTL) services
Partial truck load (PTL) services are low-cost logistics services often chosen by small businesses for their transportation needs. PTL services are used when a company’s consignment doesn’t require the space of an entire truck, especially when the purchase order is small. These services are used when the shipment only needs a part of the truck. The rest of the space is used for cargo from a different firm, which means that you will share your delivery truck with another company. Your shipment will stay on a single truck and will only be stopped for a limited time to unload the other company’s load. This also results in minimal handling of your finished goods, ensuring the safety of the shipment.
5.Less than truckload (LTL) services
LTL services are for transporting small quantities of goods. Many logistics services companies in India offer this option to businesses who need to transport small quantity shipments frequently. This is an economical method to transfer smaller goods and is another low-cost logistics service. LTL service providers combine different orders from different companies on a single truck. This helps companies split costs of transportation and eliminates hiring an entire truck for a small consignment. This is one of the types of logistics services that offers a cost-effective shipping option to companies.
When the customer is dissatisfied with a product, he/she will choose to return the product back to the company. This is where reverse logistics management comes into play. Reverse logistics is when the product is picked up from the end customer and delivered back to the manufacturer for repair or replacement. Transporting products for refurbishing, repairing, exchange, disposal, or recycling is via reverse logistics services.
7.Third party and fourth party logistics
Third-party logistics services or 3PL services are the most preferred logistics solutions of businesses. Warehousing, inventory management, shipping and receiving, picking and packing, reverse logistics are the services that are offered by a 3PL service provider. These service providers can ship anything ranging from food products to hazardous materials. Most companies prefer 3PL services as they can handle the entire supply chain with live order tracking. Companies can also choose to outsource a single supply chain activity like warehousing to a 3PL service provider.
Fourth-party logistics services or 4PL services is when a firm outsources its entire supply chain management to a single logistics provider.These service providers are charged with managing warehouses, shipping, and delivery partners.While a 3PL service might only be responsible for a single task in the supply chain, a 4PL service is tasked with managing the entire supply chain and is therefore the single point of contact for a company for its logistics support.
How to choose a reliable logistics service provider?
Choosing a logistics partner depends on the type of logistics service you want to choose. Outsourcing logistics services makes sense for MSMEs who have less shipments and shipments in small batches. This reduces the overall logistics costs and makes handling shipments easier. On-time and safe delivery at budget friendly prices is key to finding the best logistics provider. Domestic logistic services that can provide warehousing requirements will be the right choice for an MSME to not only eliminate warehousing costs but also ensure safe storage.