Global Logistics and Supply Chain Strategies - April 2008 - (Page 30) Table 1: Contract Logistics Value-Added Services and Capabilities 4PL/Lead Logistics Provider Inventory/Vendor Management Light Manufacturing/Assembly Call Center Management Pool Distribution/Cross Docking Radio Frequency and Barcoding Deployment Food Grade/Temperature Controlled Installation/Removal ISO Certification Transportation Network Planning/Optimization Carrier Contracting/Brokerage/Freight Payment Transportation & Event Management Systems Customs Brokerage/ACE/C-TPAT/FAST Project Management Consulting/Process Re-engineering JIT Kanban Kitting/Pick & Pack Reverse Logistics WMS Deployment Small Package/Fulfillment Hazmat Handling Home Delivery Order Management Transportation Execution/Freight Bill Payment Internet Supply Chain Visibility Bulk Materials Handling Security Systems Deployment Merge-in-Transit Source: Armstrong & Associates GM’s supply chain. Wal-Mart, the world’s largest company, ranks third in 3PL use with 32 3PL relationships. DaimlerChrysler follows Ford, GM and Wal-Mart in fourth place with 31 relationships. Major 3PL contracts with Fortune 200 companies regularly exceed $50m per year. Most of these $50m-and-greater accounts are with automotive and high-tech companies. We estimate that there are 200 or more of these accounts globally. Not all Fortune 500 companies have business models that would require the services of a 3PL. We have excluded Advertising, Financial, Insurance, Real Estate and Waste. The results after the exclusions are shown in Figure 1. In 2007, 74 percent of the domestic Fortune 500 used at least one 3PL. As Figure 1 shows, company size continues to be a good predictor of 3PL use; the larger the company, the more likely it will have at least one relationship with a 3PL. We believe that some of the inter-year variation is due to changes in the mix of customer relationships being reported by 3PLs and shifts in the Fortune rankings. There is some underreporting of customer relationships in all categories. In some cases, this can be attributed to confidentiality agreements preventing 3PLs from naming customers. However, there has been a significant increase in the penetration of all Fortune companies by 3PLs since 2001. These increases are largest in groupings 401-500 and 301-400. The increase from 2001 to 2007 is smallest in the group 1-100. The overall pattern of increases in each ranking group indicates a significant trend of smaller companies outsourcing more functions to 3PLs over the last few years. Use of 3PLs has doubled since 2001 in the 301-400 group and gone up 254 percent in the 401-500 group. As we pointed out in previous reports, two primary sales strategies have emerged. DHL Logistics, Menlo Worldwide, Penske Logistics, Ryder and other well-known major 3PLs emphasize selling to the top 200 to 250 Fortune companies. Other companies like C.H. Robinson and Landstar Global Logistics are more inclined to pursue smaller accounts offering the potential for longer relationships with better profit margins. The awareness among Fortune 1011000 companies of the benefits of using 3PLs is continuing to grow and this growth should hold over the next five or more years. For their part, 3PLs continue to develop business opportunities at three to four times the rate of growth in the U.S. GDP. We estimate that the overall U.S. 3PL The major scale differentiators among third-party logistics providers themselves revolve around supply chain management systems and logistics engineering expertise. 30 APRIL 2008
Table of Contents Feed for the Digital Edition of Global Logistics and Supply Chain Strategies - April 2008 Global Logistics and Supply Chain Strategies - April 2008 Contents Editorial GL & SCS Exclusive Fast Forward Up Front Cover Story: Continuing to Add Ever More to Their Offerings, 3PLs Are - At Your Service Over the Long Haul Opinion: Freight Audit Bill Can't Show All Mistakes that Hurt the Bottom Line Opinion: The ‘Good-Freight’ and ‘Bad-Freight’ Trucking Customers Industry Voices Global Logistics and Supply Chain Strategies - April 2008 Global Logistics and Supply Chain Strategies - April 2008 - Global Logistics and Supply Chain Strategies - April 2008 (Page Cover1) Global Logistics and Supply Chain Strategies - April 2008 - Global Logistics and Supply Chain Strategies - April 2008 (Page Cover2) Global Logistics and Supply Chain Strategies - April 2008 - Contents (Page 3) Global Logistics and Supply Chain Strategies - April 2008 - Contents (Page 4) Global Logistics and Supply Chain Strategies - April 2008 - Contents (Page 5) Global Logistics and Supply Chain Strategies - April 2008 - Editorial (Page 6) Global Logistics and Supply Chain Strategies - April 2008 - Editorial (Page 7) Global Logistics and Supply Chain Strategies - April 2008 - GL & SCS Exclusive (Page 8) Global Logistics and Supply Chain Strategies - April 2008 - GL & SCS Exclusive (Page 9) Global Logistics and Supply Chain Strategies - April 2008 - GL & SCS Exclusive (Page 10) Global Logistics and Supply Chain Strategies - April 2008 - GL & SCS Exclusive (Page 11) Global Logistics and Supply Chain Strategies - April 2008 - Fast Forward (Page 12) Global Logistics and Supply Chain Strategies - April 2008 - Fast Forward (Page 13) Global Logistics and Supply Chain Strategies - April 2008 - Fast Forward (Page 14) Global Logistics and Supply Chain Strategies - April 2008 - Fast Forward (Page 15) Global Logistics and Supply Chain Strategies - April 2008 - Up Front (Page 16) Global Logistics and Supply Chain Strategies - April 2008 - Up Front (Page 17) Global Logistics and Supply Chain Strategies - April 2008 - Up Front (Page 18) Global Logistics and Supply Chain Strategies - April 2008 - Up Front (Page 19) Global Logistics and Supply Chain Strategies - April 2008 - Up Front (Page 20) Global Logistics and Supply Chain Strategies - April 2008 - Up Front (Page 21) Global Logistics and Supply Chain Strategies - April 2008 - Up Front (Page 22) Global Logistics and Supply Chain Strategies - April 2008 - Up Front (Page 23) Global Logistics and Supply Chain Strategies - April 2008 - Up Front (Page 24) Global Logistics and Supply Chain Strategies - April 2008 - Up Front (Page 25) Global Logistics and Supply Chain Strategies - April 2008 - Up Front (Page 26) Global Logistics and Supply Chain Strategies - April 2008 - Up Front (Page 27) Global Logistics and Supply Chain Strategies - April 2008 - Up Front (Page 27a) Global Logistics and Supply Chain Strategies - April 2008 - Up Front (Page 27b) Global Logistics and Supply Chain Strategies - April 2008 - Cover Story: Continuing to Add Ever More to Their Offerings, 3PLs Are - At Your Service (Page 28) Global Logistics and Supply Chain Strategies - April 2008 - Cover Story: Continuing to Add Ever More to Their Offerings, 3PLs Are - At Your Service (Page 29) Global Logistics and Supply Chain Strategies - April 2008 - Cover Story: Continuing to Add Ever More to Their Offerings, 3PLs Are - At Your Service (Page 30) Global Logistics and Supply Chain Strategies - April 2008 - Cover Story: Continuing to Add Ever More to Their Offerings, 3PLs Are - At Your Service (Page 31) Global Logistics and Supply Chain Strategies - April 2008 - Cover Story: Continuing to Add Ever More to Their Offerings, 3PLs Are - At Your Service (Page 32) Global Logistics and Supply Chain Strategies - April 2008 - Cover Story: Continuing to Add Ever More to Their Offerings, 3PLs Are - At Your Service (Page 33) Global Logistics and Supply Chain Strategies - April 2008 - Cover Story: Continuing to Add Ever More to Their Offerings, 3PLs Are - At Your Service (Page 34) Global Logistics and Supply Chain Strategies - April 2008 - Cover Story: Continuing to Add Ever More to Their Offerings, 3PLs Are - At Your Service (Page 35) Global Logistics and Supply Chain Strategies - April 2008 - Cover Story: Continuing to Add Ever More to Their Offerings, 3PLs Are - At Your Service (Page 36) Global Logistics and Supply Chain Strategies - April 2008 - Cover Story: Continuing to Add Ever More to Their Offerings, 3PLs Are - At Your Service (Page 37) Global Logistics and Supply Chain Strategies - April 2008 - Cover Story: Continuing to Add Ever More to Their Offerings, 3PLs Are - At Your Service (Page 38) Global Logistics and Supply Chain Strategies - April 2008 - Cover Story: Continuing to Add Ever More to Their Offerings, 3PLs Are - At Your Service (Page 39) Global Logistics and Supply Chain Strategies - April 2008 - Cover Story: Continuing to Add Ever More to Their Offerings, 3PLs Are - At Your Service (Page 40) Global Logistics and Supply Chain Strategies - April 2008 - Cover Story: Continuing to Add Ever More to Their Offerings, 3PLs Are - At Your Service (Page 41) Global Logistics and Supply Chain Strategies - April 2008 - Cover Story: Continuing to Add Ever More to Their Offerings, 3PLs Are - At Your Service (Page 42) Global Logistics and Supply Chain Strategies - April 2008 - Cover Story: Continuing to Add Ever More to Their Offerings, 3PLs Are - At Your Service (Page 43) Global Logistics and Supply Chain Strategies - April 2008 - Cover Story: Continuing to Add Ever More to Their Offerings, 3PLs Are - At Your Service (Page 44) Global Logistics and Supply Chain Strategies - April 2008 - Cover Story: Continuing to Add Ever More to Their Offerings, 3PLs Are - At Your Service (Page 45) Global Logistics and Supply Chain Strategies - April 2008 - Cover Story: Continuing to Add Ever More to Their Offerings, 3PLs Are - At Your Service (Page 46) Global Logistics and Supply Chain Strategies - April 2008 - Cover Story: Continuing to Add Ever More to Their Offerings, 3PLs Are - At Your Service (Page 47) Global Logistics and Supply Chain Strategies - April 2008 - Over the Long Haul (Page 48) Global Logistics and Supply Chain Strategies - April 2008 - Over the Long Haul (Page 49) Global Logistics and Supply Chain Strategies - April 2008 - Over the Long Haul (Page 50) Global Logistics and Supply Chain Strategies - April 2008 - Over the Long Haul (Page 51) Global Logistics and Supply Chain Strategies - April 2008 - Over the Long Haul (Page 52) Global Logistics and Supply Chain Strategies - April 2008 - Over the Long Haul (Page 53) Global Logistics and Supply Chain Strategies - April 2008 - Over the Long Haul (Page 54) Global Logistics and Supply Chain Strategies - April 2008 - Over the Long Haul (Page 55) Global Logistics and Supply Chain Strategies - April 2008 - Over the Long Haul (Page 56) Global Logistics and Supply Chain Strategies - April 2008 - Over the Long Haul (Page 57) Global Logistics and Supply Chain Strategies - April 2008 - Over the Long Haul (Page 58) Global Logistics and Supply Chain Strategies - April 2008 - Over the Long Haul (Page 59) Global Logistics and Supply Chain Strategies - April 2008 - Opinion: Freight Audit Bill Can't Show All Mistakes that Hurt the Bottom Line (Page 60) Global Logistics and Supply Chain Strategies - April 2008 - Opinion: Freight Audit Bill Can't Show All Mistakes that Hurt the Bottom Line (Page 61) Global Logistics and Supply Chain Strategies - April 2008 - Opinion: The ‘Good-Freight’ and ‘Bad-Freight’ Trucking Customers (Page 62) Global Logistics and Supply Chain Strategies - April 2008 - Opinion: The ‘Good-Freight’ and ‘Bad-Freight’ Trucking Customers (Page 63) Global Logistics and Supply Chain Strategies - April 2008 - Industry Voices (Page 64) Global Logistics and Supply Chain Strategies - April 2008 - Industry Voices (Page 65) Global Logistics and Supply Chain Strategies - April 2008 - Industry Voices (Page 66) Global Logistics and Supply Chain Strategies - April 2008 - Industry Voices (Page Cover3) Global Logistics and Supply Chain Strategies - April 2008 - Industry Voices (Page Cover4)
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