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3PL: Pros and Cons of Outsourcing

Published: November 18, 2008 (Issue # 1426)



  • 3PL companies offer a whole range of logistics services, from transport and storage to packaging and delivery.
    Photo: For The St. Petersburg Times

In contrast with transportation companies and warehouse operators, Third Party Logistic companies offer a comprehensive range of services. Industry experts, however, note that there are both benefits and risks associated with outsourcing logistics.

Third Party Logistics, or 3PL, is the outsourcing of logistics services. 3PL operators organize the management of the flow of goods and optimize financial and information resources for product shipment and distribution.

A 3PL operator provides a whole range of services necessary to deliver products from producers to retailers. 3PL starts with moving the products from the production line, packaging and storage and delivering product lots to the stores, said Alexei Gorinov, head of the sales department at Nienshants Logistics.

Antonina Amerik, head of the marketing and development department at Maxilog logistics company, added that 3PL operators also offer secondary services such as document clearance, insurance, agent services (including loans and assistance in signing contracts), consulting and outsourcing of other business processes in the clients company.

Gorinov said that about 50 companies in St. Petersburg market themselves as 3PL operators. The market is dominated by large companies (Nienshants Logistics,Interterminal, Mega-Logistics, Relogix and FM-Logistics) and transportation companies that offer logistic services (STS-Logistics and Velts).

In addition, distribution companies use their ties with retail chains and offer logistics services, Gorinov said, as do companies that own former industrial premises in the city and in proximity to the ring road.

The benefits of 3PL are time and cost saving and a higher quality in product shipment and distribution.

The main benefit of logistics outsourcing is the time that you save by delegating the distribution process to a specialized company. Having experience of working with various groups of products, 3PL providers can organize a better and more effective distribution process, Gorinov said.

Logistics outsourcing does not mean that the company loses control over its goods while they are being transported.

High-quality logistics outsourcing always includes distant management of the flow of goods. Using a laptop, the client can order additional product delivery from any place, if he unexpectedly gets an order, Gorinov said.

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ALL ABOUT TOWN

Wednesday, July 23


SPIBAs Legislation & Lobbying Committee invites everyone interested in the practical aspects of courts and procedural law to todays Legal Debating Club at 9:30 a.m. at the Mertens House, 21 Nevsky Prospekt, office 506. Visit spiba.ru for more details.


Take advantage of the sunny summer days and participate in Beach Games 2014, which runs through July 27 in Sestroretsks Dubki Park.



Thursday, July 24


Liliana Modiliani, a well-known Russian stylist, will talk about choosing clothes that fit during her lecture at 7 p.m. at the Pryamoy Efir art club, 13 Viborgskoe Shosse.



Friday, July 25


Discuss Russias economic and political prospects for 2014 during a Business Breakfast organized by SPIBA at 9.30 a.m. in the Bank Saint-Petersburg office at 64


Malookhtinsky Prospekt.


Start your weekend with adorable miniature pigs at the Squealing Pig festival at 7 p.m. this evening in the Karl & Friedrich restaurant, 15 Iozhnaya doroga, on Krestovsky Island.



Saturday, July 26


Hundreds of brand-new and retro cars, drag and drift shows, test drives and karting are planned for the Avtobum-2014 festival, which will take place in front of the RIO shopping center at 2 Fuchika Ulitsa.


Participants in todays SaniDay Summer competition will impress visitors with their hand-made, unusual and hilarious boats, which will race at the Igora Resort near the 54th kilometer on Priozerskoe Shosse.


Metro Family Day will include both serious lectures for adults and master-classes for children, making the event interesting for the whole family. To participate, come to Kirov Park on Yelagin Island.


Photography will be the focus of todays Photosubbota, which features lectures by famous photographers, meetings with photo schools and studio representatives, and participation in a photography competition. The event starts at noon at Petrokongress, 5 Lodeynopolskaya Ulitsa.


If you like cycling, make sure to visit the Za Velogorod Festival with its retro bike exhibition, market and live music. The second round of the Leningrad Criterium race will also take place during the event at Petrovsky Arsenal in Sestroretsk.



Sunday, July 27


Navy Day will be celebrated with a weapon and military transportation exhibition, self-defense master classes and concerts. The event starts at 1 p.m. in the 300th Anniversary Park of St. Petersburg.



Monday, July 28


Dont miss a chance to see the latest achievements in robotics during the RoboDom interactive show, exhibiting more than 150 robots. The show will be at BUM center, 22/2 Gzhatskaya Ulitsa, until Aug. 3. The entrance ticket costs 350 rubles ($10).



Tuesday, July 29


A video of a Queen concert from 1986 will be shown today at 8 p.m. in Yaschik, 50/13 Ligovsky Prospekt.



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