The third-party logistics concept is running in our world for a very long period. Businesses all around the world take the help of other business units to get their work done. There are many ways through which third-party logistics work globally, and a company can outsource whatever task of their industry they are unable to complete in house.
When the small businesses are taking the help of these third-party logistics, how can one think that a big company like Amazon is not outsourcing their work? The working flowchart of Amazon as a company is very large and broad, due to which a person has to outsource some of their work. There are different types of logistics systems that are currently working for Amazon.
- Full-Service End To End
The full end to end third party outsourcing is the type of logistics system used the most by Amazon. In this system, the company who is handling the task has to complete all the task from point A to point Z. the only work of Amazon, in this case, is to provide the information to the provider that this is the detailing of the orders and the receiver details.
Now every other task is to be completed by the outsourced company. They have to manage all the orders that are pushed by the Amazon. After that, they have to start processing the order which is made by the customer. After the order’s processing, the shipment of the product is to be made and shipped by them.
Now in the meantime, they need to provide the whole detail of the tracking to Amazon. After that, shipping and the delivery of the product are also handled. They have to complete all the tasks in this case that Amazon as a shipper has to do.
- Outsourcing Of The Warehousing Of The Material
Let us suppose that the amazon is thinking of establishing a new place where they were not earlier present. Now the business in any new area will be less, but no matter the amount of business, they will need a warehouse to store and ship their products. At this place, the warehouse outsourcing done by the amazon comes into the game.
Instead of making a new warehouse at any new place, what they do is outsource all the work of the warehouse. When they think that now they are ready to establish their warehouse, then they will make one.
- Outsourcing The Transportation
Amazon transportation can’t deliver the product to all the countries and locations worldwide. That does not mean that they will not provide their service in that area. So, to remain in the business at such a pace where they can no transport personally, amazon does hire a transportation company. This company’s task is to pick up the package from the place of its origin and later drop it at the place of the receiver end. They have to take care of transportation only so that the shipment is safely delivered to everyone.
- Distribution Outsourcing
The distribution outsourcing is the third-party logistics used by Amazon at places where they are looking only for the company to distribute the product transported by them. The reason why Amazon has to use these logistic methods is that the company is actively delivering the product at that place. Still, the only issue they face is distribution due to a lack of resources.
That is why they hire such a company that provides them the human resources to deliver the product on behalf of the company when required.
- Financial and Informational Outsourcing
Apart from work related to the shipment, there is a task for which the Amazon uses the third party logistics. That task is known as financial and information work. Amazon hires some of the outsider companies who can handle all their financial reports and provide them a compiled report of the whole financial year or the quarter.
Also, the flow of information is very important for the working of the company. This information can help in boosting up the business manifolds. That is why the company outsources this important work to some people who can handle it more professionally and efficiently.
So, these are the basic types of third-party logistics service that is used by the amazon. All the services are availed according to the situation of the place and demand of the area. According to the requirement, the company can also avail more than one type of logistics at a time.