Schneider Logistics

By Purchasing Staff -- Purchasing, 10/2/2007 8:37:00 AM

SIGNS THAT YOU SHOULD OUTSOURCE LOGISTICS

1. Focus. You're a small- to medium-size company that wants to focus your intellectual, investment and human capital on your core areas and/or areas outside of logistics (i.e. market share growth, manufacturing excellence).

2. Speed. Your company wants to use speed-to-market to differentiate itself in the marketplace.

3. Complexity. Your company has a complex supply chain or is experiencing significant reorganization.

4. Flexibility. Your company wants a logistics network that is more flexible and scalable based on constantly changing business models.

5. ROI. Your company wants to improve return on assets or convert their current logistics fixed costs to a variable cost model. (Especially true if they have heavy warehousing assets or labor-intensive operations.)

6. Expertise. Your company recognizes that outsourcing its logistics function offers more expertise and market leverage than employing individuals within the organization to manage logistics across every mode of transportation you deal with.

7. Improved flow. Your company wants to reduce inventory, improve fill rate, reduce back orders, lower its transportation spend and improve service.

SIGNS THAT YOU SHOULD NOT OUTSOURCE LOGISTICS

1. Lack of expertise. Your company isn't engaged in the logistics function and isn't willing to work through internal barriers.

2. You’re doing it. Your company has the scope and scale to support logistics excellence. (Mega-retailers often reach this level.)

Source: Todd Ericksrud, vice president, global logistics sales, Schneider Logistics