The Good and Bad Sides of Logistics BPO Outsourcing

In today’s rivalry business era, each and every business sector demands the need for outsourcing their back-office services or the non-core tasks. Irrespective of the size of your logistics business, presently, a majority of the firms have adopted the trend of outsourcing their needs.

Outsourcing your logistics BPO solutions to a renowned offshore service provider can help you achieve the solutions for your complicated issues with an ease. The process of logistics outsourcing is one of the finest ways to free up the valuable resources and also to optimize the cost efficiency.

In the present global logistics scenario, the demand put forward by the customers are expanding rapidly and hence, the concept of outsourcing is vital for your endurance.

The logistics sector is believed to be the major element for powerful supply chain management. An efficient logistics service provider will ensure that the output is delivered on a timely basis, in order to achieve 100% customer satisfaction.

The major logistics BPO outsourcing is associated with:

• Ocean
• Road
• Rail
• Air

Let’s take a glance at the good and bad sides of outsourcing logistics BPO services.

The Merits

• Economies of scale – The logistics firm usually possess an excellent network of distributing the goods to any destination without hassles. With the outsourcing of BPO support solutions, one can easily scale up and down the widespread of your logistics business. You can save your time from setting you the in-house equipment or infrastructure.

• A streamlined way of documentation – Most of the logistics based organizations are dealing with a bulk of paperwork on a daily basis. But it involves a huge amount of time and is considered to be a complicated task. The service providers possess the best knowledge regarding how to handle and organize all the paper related works such as dealing with insurance certificates, digitizing BOL, etc.
• Minimizing the burden of back-office tasks – A lot of back-office and administrative work is involved in every business fields including the logistics. The basic logistic function such as sending the physical packages from the source to the destination seems to be simple, it involves a lot of back-office burden. Converting the physical BOL into an electronic format is one of the major tasks. It is followed by the execution of excellent auditing and verification of the documents involved. The outsourcing service providers have a streamlined set of software or technological measures to handle these procedures efficiently. The other administrative tasks include performing physical verification and assigning the dispatch note so as to ensure that the shipping papers are placed in order.
• Real-time visibility – The well-established outsourcing service providers makes the optimal use of the ERP systems or the management systems so as to monitor the inventory on a real-time basis. The result can be gained from the service providers on a frequent interval, which will be beneficial for the enhancement of the supply chain management.
• Excellent expertise – Generally, the outsourcing service providers have a team of dedicated and professional staffs who possess the best expertise in dealing with the logistics BPO solutions with the help of contemporary technologies. They are updated from time-to-time regarding the latest trend or emergence of the new technologies.

The Demerits

• Failure of considering logistics outsourcing as a strategy – The business of logistics has a critical role to play in the overall strategy formation of an organization. The business scenario and the needs of the customer have been changing constantly. Various factors such as the on-demand services or the eCommerce requirements have altered the business environment. If you are outsourcing the logistics support services, considering it just like a function, it won’t enhance your business’s economy of scale. Rather, consider it to be a strategic element.
• No specified roles and duties – Logistics is considered to be a subset of the supply chain and also involves numerous micro-process. It can lead to an increase in the complications during the logistics planning and execution. Before outsourcing, ensure that the roles and duties of each service should be duly written under the Service Level Agreement.
• Selecting low-cost vendor – Most of the firms approach the very low-cost service providers who fail to serve the clients with the relevant or expected quality. So, rather than hurrying and taking a decision, make sure to select the appropriate service provider.
• No apt appraisal process – Most of the time, it is a challenging process to find a perfect service provider to meet your logistics needs. The process of appraisal includes collecting the quotes and setting the standards, and so on. Hurrying with the outsourcing process without abiding by the required process can lead you into trouble.

Though outsourcing logistics support services come with a lot of benefits and adverse effects, most of the demerits are caused due to poor planning. It can be avoided by taking the essential and highly reliable steps at the right time.

At NexGen Logistics BPO, our team of excellent and professional staffs will ensure that our client achieves highly satisfied output at a user-friendly budget.

To know more, drop us an email at [email protected]