What is 3PL? How does It Benefit Your Business?

1. What is 3PL?

3PL (short for Third Party Logistics) is an outsourcing service provider dealing with e-commerce logistics for you. You make and receive orders through the online marketplace and e-commerce platform whose logistics is performed by 3PL, which includes: receiving purchases from yourself or your suppliers; store inventory in one or more warehouses; select items for the order; packaging orders for delivery; arrange shipping the order to the customer; handle returns of inventory items.

2. How does 3PL benefit your business?

The third profit excavated by the third party logistics is basically reflected in the users, which increases the profits of users. Users can make a third profit from the following aspects:

(1) Decrease cost

One of the driving forces for enterprises to consider outsourcing their logistics operations to third-party logistics is to reduce costs. Because enterprise can outsource their logistics business to the third party in the form of a service fee for services with no need for internally maintaining logistics infrastructure such as transportation facilities and warehouse and personnel, making the fixed costs into variable costs whose impact is more obvious for those with seasonal variation in business.

With strong purchasing power and cargo loading capacity, the third-party logistics company can implement joint distribution through its extensive meshed network or can get even cheaper transport quotation from shipping company or other logistics service providers. It's possible for the company to buy shipping services in bulk from a carrier and realize centralized loading for different customers, greatly reducing unit transportation cost.

(2) Help enterprises to improve customer service level and quality

Making use of the information network and meshed network of the third-party logistics enterprise speeds up the ability to respond to customers' orders and order processing, shortens the time from order to delivery and carries out door-to-door transportation, realizing delivery of goods and improving customer satisfaction.

Through its advanced information and communication technology, third-party logistics can strengthen the monitoring of goods in transit, timely find and deal with accidents in the distribution process, ensure the timely and safe delivery of orders to the destination, and fulfill the promise to customers as far as possible. After-sales service of products, door-to-door delivery, return handling, waste recycling, etc. can also be completed by the third-party logistics enterprises to ensure providing customers with stable and reliable high-level services.

(3）Integrated benefits

3PL is both the strategic investor of customers and the undertaker of risks. The third-party logistics company does not pursue short-term economic benefits, but rather serves customers as an investor, which is a typical characteristic of it as a strategic ally. For example, in order to meet the needs of customers, third-party logistics companies often invest in or form joint ventures to build modern specialized warehouse, personalized information system and special transportation equipment for customers. Such investment can be as small as tens of thousands of yuan, or as large as millions, tens of millions or even hundreds of millions of yuan, which directly saves a lot of construction costs for customers, but the risks of such investment must also be borne by the customers themselves. Therefore, the third-party logistics service itself is a long-term investment and the income of such investment depends largely on the growth of customer business volume, which forms the basis for the integration of interests of both sides.

(4) Improve business value chain

The improvement of value chain is a hot spot in modern enterprise management. Conceptually, the value chain mainly describes the interaction and dependency between suppliers, producers, intermediaries and customers as well as their internal strategic business units so as to identify the value they create for customers and strengthen the company's competitive advantage. In practice, there are two main forms of so-called value in the value chain: providing undifferentiated goods or services at a lower price than competitors; providing a unique quality product or service at a reasonable additional cost.

Value chain plays an important role in the realization of logistics integration by enterprises to obtain and maintain their competitive advantages. It can be used to identify and understand the specific resources where enterprises generate competitive advantages and how these resources create value-added services for customers.

The essence of 3PL is to coordinate customer service requirements and logistics activities starting from suppliers, giving consideration and optimization to high customer service level, low inventory investment and low operating cost. Therefore, reducing operating costs and the occupation of working capital, improving the rate of return on assets (ROA) and enhancing the competitiveness of enterprises are the value expression of efficient 3PL.

Shanghai Realhong International Logistics Co., Ltd. is a professional logistics services company. We provide Air Freight, Road Freight, logistical management and so on. Want to know more? Please contact us.

How to Choose an International Transport Company?

This article will introduce what kind of problems should be considered in choose an international transport company. I hope it helps.

1. Inspect certificate of transport company

Verify the business license before shipment, check the non vessel operating common carrier(NVOCC) code of the transport company and the international forwarder certificate number approved by the relevant department, or the relevant certificate of country-level NVOCC agent as well as the registration time and registered capital (this is the most basic and necessary).

2. Be aware of the transport company grade

Transport companies are generally divided into first, second, third, fourth level and so on. Generally, shipping companies will issue freight rate and shipping space to first-level freight forwarders (NVOCCS). Another kind that has direct contact with freight shipping companies is the designated agent of shipping companies, that is, freight forwarders that can provide stable supply of goods for a long time and maintain good cooperative relations with shipping companies (similar to first-level NVOCCs). After getting the route price, the first-level shipping agent will issue it to some subordinate second-level freight forwarders in bulk cheap, and the second-level ones will send relevant information and freight rates to the third-class freight companies, and so on.

Therefore, sometimes shippers directly apply to the shipping company for prices and shipping space which might be a lot higher than that of transport company. However, choosing a freight forwarder is also prone to problems. For example, when finding a fourth-level freight forwarder to ship the goods, once problems arise, the solution efficiency will be rather slow and it is easy to complicate things. Therefore, it is better to choose a first-level freight forwarder with high reputation (NVOCC) when choosing a freight forwarder.

3. Conditions for choosing a freight forwarder

(1) First of all, it is necessary to know the dominant route and the superior shipping company, and then get to know the route from the carrier to the port, closing day, sailing days, and whether the freight rate is appropriate.

(2) Whether the company can provide relevant agent customs clearance, trailer and warehouse storage capacity, preferably with its own customs clearance and trailer department, so that the whole process of transportation can be more properly connected. The designated transport company takes full charge of any flaw in the link.

(3) Whether the forwarder understands the pattern of international trade and its development trend and freight traffic direction, etc. For example, in Western Europe, the United States, Canada, Japan and other countries with higher industrialization, it brings great convenience to shippers to predict costs that knowing whether goods is exported to the country's port of destination, there is any special limitation on the items, what special relevant certificates needed and what kind of additional charge should be charged in a certain route.

(4) Whether the pre-allocated shipping company is a direct vessel or needs to make a transfer, which port the transfer takes place, and whether the transfer can be made to ensure that the transfer is completed on the current ship without offloading at the transit port.

(5) As for transporting special product, it's necessary to know whether the transport company has the transport ability and services to receive these special products, such as chemical products, frozen products, food, dangerous goods, items in powder or liquid state, as well as OOG (RF, NOR, FR OT, etc.) and other special services (depending on their own enterprise product). Generally speaking, qualified carriers of special goods can provide relevant documents such as shipping certificates.

(6) A first-level freight forwarder shall be skilled in operating the carriage of goods by sea documents, understand the process and steps of relevant agents, and ensure the accuracy, clarity and promptness. The main sea freight documents include bill of lading, sea waybill, manifest, invoice, delivery note, packing list, dock receipt, Mate's Receipt.

(7) A better freight forwarder should be familiar with customs procedures and port business processes. Customs clearance is a traditional function of a freight forwarder in import and export trade. In the dual relationship between the freight forwarder and the customs authorities and customers, the legal status of the freight forwarder varies from country to country, but the customs agent is usually authorized by the government. The customer shall consider whether the forwarder's capacity as a customs agent is capable of protecting both the customer and the customs authorities in the performance of their duties.

The freight forwarder should have the ability to handle the port arrival and departure formalities, bonded storage, inland customs clearance, etc. The operation ability of port procedures is very important.

Shanghai Realhong international logistics Co., Ltd. has been focusing on the international logistics special line cargo transport services since establishment. While constantly improving the service quality, we are also gradually improving our freight services, striving to provide faster, safer, more economical and higher level international air and sea transport services.

Shanghai Realhong International Logistics Co., Ltd. is a professional logistics agent. We provide Air Freight, Road Freight, global logistics and so on. Want to know more? Please contact us.

The Difference between International Air Freight and International Express

The difference between international air freight and international express:

1. Major airlines are the main subjects of international air freight, such as Air China, Shenzhen Airlines, Singapore Airlines, Thai Airlines, Malaysia Airlines, Northwest Airlines. The main body of international express is the major express companies, such as DHL, UPS, TNT, EMS, OCS, AAE, DPEX, FedEx.

2. International air freight only sends goods to the airport, while international express sends them to one's home.

3. Generally speaking, international same day air freight requires inspection of export commodities (some goods do not need inspection), while international express does not need that.

4. The time limit of international air freight and express delivery is almost the same, which is about several days. Some places are faster by international air freight, and some are faster by international express. For example, it would be the fastest by international air freight if goods are sent to Tokyo, Japan. The speed of time is mainly related to the following three factors:

1) The efficiency and strength of the transportation company

2) Airport flight schedule

3) Customs clearance speed at the destination

5. International air freight is calculated by the maximum weight concerning the the volume weight and the actual weight (note: the volume weight is calculated by the formula of length * width * height /6000, in which the length, width and height are calculated in centimeters. Bulk cargo is called dump, also called bubble. As for the nano-pillow, the actual weight is only 5 kg, but the volume weight even reached 28 kg, so it is not cost-effective by international air freight. The four major international express-DHL, UPS, TNT and fedex are all calculated in the same way as international air freight, that is, to calculate by the maximum weight between the volume weight and the actual weight. Only EMS international express is to charge by weight (no matter how big the volume is) strictly.

Shanghai Realhong International Logistics Co., Ltd. is a professional shipping logistics company. We provide Air Freight, Road Freight, ocean freight and so on. Want to know more? Please contact us.

Main Operation Process and Problem Analysis of Sea Freight Consolidation

Sea freight consolidation can be divided into direct and indirect

Direct ocean shipping means that the goods in sea freight consolidation containers are loaded and unloaded at the same port, and the goods are not unpacked until they arrive at the port of destination, that is the goods are at the same port of discharge. 

This kind of sea freight consolidation service is short in time, convenient and fast. Generally, powerful  companies will provide this kind of service. Indirect sea freight consolidation means that the goods in the container are not of the same destination port, which needs to be unpacked and unloaded or transshipped halfway. Due to different destination ports, long waiting time and other factors, the shipment time of such goods is long, and even the freight is high.

The process of indirect sea freight consolidation is mainly as follows:

1. The shipper sends the consignment note to the forwarder or the shipping agent. The contents in the Booking should include the following points: SHIPPER, CONSIGNEE, NOTIFY PARTY, specific port destination, number of pieces, gross weight, size, name of goods, date of shipment and customs code.

2. The freight forwarder shall book space with the shipping company according to the requirements of the shipper booking, and send space allocation notice to the shipper. The shipping address, contact number, contacts and the latest delivery time will be indicated in the shipping notice. The shipper is required to deliver the goods according to the information provided and to ship the goods before the latest delivery time.

3. The shipper shall arrange the delivery to the warehouse or ask the forwarder to arrange door-to-door pick up according to the latest delivery time on the shipping notice. Generally, there will be a designated warehouse address on the shipping notice of bulk cargo, and to deliver the goods to this address before the delivery time.

4. The shipper should provide the customs declaration information to the forwarder after warehousing, so that the forwarder can handle the customs declaration. The size and weight of the goods on the customs declaration form should be the same as the actual weight and size, otherwise it will affect the customs declaration and passage.

5. The forwarder will send the confirmation copy of lading to the shipper for confirmation after the goods are delivered to the warehouse. The shipper shall confirm and send back the copy of lading as far as possible before the shipment, otherwise the normal issuance of lading copy may be affected. After sailing, the forwarder will issue the copy of lading to the shipper 1-2 working days after receiving the shipper's confirmation copy of lading.

Shanghai Realhong International Logistics Co., Ltd. is a professional transport logistics company. We provide Air Freight, Road Freight and so on. Want to know more? Please contact us.

The Superiority of Container Freight Transportation

Features of container freight transportation

From the perspective of the container itself:

1. Steel structure, strong and durable, and it can be used repeatedly for a long time.

2. Standard specifications. It can be stacked on the port and ship, saving a lot of space.

3. Large capacity, multiple categories, multiple functions, and various types of goods.

4. Reduce the cost of packaging, transportation and loading and unloading of goods.

Externalities of container application:

5. Formulate standards and unify the industry transport standards.

6. Promote the reform of ship types and loading and unloading machinery.

7. Improve loading and unloading efficiency and speed up vehicle and ship turnover.

8. Promote new employment and create new jobs.

9. An important symbol of port modernization and internationalization.

Superiority of container freight transportation

1. Ensure the safety of the goods. Due to the implementation of "door to door" transport of containers, the goods has been in the original loading state from they are packed into warehouse by shipper to they arrive the warehouse of the receiver in the destination port. There is no problem of goods moving in reverse direction halfway, and the use of machinery during loading and unloading operations greatly reduces the damage caused by manual handling of goods.

2. Save packing costs. Due to the implementation of "door to door" transportation in containers, many goods can be removed from packaging to unpacked or simplified packaging into containers, thus reducing packaging materials and costs. Such as some goods are wrapped with wooden box originally no longer needs them after the application of container, reducing the cost and numerous wood.

3. Improve loading and unloading efficiency. Container loading and unloading are mechanized operations with great efficiency, so manual handling cannot be compared. Simplified freight procedures, and make railway freight transport more efficient. Each piece of goods need two tickets, and they need to be counted one by one. When applying container freight transportation, the small goods are put in large boxes with two tickets on each box. The handover will be made through vessel seal, so the inspection and inventory will be easy, greatly improving efficiency.

4. Accelerate capital turnover. 

Due to its priority, the good in container can be processed, assembled, put in port and cars first, so the container freight transportation is fast. It can supply the market in time, which acceleartes capital turnover. 

5. Containers can be accepted and delivered in the open space, which can solve the problem of insufficient warehouse in some stations, improve the loading and unloading efficiency of vehicles, and accelerate the turnover time of vehicles, etc.

Shanghai Realhong International Logistics Co., Ltd. is a professional goods transport agency. We provide Air Freight, Road Freight, interstate freight and so on. Want to know more? Please contact us.