Describe the various factors that have to be considered when

Solution

Logistics service providers need to be selected very carefully for the success of the business. It is very crucial for the success of the import and export businesses to ensure timely delivery and receiving of goods. The factors considered when selecting the logistics service providers are:

a. Cost aspects- There are different cost structures for the different types of logistics and the providers need to provide the cost structure as required by the businesses. The cost should be acceptable and should be at a competitive price.

b. Service level- The logistics providers needs to provide quality service to deliver the products. Hence, the companies looking for a logistics service provider must seek the competitor’s service level to make a choice.

c. Logistics route- The existing channels and routes needs to be checked to see if they fit the logistics provider’s schedule. If it does not match, then the channel needs to be redesigned to fit the service provider’s schedule.

d. Checking of the shipping lines- The connections and the reputation of the shipping lines needs to be checked to ensure good performance by the shipping lines. All sea freights needs to check this aspect to choose the right service provider.

Conclusion- Though the above are crucial factors considered in choosing the service providers, there are other general factors to choose like the proximity of the service providers to the companies.

Personally speaking, in reality the consignors choose the logistics service providers on cost. Since the businessmen seek to reap more profit in each of the transactions, the consignors choose the service providers who quote a lesser cost from the competitors.