Optimized third-party logistics criteria for fast moving consumer goods sector in Bangladesh

Abstract

In the service industry, the most effective manner in conducting sustainable business is by keeping the customer satisfied. In Bangladesh, external factors often cause unprecedented disruptions in the natural flow goods and services. This paper focuses on finding the criteria to provide the optimal level of services provided within the premises of the storage and distribution centers (warehouses). A list of criteria is formulated based on the social constructivism perspective. Respondents have been carefully selected to find an overall understanding of the present services provided by 3PL firms in Bangladesh to their clients. Voice recorded in-depth interviews were taken and an interpretive framework was develop to find the optimal criteria. In addition, various prevailing and updated literature were correlated to the preexisting scenario in Bangladesh in order to decipher the optimal criteria. The findings include ways of increasing efficiency and decreasing costs with the goal of providing the right product to the right consumer of the right quantity. Several criteria were determined in the following areas of operation of 3PL firms: warehousing, inventory management, order processing, VAS and Information Systems and transportation. Three segregation of activities (strategic, tactical, operations) were interpreted to be optimal for each of the five segments. This was done by assessing the present method of conducting 3PL activities. The framework was established through social constructivism perspective considering the respondents’ backgrounds and experiences. The conclusive idea was optimizing the in house processes as much as possible as well as taking on some of the managerial decision making burden from the FMCG producers. This will let them focus on their core activities while 3PL providers can increase their flexibility and improve services.