Contract Logistics Cost Model & best logistics Books
A contract logistics cost model refers to a framework or methodology for calculating and analyzing the costs associated with providing contract logistics services. It helps both Logistics Service Providers (LSPs) and their customers to understand the cost structure and factors that affect the price of contract logistics solutions.
The exact components of a cost model will vary by service type and industry, but here are some important factors that are often considered for contract logistics cost model:
- Labor cost: This includes labor costs for various logistics activities such as warehousing, inventory management, order processing, transportation coordination and administrative operations.
- Setup fee: This includes costs associated with renting or owning storage facilities, such as rent, utilities, maintenance, security, insurance and equipment.
- Tech cost: This includes investments in warehouse management systems (WMS), transportation management systems (TMS), tracking tools, and other technology solutions needed to support efficient operations and data management.
The entire cost of moving a product, from obtaining raw materials to fulfilling client orders, is referred to as logistics costs.
Warehousing The business models use different costing methodologies. Dedicated and stand-alone facilities would utilize a different costing model than conventional shared warehouses, which may be worked up based on transaction costs.
- Utilities & Consumables
- Administrative expenses
- Profit / Management Fee
“3 Best Logistics Books “
Global Reader’s Click Below:
- Supply Chain Management For Dummies
- Value Stream Mapping: How to Visualize Work and Align Leadership for Organizational Transformation Hardcover
- The Toyota Way: 14 Management Principles from the World’s Greatest Manufacturer