Introduction
The literature review was conducted from publications that are not older than 2016 to reveal that third-party logistics providers can improve the aviation industry’s supply chain. It stipulates the advantages and Future of the partnership of the 3PLs and the aviation industry’s chain supply.
The topic is essential because the aviation industry is experiencing extensive pressure to make profits. The emergence of Covid-19 has further made the industry experience low profits due to travel restrictions imposed by various countries to curb the spread of the virus. However, third-party logistic providers have partnered with supply chains in the aviation industry to meet the demands.
Research Question
How can third-party logistics providers improve supply chains in the aviation industry?
The paper is organized in a detailed manner, and it begins by providing a general overview of the problem before it discusses the advantages and future of the engagement.
Review of Literature
Logistics is an integral part of the current society as globalization is on the rise. It entails packaging, warehousing transportation, materials handling, inventory control, and order processing (Li & Chen, 2019). Therefore, third-party logistics (3PL) providers have partnered with supply chains in the aviation industry to enhance efficiency and customer satisfaction.
Advantages of Third-Party Logistics in Supply Chain Management
There are numerous advantages of engaging third-party logistics in supply chain management. For instance, 3PL helps in reducing on-hand inventory (Rashidi, 2020). It can provide more space by packaging and storing the useable materials in a close supplier store. According to Li and Chen (2019), 3PL can improve efficiency by enabling outfitting solutions to consolidate various components in a unit and deliver them to a specific point. Research conducted by Rashidi (2020) demonstrates that outfitting services allow aviation workers to concentrate on other crucial tasks. Hence, the actions can help the supply chain industry to reduce expenditure.
3PLs also improve cashflows when they are involved in the aviation industry. They store the inventory purchased and transport them to whichever place is required, which enhances cashflows (Li & Chen, 2019). They can also procure stock on behalf of the company and only deliver the parts when needed.
3Pls can also help in adopting sustainable strategies and extensive innovation. Cigolini, Pero, and Sianesi, A. (2016) illustrate that they can reduce environmental pollution and road congestion. Moreover, Li and Chen (2019) believe that it helps the aviation industry to save on the cost by installing a Global Positioning System (GPS) and Intelligent Transport System (ITS). Sremac, Stević, Pamučar, Arsić, and Matić (2018) concur with this notion by demonstrating that 3PLs have invested heavily in the innovation activities that improve the logistic activities in totality. Therefore, they help the business to save on costs while adapting to sustainable programs.
The Future of 3pls in Supply Chains in the Aviation Industry
Innovation is one of the key issues that will affect the future of 3PLS. Baryannis, Validi, Dani, and Antoniou (2019) reveal that 3PL heavy investment in artificial intelligence will improve supply chains in the aviation industry. Numerous automation activities will be involved to reduce cost, and time and make the whole process efficient.
“Uberization” will also be critical to the growth of 3PLs, especially in the aviation industry. The increase in digitalization and e-commerce has created a new business model for mobile applications (Gurina, Rumyantseva, Liberman & Shchetinina, 2020). This means that mobile and freight apps will widely be engaged.
3PLs have modified their business models to adapt to environmentally friendly activities. The future’s most significant innovation is minimizing carbon emissions and enhancing sustainability (Liu, Qian & Wang, 2020)). Environmental sustainability will influence 3PLs improvements in the supply chains in the aviation industry (Klumpp, 2017). With the increase in innovations, the providers will identify efficient ways that will not cause harm to the environment.
Findings
3PLs play a crucial role in improving the supply chain in the aviation industry. The 3PLs help the chain supply by promoting innovative activities that lower expenditure costs.
Conclusion
From the literature review, it is evident that third-party logistics providers can improve supply chains in the aviation industry by reducing the hand inventory, providing packaging and storage activities to offer more space, and providing outfitting solutions. They can also enhance supply chains in the aviation industry by investing in innovative activities.
References
Baryannis, G., Validi, S., Dani, S., & Antoniou, G. (2019). Supply chain risk management and artificial intelligence: state of the art and future research directions. International Journal of Production Research, 57(7), 2179-2202.
Cigolini, R., Pero, M., & Sianesi, A. (2016). Reinforcing supply chain security through organizational and cultural tools within the intermodal rail and road industry. The International Journal of Logistics Management, 27(3), 816-836.
Gurina, M. A., Rumyantseva, Y. V., Liberman, T. I., & Shchetinina, I. S. (2020). Leaders of change key strategic instruments: Marketplaces as the basis of the uberization model for managing global companies. International Transaction Journal of Engineering, Management, and Applied Sciences and Technologies, 11(3), 1103-1103.
Klumpp, M. (2017). Do forwarders improve sustainability efficiency? Evidence from a European DEA Malmquist Index Calculation. Sustainability, 9(5), 842.
Li, S., & Chen, X. (2019). The role of supply chain finance in the third-party logistics industry: a case study from China. International Journal of Logistics Research and Applications, 22(2), 154-171.Web.
Liu, X., Qian, C. and Wang, S. (2020), “When do 3PLs initiate low-carbon supply chain integration?“, International Journal of Operations & Production Management, 40(9), 1367-1395.
Rashidi, K. (2020). Ahp versus dea: A comparative analysis for the gradual improvement of unsustainable suppliers. Benchmarking: An International Journal, 27(8), 2283-2321.
Sremac, S., Stević, Ž., Pamučar, D., Arsić, M., & Matić, B. (2018). Evaluation of a third-party logistics (3PL) provider using a rough SWARA–WASPAS model based on a new rough dombi aggregator. Symmetry, 10(8), 305.