In what all ways is 4 PL different from 3 PL in terms of their meaning and scope?« Back to Questions List

Third party logistics abbreviated as 3PL is the firm that provides multiple logistics services for the use of customers. These services are integrated together by the provider. The 3PL may or may not own all the features that it provides, but it coordinates and manages all of them, being a single contact point for the service seekers. With the growing market and competency, the product manufacturers and traders prefer to focus on their expertise and core job and the logistics function is outsourced to its experts, and here comes 3PL into play. The services provided by a 3PL are transportation, warehousing, cross-docking, inventory management, product packaging, freight forwarding, distribution/deliveries and IT support for the whole business.

Fourth party logistics abbreviated as 4PL is an aggregator that assembles the resources, planning capabilities and technology of its own organisation and other organisations to design, build and run comprehensive supply chain solutions. When a company outsources its different services to more than a single 3PL, maybe on the basis of their expertise on the types of logistics, i.e. inbound/outbound, then in order to manage these 3PLs, a single contact point is appointed, such a firm is referred to as 4PL.