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Understanding Third-Party Logistics (3PL)

Third-party logistics (3PL) providers offer outsourced logistics services including warehousing, transportation and integrated supply chain management. They specialize in customized, scalable solutions. Non-asset based 3PLs perform consulting, tracking and customer service using domain expertise instead of owned assets. Fourth-party logistics providers (4PLs) are consulting firms that use 2PLs and 3PLs to supply services while owning only IT systems and intellectual property.

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854 views8 pages

Understanding Third-Party Logistics (3PL)

Third-party logistics (3PL) providers offer outsourced logistics services including warehousing, transportation and integrated supply chain management. They specialize in customized, scalable solutions. Non-asset based 3PLs perform consulting, tracking and customer service using domain expertise instead of owned assets. Fourth-party logistics providers (4PLs) are consulting firms that use 2PLs and 3PLs to supply services while owning only IT systems and intellectual property.

Uploaded by

Vishualways
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPTX, PDF, TXT or read online on Scribd
  • Introduction
  • Overview
  • Non-Asset Based 3PL
  • Why Use 3PL?
  • The Move to 4PL
  • 4PLs
  • Advantages of 3PL & 4PL
  • Disadvantages of 3PL & 4PL

Third Party Logistics (3PL)

By
Sahil Puri (37)
Reetika Rana (35)
Overview
 A third-party logistics provider (abbreviated 3PL, or
sometimes TPL) is a firm that provides a one stop shop
service to its customers of outsourced (or "third party")
logistics services for part, or all of their
supply chain management functions.
 Third party logistics providers typically specialize in
integrated operation, warehousing and transportation
services that can be scaled and customized to customer
’s needs based on market conditions and the demands
and delivery service requirements for their products and
materials.
Non- Asset Based 3PL
 Advancements in technology and the associated increases in
supply chain visibility and inter-company communications
have given rise to a relatively new model for third-party
logistics operations – the “non-asset based logistics provider.”
Non-asset based providers perform functions such as
consultation on packaging and financial settlement, auditing,
tracking, customer service and issue resolution.

 A non-assets based provider consists of a team of domain


experts with accumulated industry expertise and information
technology assets. They fill a role similar to freight agents or
brokers, but maintain a significantly greater degree of “hands
on” involvement in the transportation of products.
Why Use 3PL?
The Move to 4PL

[Link]
4PLs
 A fourth-party logistics provider is a consulting firm
specialized in logistics, transportation, and
supply chain management. To avoid any conflict of
interest, it is important that this fourth-party logistics
provider be non-asset based, as far as logistics,
transportation, and supply chain management assets are
concerned.

 Fourth-party logistics providers use 2PLs and/or


3PLs to supply service to customers, owning only
computer systems and intellectual capital.
Advantages of 3PL & 4PL

 Flexibility in Operation.
 Reduction in cycle, reduction in man power & Logistics
operation cost.
 Improved responsiveness

 Reduction in investment on Infrastructure.


 Reasonable cost => Hiring Experts.
Disadvantages of 3PL & 4PL

 Loss of Control.
 Inhouse Manpower become idle.
 Higher Risk.

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