by Oliver B. Schmid at 4954 IT Consulting, LLC;

You most likely have heard about 3PL Providers or Third Party Logistics Providers and wondered whether it would worth to consider and what benefits it provides? Or what even is a 4PL?
In the high pressure and fast moving Supply Chain Environment of today’s times 3PL Outsourcing has become a viable option for many distributors. 3PLs have led the way in logistics outsourcing. The core business of 3PLs spread into the areas of warehousing, distribution and supply chain control management. Suppliers that are forced more and more to reduce cost, while improving efficiencies are going more and more the way outsourcing their warehousing and distribution, including return-distribution, to these 3PL providers. A chore in itself can be finding and selecting the right 3PL partner. Some 3PL have not completely stepped up to the to meet the exact needs of its customers.
Many 3PL that have stepped up to the table to meet customer demands and requirements have migrated more into a 4PL provider relationship. As a typical 3PL warehouses your good and is responsible for the distribution, demands on see-through supply chain visibility and the request for more timely information has pushed some of the old-style 3PL to become 4PL providers.
A 4PL does not only handle your physical goods, but manages the whole business process, while providing its customers with the complete visibility of the complete supply chain process and flow at all times.
Integrating 4PL back-end-systems with the back-end-systems of its customers has become even more crucial. Users of a 4PL can focus on core competencies and better manage and utilize company assets and resources, as to inventory and personnel.

A recent study (2008) by the Circle of Logisticians at the Alumni Club of the Logistics Institute Asia-Pacific came up with the following key results:

  • 89% of 3PL users view the relationship with their providers as providing a strategic competitive advantage for their companies. Yet, even as value of services outsourced has increased, the proportion of total logistics spend has remained about the same over the years.
  • 75% of 3PL users rely on their providers for integrated services. Others do not due to factors such as fear of loss of control.
  • 86% of respondents agree that that green supply chains are somewhat important or important today. However, there is some uncertainty for some companies as to how they should proceed and what the exact benefits are.
  • 76% of respondents are generally satisfied with th security of their 3PL’s services, but there is still a gap between users’ and 3PL’s expectations.

Having setup and worked with multiple (5) 3PL and 4PL providers over the last 10 years, I can assist you in evaluatingyour 3PL or 4PL oustourcing requirements and support you in finding the right provider with the best service for your needs.

Please contact me for a free one hour consultation by calling (770) 776-6182 or by sending me an email to <a href=”mailto:oliver.schmid@4954itc.com?subject:Free One Hour 3PL Outsourcing Consultation”>oliver.schmid@4954.itc.com</a> with the subject line: Free One Hour 3PL Outsourcing Consultation.

More information about 3PL and 4PL Outsourcing can be found at:

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