WHAT ARE YOUR LOGISTIC SOLUTIONS ?

With pandemic leaving us caged at home for unimaginable times, we are grateful for all those who are on their toes to make sure, customers are getting their orders delivered at doorstep. As you wait for your delicious food, for the brand new phone or the fresh book that your friend suggested, there`s A LOT going on behind the scene.

As a MBA candidate, willing to work in a big companies or want to establish your own venture, let`s get into in depth of one of the important concept – LOGISTICS! Known as a massive chain network, logistics is a detailed organization responsible for carrying out various delivery and shipment related operations.

The rise of e-commerce has made a significant contribution in a world economy and so did these logistics. Without logistics, a concept of e-commerce could have never been possible to be implemented. This blog explains different types of logistics available like 1PL 2PL 3PL 4PL 5PL and how they are unique in their own way.

1PL: 1st Party Logistics

The 1st party logistics to referred to a firm or individual, that has their own cargo, freight and can transport goods and merchandise from one point to another point. They are the specifically the consignor of different goods and products and organizes the transport of products to their respective destinations. It mainly consists of two parties that get benefit from the transaction, the manufacturer or the supplier and the person buying it. There are no other middlemen involved in the whole process.

2PL: Second Party Logistics

A 2nd party logistics involves transport of goods from a particular transport area of the supply chain like rail, road, sea or air. They are the asset-based carriers and includes like transport using ships of own lease and airlines that they are contracted with.

Applications: International transportation of heavy, wholesale goods and for trading purpose

 3PL: 3rd Party Logistics

A 3rd party logistics is a supply chain that primarily concerns the transportation and delivery of different products but also includes various types of additional services as well. 

The functions of 3PL include warehousing, terminal operations, customs brokerage, supply chain management and many more. It also includes logistics IT software products and analysis services, for tracking and tracing the delivery status of different products. These 3rd party logistics delivers all the above-mentioned services and also manages various obstacles that come in the way.

Application: Domestic, offshore warehousing, other supply chain management systems.

4PL: 4th Party Logistics

Among the 1PL 2PL 3Pl 4PL and 5PL, the 4th party logistics is a new concept which is coming into the market, and it involves employing an overseer for managing an entire supply chain of a company. These logistics are often called Lead Logistics provider and they are often treated as a consulting company for many supply chains. They act as a head administrator and takes care of every aspect of these supply chain companies.

 They are frequently contracted with many 3rd party logistics and for maintaining neutral management and for providing feedback regarding various 3PL logistics services. With increased efficiency 4PL is becoming the next big thing in the logistics sector. They provide a single invoice solution and streamlines logistic work like no other.

5PL: 5th Party Logistics

A fifth party logistics provider is also known as a logistics aggregator. They will aggregate the demands of the 3PL and others into bulk volume for getting better rates with different types of airlines and shipping companies. This type of logistics is not asset based. It usually works seamlessly across all disciplines.

These are the basics of Logistic options and hope it helps.