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3PL vs 4PL
Many 4PLs subcontract with numerous 3PLs warehouses, while 4PLs often do. That means
to create supply chain flexibility and improved that 4PLs (or a fleet-owning 3PL) can sometimes
performance, giving them access to a huge provide more flexibility and stability when it’s
range of services that can be easily scaled. most critical.
What’s more, 4PLs provide a single contact A 3PL keeps the client in the driver’s seat,
point for an entire supply chain, reducing the so to speak. For businesses that want more
need to work with a multitude of consultants control over their supply chain strategies,
and logistics providers. 3PLs typically o er more visibility on the
client end. But for those ready to relinquish
4PL drawbacks some control, 4PLs can elevate your logistics
On the other hand, the cost of a 4PL is often performance.
substantial due to the number of services it Businesses with large, complex supply chains
provides, potentially putting it out of reach can often benefit from using a 4PL to provide
for many SMB shippers. Additionally, the basic a logistics ‘nerve centre’ with the resources to
trade-o of the 4PL is giving up some control coordinate all of the moving parts.
in exchange for its expertise. Some 4PLs also Whichever system you choose for your
may not o er the fine-grained supply chain business, remember that due diligence is
control and transparency that many businesses critical. Any logistics partner that a business
demand. works with should have all appropriate
certifications (including hazmat certificates if
Which is right for your business? necessary) and carry appropriate insurance
The right logistics solution for your business is and surety bonds. These are key requirements,
the one that fits your needs and your budget. so any provider that hasn’t taken the time to
For anyone thinking 3PL vs 4PL, here are some put them in order should be avoided.
factors to take into account: Both 3PLs and 4PLs are cornerstone
A 4PL typically costs substantially more than elements of the logistics landscape today. By
a 3PL since its services cover more parts of the knowing the di erences between the two and
supply chain and include strategic planning and evaluating each on its merits, you can find a
management services. better way forward for your logistics and a
Many 3PLs don’t own their own fleets and/or package of options that suits your needs. •
April 2021 | Logistics News 17
