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4PL

4PL

18 Jul 11:00 by Alex Dobson

4PL Logistics - explanatory diagram

I know I haven’t written a blog for a while. This is due to being very busy (not that I should use that as an excuse) such as working on roles (ok, I could have written a blog between times), going on holiday (writing a blog when watching David Guetta at Ushuaia wasn’t an option, sorry) and helping with the rebrand of our company from SLS Services to Next Phase Recruitment (hmm ok I could have written a blog about this). Aside from these poor excuses (aside from the David Guetta one), what triggered me to write this blog was when I was speaking to a candidate which led me to looking into one of the companies he worked for. As I went onto the company's website I saw a paragraph relating to Fourth Party Logistics. 4PL? I have been recruiting in the Pharmaceutical Logistics, Supply Chain and Warehousing sector for just under a year and built a desk up from scratch within the field. I definitely don’t begin to call myself an expert or anything close to this, but I like to think I know the difference between GDP and WDA. However, 4PL really stumped me and showed that you learn something new every day.

So what is 4PL?

At a first glance my initial thought was it must be an add on from 3PL and this was a well-placed educated guess. A good starting block for defining this and where 4PL fits is the table at the top of the article↑

The main synopsis I picked up with that 4PL companies focus on procurement, storage, distribution and processes. They take on the logistics section of the business, which could include the whole process or a small part of the logistical set up. 4PL companies are often known as “Lead Logistics Providers” and their role is to provide a broader scope for managing the entire supply chain. In other words they incorporate the roles of 1PL, 2PL, 3PL and 4PL. These kind of organisations are not as common as 3PL companies as being part of the Supply Chain is a costly expenditure for any company. However, if a company is looking to outsource their supply chain then it makes sense to give this to a 4PL company so they can run the entire process. This really highlighted to me what outsourced party logistics companies could handle from organisations and the range of options open to organisations.

On a side note 5PL (incorporating the companies e-business operations) is on the rise as well but let’s leave it at that for the time being.

Sources- http://cerasis.com/2013/08/08/3pl-vs-4pl/ & http://www.cquential.co.za/industries/3pl-4pl/