4 PL logistics is also known as fourth party logistics. It is a type of business model. In which businesses give their logistics and their entire supply chain management to an external service provider. This source of logistics is mostly use by manufacturers. This external provider will be responsible for all the logistic solutions. That will be provided to the customers. His responsibility includes all supply chain management activities. Like designing, building, running, assessing and also calculating solutions for the customers. Partner controls and manages the supply chain on the behalf of their clients. This includes taking care of shipping companies, freight, and a combination of warehouses and agents. 

Advantages of 4 PL logistics

Experience in powerful data visibility

Fourth party logistics uses advanced softwares and data analysis tools. For providing logistics measurements and solutions. And also provide a unified version of the truth. This is a complex process , and even a delay or error in this can pause the whole operation of the supply chain. Mechanism by which 4 PL logistics provider solutions is  Aggregate enterprise data. Because of this mechanism fourth party providers gain the whole view of the whole control system. The main benefits of the 4PL system is that. It analyses  all the data without taking away the focus from the main business.

Reduce the 4 PL logistics complexity 

Between your business and multiple suppliers and logistics providers. Fourth party logistic providers act as a wall. This reduces the complexity of the process. And provides a greater vision of the whole supply chain. Advices provided by the 4 PL logistics can help to improve and to be in a  continual process. Fourth party provider gives a solution that finishes the problem from its root cause.  

Operational Efficiencies

Fourth party providers provide solutions that are operationally effective. There services are 

  • Order tracking and placement
  • Access to a large amount of quality suppliers
  • Excellent forecasting for raw material needs and its amount. And also tell the production schedule.

Money Saving

If you hire a fourth party logistics provider, then you have to give them some incentive. But the cost of incentive is rather less expensive than the cost of operation. This separate logistic providers from fourth party logistics providers.  We can save money because of these elements. Like less inventory burden, lower overhead and low cost labour. There is no wasteful process, because we hier fourth party logistics. It also expands the supplier base, which leads to improvement in purchasing leverage. 

If you have optimised your supply chain, then it gives your business greater flexibility. This means that your company can change or adapt easily. If there’s any dynamic change in the market. 

Disadvantages of Fourth Party Logistics        

If you are hiring fourth party logistics. This means that you have very less control on logistics and  the fulfilment process of the product. But this is also an advantage if your company doesn’t have any logistics experts. 4 PL logistics are expansive or not cost effective for small businesses.

Logistics also helps you to chose which mode of freight you can use.

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