A fourth-party logistics (4PL) is a supply chain services provider that manages the design, build, run, measurement and orchestration of all or part of an end-to-end logistics network for a fee. It coordinates logistics operations via internal and/or external parties, delivering visibility, management control and optimization through an integrated technology platform. Growth in 4PL spans enterprises of all sizes across various industries, as integrated supply chains support business growth. Underutilized logistics partnerships are extending to manage other supply chain functions like procurement, risk management and capacity planning. Technological advances like AI and predictive analytics are driving increased demand for efficient supply chain operations.
Gartner defines a third-party logistics (3PL) provider as a logistics service provider that moves, stores and manages the flow and distribution of products and materials on behalf of its customers for a fee without taking ownership. The 3PL will typically provide and manage operations that must include warehousing, transportation or value-added services that can be scaled and customized to the shipper’s needs. 3PL providers solve the challenge of efficiently managing the movement, storage and distribution of goods by enabling companies to outsource complex logistics operations, thereby reducing operational costs, improving supply chain visibility and supporting business scalability.