??? UNDERSTANDING THE DIFFERENCES BETWEEN 1PL, 2PL, 3PL & 4PL

Here's a simple breakdown of each logistics level:

1PL (First-Party Logistics)

• The company handles everything internally — from storage to transport and delivery.
• Example: A farmer delivering their own produce directly to customers using their own truck.
• ? You control everything
• ? High cost, limited scalability

2PL (Second-Party Logistics)

The ??? Understanding the Differences Between 1PL, 2PL, 3PL & 4PL

• company outsources the transport to a carrier or freight company but still manages the rest (like warehousing or customer service).
• Example: A manufacturer hires a trucking company to move goods between factories and stores.
• ? Lower transport burden
• ? Still needs in-house coordination

3PL (Third-Party Logistics)

• The company outsources transportation, warehousing, and sometimes order fulfillment to a logistics provider.
• The 3PL manages day-to-day operations like inventory storage, picking, packing, and shipping.
• Example: An online retailer using a 3PL like DHL, Toll, or DB Schenker to store and ship products.
• ? Flexible, scalable, cost-effective
• ? Less control, dependent on provider performance

4PL (Fourth-Party Logistics)

• The company hires a strategic partner (the 4PL) to oversee and integrate the entire supply chain, including managing multiple 3PLs.
• The 4PL focuses on optimization, coordination, analytics, and technology rather than physical logistics.
• Example: A 4PL like Accenture or CEVA Logistics managing all transport, storage, and IT systems across multiple vendors.
• ? Full visibility, efficiency, and strategy
• ? Higher cost, requires strong trust

?? Summary Table

Finding the Right Logistics Model

The logistics models — 1PL, 2PL, 3PL, 4PL, and 5PL — differ mainly in two areas: the level of integration between the client and the logistics provider, and the scope of services offered.

While 3PL (Third-Party Logistics) remains the most common and proven model for businesses with established supply chains, 4PL and 5PL represent the next generation of logistics solutions — offering deeper collaboration, digital integration, and enhanced efficiency through automation and data-driven optimisation.

At Loch M Fraser, together with our international partners, we offer a range of logistics models tailored to meet the unique needs of every customer. Whether you require traditional freight management or a fully integrated supply chain solution, our team will work with you to identify the model that best supports your business goals.

Contact us today to explore which logistics model is right for you.