Please enable JavaScript.
Coggle requires JavaScript to display documents.
Logistics activities classification by service level - Coggle Diagram
Logistics activities classification by service level
Third-party logistics (3PL)
Comprehensive management: Manages the execution of logistics services for each functional department on behalf of the business owner
Diverse services: Handles import/export procedures, freight transportation, combined circulation, inventory storage, and information processing
Integrated system: Integrates with the customer's system, providing higher efficiency
Advantages:
Optimize logistics processes:Professional providers manage all logistics activities.
Cost savings: No need to invest in logistics infrastructure or personnel.
High expertise: Utilize expertise and wide networks to improve efficiency.
Flexible scalability: Services can be easily adjusted to business needs
Disadvantages:
Loss of Direct Control: Complete dependence on the provider.
High Costs: Service costs may be high due to complexity.
Quality Risks: Service quality depends on the provider.
Single Partner Dependence: High risk if there are issues with the provider
Difficulty in Partner Selection: Need to choose a suitable and reliable provider.
The 3PL model is a reasonable choice for businesses that want to optimize their logistics processes and leverage the deep expertise of logistics service providers. This model is particularly suitable for businesses with large or international transportation needs.
Some 3PL providers:DHL, Gemadept logistics, Transimex, Kuehne+Nagel
Fourth party logistics (4PL)
Comprehensive integration
Design and operation
Comprehensive management
Advantages
Comprehensive management: Integrates the entire supply chain, helping to optimize logistics.
Resource Savings: Businesses can focus on core activities without having to manage logistics.
High Expertise: Ensures efficiency with the provider's advanced expertise and technology.
Flexible Scalability: Easy to adjust the scale of logistics according to needs
Disadvantages
Loss of Direct Control: Complete dependence on the provider.
High Costs: Service costs may be high due to complexity.
Quality Risks: Service quality depends on the provider.
Single Partner Dependence: High risk if there are issues with the provider
Difficulty in Partner Selection: Need to choose a suitable and reliable provider
Who is it suitable for? The 4PL model is a reasonable choice for businesses that want to outsource the entire logistics process and leverage the comprehensive management of the service provider. This model is particularly suitable for businesses with complex supply chains and seeking integrated solutions from multiple resources, but not suitable for businesses that want to maintain direct and detailed control over logistics activities.
Some 4PL Providers: CEVA Logistics, Toll Global Logistics, GEFCO, DHL Supply Chain & Global Forwarding