Anyone looking for a logistics partner will soon come across the term 3PL. It stands for third-party logistics: you outsource your logistics to an external party. To understand what a 3PL does, it helps to know the whole range.
1PL, 2PL, 3PL and 4PL
- 1PL (first-party logistics): you do everything yourself. Your own warehouse, your own staff, sometimes your own vans.
- 2PL (second-party logistics): you handle storage and packing yourself, but outsource transport to a carrier, such as a parcel service or a pallet carrier.
- 3PL (third-party logistics): you outsource storage, order processing and shipping to one partner. Often with extra services, such as returns processing, kitting or labelling.
- 4PL (fourth-party logistics): a party that orchestrates your entire supply chain and in turn works with various 3PLs and carriers. Mainly relevant for large companies.
Is a fulfilment partner a 3PL?
Yes. A fulfilment partner is a 3PL that focuses on processing and shipping orders, often for webshops. The difference is mainly the focus: a traditional 3PL tends to work with full pallets and large volumes for industrial customers, a fulfilment partner with many small orders. For SMEs that ship both parcels and pallets, a partner that can do both is the most practical. Also read what is fulfilment?
When is a 3PL worth it?
- You no longer have the space or people to ship yourself.
- Your volumes fluctuate strongly, for example due to seasons or campaigns.
- You want to supply retailers, with requirements that are hard to meet yourself.
- You want to turn your fixed costs for warehouse and staff into variable costs.
What to look for when choosing
A 3PL becomes an extension of your business. Your customers notice immediately when something goes wrong. So don't just look at the price, but also at availability, experience with your type of orders, integrations with your systems and the terms for leaving. You'll find a checklist in 7 signs it's time to outsource fulfilment, and how to compare prices in what does fulfilment cost?
Sendwit is a 3PL for Belgian SMEs with complex orders, with one dedicated contact person and contracts you can cancel monthly. Get a price quote.