Fourth party logistics: what, why, how

This paper takes an overview of the development of the 4th Party Logistics concept. A cursory glance at today’s supply chains suggests that they are typically more challenging than in previous decades being more complex, more globally orientated, more time sensitive, more competitive and aim to satisfy more demanding businesses and end-customers. Yet, perhaps paradoxically, there are also more opportunities to be smarter in terms of technological applications, changing organisational structures and more flexible and leaner business systems. One example of this is the emergence of a new logistics entity, the 4PL or Fourth Party Logistics Provider. Although the term was coined over a decade ago and had a troubled inception it appears in some sectors to be being adopted again as a realistic supply chain solution rather than an idealistic invention. This paper takes a fresh look at the 4PL concept asking questions such as what it is, why it is attractive, and how concerns can be managed. It concludes by posing a range of questions for future research, which may also be useful for companies contemplating embarking on a 4PL initiative