Logistics management is an extremely crucial part of the supply chain, as it ensures the efficient and effective distribution of goods across the world. With so many different areas of logistics management, it can be confusing to understand what each area means and which type of logistics management is best for your business.
Using our expert knowledge, we have put together this helpful guide which has all you need to know about logistics and the different types of logistics management. Got a question or need help with your logistics? Get in touch with our team on 01293 554620 today and we’d be happy to help you.
Types of logistics provider
There are five main types of logistics provider:
1PL – First Party Logistics
First party logistics providers are businesses or individuals that import and export goods themselves, usually this is done by a member of staff in house.
This method is used instead of outsourcing to a dedicated logistics company. It might appear to be an efficient method of handling requirements but can be labour, time and resource intensive and requires staff with specialist knowledge and experience.
2PL – Second Party Logistics
2PL providers refers to those who actually own the modes of transportation. This includes aircraft, ship and lorry owners. These means of transport are then used to move goods from one place to another, either across the country or across the world.
3PL – Third Party Logistics
If you’re looking for someone to look after all aspects of the supply chain, then choosing a third party logistics company is your best option. Outsourcing this will ensure distribution, supply chain and customs regulations are all looked after, saving you time and money.
4PL – Fourth Party Logistics
Fourth party logistics providers are very similar to 3PL’s – you can outsource your logistics to them for a full supply chain management service. However, they differ slightly as they use all of their own technology, so can offer a far more strategic and bespoke service.
5PL – Fifth Party Logistics
5PL companies tend to be favoured by those in the e-commerce sector. They develop and implement a whole bespoke network for companies and organise everything effectively to ensure efficiency and customer satisfaction.
Types of logistics management
Supply chain management
Supply chain management is one of the largest parts of logistics and involves the full door to door management, procurement, sourcing and distribution of goods to ensure they get from A to B in a timely and efficient manner.
This is done through collaboration with various channels across the logistics industry and needs forward planning to ensure goods are delivered on time, keeping customers happy.
Freight forwarding companies are dedicated to finding the most efficient, effective and affordable ways to get goods from one destination to another. The majority of these companies don’t actually handle any of the freight, but instead deal with all the companies that do and have close relationships with ports across the globe, as well as expert knowledge of documentation and rates.
Warehousing and distribution
This involves directly storing the goods correctly and securely at dedicated warehouses and then distributing them to their correct locations across the world using the right form of freight. Depending on where the goods need to go, this can be air, sea or land freight.
Typically, goods will have tracking so the customer and the sender are able to accurately find out where the goods are and timelines for delivery. All goods will need to be packaged correctly and come with the right documentation to ensure swift transportation.
Production logistics refers to the management of different supplies, parts and stages of a product coming together in one place to be assembled, ready to be distributed as a finished product.
This involves a lot of coordination and organisation to ensure that all the goods arrive within the same timeframe, to avoid delays further down the line.
Reverse logistics companies are companies that are dedicated to dealing with the returns of unwanted or unused products from customers back to the manufacturer or business itself.
This is a fairly new form of logistics management, but is becoming increasingly popular to deal with the growing demand of online shopping and returns.
How Seaspace can help
Seaspace International is 3PL and can help with all aspects of your supply chain to ensure efficient shipping of goods across the world. As well as this we offer a range of helpful services that will save you time and money by outsourcing to us:
If you’d like more information about how we can help your business with its supply chain, freight forwarding or storage of goods, get in touch with our team today. We’d be happy to provide you with a free quote and to help understand how we can add value to your business.