The difference between 3PL and 4PL is that a third party logistics company handles your shipments, orders, and packing while a 4PL company handles your supply chain. This is just a simplified version of the official definition and it is a good starting point for you to understand the main point of these services.
The third party logistics companies receive, handle, store, and deliver your products. The 3Pl companies do all of these services under your business name and not theirs. The third party logistics companies also provide warehousing, packing, inventory management, and much more, depending on the specifications and needs of your business and what both parties agreed on when signing the agreement. The most important consideration you need to keep in mind is that with a 3PL, your business is still manageable. But, if you want to have more information on What is a 3PL? When should you enlist a 3PL company in Australia? The types of Third-Party Logistics providers in Australia, and much more, click here.
The 4PL companies offer the same things a third party logistics company offers including managing the overall supply chain, legal paperwork, managerial decisions, and etc. When you sign a contract with such a company, you are signing over a complete control of your supply chain. In other words, the 4PL will use their resources to make sure the supply chain is properly maintained and the business needs are met. You have no control over the supply chain or any daily processes. This can be both bad and good thing. The good thing is that you’ll have more time to deal with your business, your customers, and work on promoting your brand. The bad thing is that you have no control over what is happening with your orders, packaging, and shipping.