Trying to choose the right service provider for the transport of your goods? While exploring your options, you may have come across the term 4PL when service providers explain their services. Just what exactly does 4PL mean?
Differences Between 3Pl & 4PL
When looking for a freight forwarder in Calgary, you’ll have likely come across the terms 3PL and 4PL. The PL acronym simply stands for party logistics. This means a 3PL is a third-party logistics provider and a 4PL is a fourth-party logistics provider.
Now, what are the differences between the two? A 3PL company is a company that has a fleet of trucks to transport your goods. They will handle your labeling and packaging and then load them to the trucks so that your goods can be delivered to the stores/partners.
A 4PL does the same thing but also handles the logistics. You are basically outsourcing the entire supply chain. So if you manufacture a product and ship it to various retail chains, the 4PL company will know when to produce more products or hold back on production.
The 4PL helps connect the manufacturer to the retailers. They act as a single point of communication between all parties involved. They will have the data to ensure that your production is being done in an optimal manner.
Benefits of 4PL Freight Forwarders in Calgary
There are several benefits of going with a 4PL when looking for a freight forwarder in Calgary. First, a 4PL company will ensure that sales do not stagnate due to delays in production and shipment. You will minimize lost sales due to products being out of stock.
Second, you will have to deal with less inventory. Since the 4PL will have data on the inventory of retailers, you can avoid overproducing and ensure you don’t have to deal with excess inventory. Excess inventory can eat into profits as you may have to unload it for a lower price for other products.
Third, you will be able to free up more cash flow. You won’t waste cash flow on overproducing goods. You’ll make sure sales are cohesive. You’ll avoid mishaps in the supply chain that can tie you up.
Overall, a 4PL plays an extra role in managing the supply chain. This can be incredibly beneficial to many different companies and should be sought after if you have challenges managing your organization’s supply chain.
Ocean-Air Freight Ltd is your premier logistics and freight forwarder in Calgary. Since 1990, we have been providing individuals and companies with top-quality shipping and freight forwarding needs. We pride ourselves on our professionalism, experience, and adaptability. We offer a range of services including air, ocean and surface freight for international, cross-border and domestic needs, cargo insurance, import and export needs, documentation, etc. From Europe to North America, we can handle all your deliveries and freight requirements. For the best freight forwarder in Edmonton, Calgary and Saskatoon, contact our logistics company in Calgary today.