When deciding to use a 3PL or 3rd party logistics company, it’s a decision which deeply depends on a number of factors which may differ from each individual business. Deciding to outsource selected business functions will depend on the company’s future objectives, plans, expansion, product lines, acquisitions and so on. In operation today, there are 3 different types of third party logistic companies which many businesses may use. These include:
- Asset Based Companies
- Management Based Companies
- Integrated Provider Companies
Asset based 3PL companies generally use their own personnel, warehouses, and trucks when operating their business.
Management based 3PL companies work by providing technological and managerial functions when operating the logistics functions of their business clients, but do so by the use of the other company’s assets and don’t necessarily own any of the assets.
Integrated provider 3PL companies can be a combination of both management based companies or asset based companies which supplement their services to the client’s needs and requirements.