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Digitization of the 3PL

Sharing the recent article by Zach Tomlinson, Tradelens on a topic that resonates with the content of GTDW China Trade Development Week around this year's theme of 'Digitalization, Standardization & Interoperability of Trade Technologies'

What is a 3PL? Third-party logistics (3PL) providers vary as widely as the industries and customer bases they serve. They can be bulk-scale freight forwarders, private couriers, fulfillment services, and many others. But what they have in common is their subcontracting role, specializing in logistics and transportation for the movement of products. At its most basic, a 3PL firm provides warehousing, shipping and distribution, but more advanced operations, known as Service Developer 3PL companies, can also offer product and data security services, product tracking and tracing, supply chain management and specialized distribution techniques like cross-docking — where cargo is immediately unloaded from one incoming shipping method, like a tractor-trailer or railcar, onto another outgoing method, which obviates the need for additional warehousing costs or inventory handling.

In some cases, a 3PL can become wholly integrated with their client company, as with so-called Customer Adapter 3PL and Customer Developer 3PL models. A Customer Adapter 3PL works as something like a consultant, taking over a company's existing logistics, shipping and distribution infrastructure, and then managing it with an eye towards greater efficiency. Customer Developer 3PL contractors, in contrast, become much more directly enmeshed within their client firm's operations, becoming essentially the company's actual logistics department, not merely consultants or managers of that department.

3PL providers differ from second-party logistics (2PL) providers, like an express parcel service, in that their services are specifically tailored to each client. As 3PL digitization progresses, this frequently means close schedule-syncing with respect to future workloads and shipping timetables, such as API integration between an e-commerce site and its fulfillment service. Naturally, ongoing developments in 3PL digitization means that advances in 3PL technology and 3PL automation are poised to radically redefine what kinds of logistical support a 3PL firm can provide (and what new expectations their clients will demand).

How will digital technology change the 3PL industry?


Join governments, ports, shipping, cargo, air, supply chain, logistics, customs & compliance leaders attending GTDW China Trade Development Week, June, Shanghai. This years theme: 'Digitalization, Standardization & Interoperability of Trade Technologies'

• Program GTDW China 2020 English:

• Program GTDW China 2020 Mandarin:

• Partnership Prospectus:

For details contact

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