{"id":12463,"date":"2021-07-22T12:37:03","date_gmt":"2021-07-22T19:37:03","guid":{"rendered":"https:\/\/michaeljbrumm.com\/dclcorp-phase2\/?p=12463"},"modified":"2021-07-22T12:37:03","modified_gmt":"2021-07-22T19:37:03","slug":"difference-between-2pl-and-3pl","status":"publish","type":"post","link":"https:\/\/michaeljbrumm.com\/dclcorp-phase2\/blog\/3pl\/difference-between-2pl-and-3pl\/","title":{"rendered":"What is the Difference Between a 2PL and 3PL?"},"content":{"rendered":"

Most people have heard the term third-party logistics (<\/span>3PL<\/span><\/a>), but there are actually many other types of companies that can offer various logistics solutions. One of those is known as 2PL, or second-party logistics. 3PL is when a company outsources elements of their supply chain, including distribution, warehousing, and fulfillment to third parties, while a 2PL is the actual carrier, such as shipping lines, airlines, freight forwarders, etc. 3PLs provide integrated fulfillment, warehousing and transportation services which can grow along with your business and scale depending on the customer\u2019s requirements. While the use of 3PL providers has been prevalent in businesses for years among larger companies, the use of 3PLs is on the increase for small to medium-sized businesses as the growth in <\/span>ecommerce fulfillment<\/span><\/a> continues to skyrocket. In organizations of this size, operating their own fulfillment, warehousing and distribution services is usually far more costly than using a 3PL that can provide on-demand services that scale with market demands.<\/span><\/p>\n

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The Importance of Logistics Companies in Ecommerce<\/span><\/p>\n

Ecommerce simply wouldn\u2019t exist without logistics companies that could handle all of the industry\u2019s fulfillment and shipping requirements. Brick and mortar companies have their own supply chains they can rely on to bring goods to their stores, but ecommerce companies have to deliver their goods straight to the customer. Companies like Amazon have made same-day delivery an industry standard that most customers now expect. These capabilities are simply beyond the scope of most ecommerce companies to handle on their own, which means they have to partner with an outside logistics provider.<\/span><\/p>\n

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Second-Party Logistics or 2PL<\/span><\/p>\n

When shipping and storage activities are outsourced to an external logistics service provider, this concept is called 2PL. A company which has been engaged to provide these services would then be called a 2PL operator or second party logistics service provider or carrier (if it involves only the transportation aspect). 2PL operators own and manage their own assets, such as its own warehouse and a fleet of vehicles. The services rendered to clients are limited to one part of a supply chain without including integrated logistics solutions. Often they are transport companies which specialize in a particular segment or transport area. For example, ocean freight or railway transport. The vehicles used may be leased or owned by these companies. 2PL operators are mainly used for international transportation of heavy and wholesale goods, as well as in international trading.<\/span><\/p>\n

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2PL Pros<\/span><\/p>\n

Pros of 2PLs include the following:<\/span><\/p>\n