In the military, logistics hence refers to the movement of supplies and equipment in the war zones, which is derived from the French term ‘logistics’. Putting it simply, a freight forwarding company is dealing with the acquisition, storage, management, and transport of resources, including equipment, inventory, food, liquids, materials, and people.
In 2020, the logistics industry will have fallen to $5,200 billion from $7,641.2 billion in 2017. The COVID-19 pandemic slowed down global logistics activities in large part.
E-commerce’s unprecedented popularity has somehow led to increased demand for the 3PL (Third-Party-Logistics) and 4PL (Fourth-Party-Logistics) services.
Globally, the course of the 3PL market is yet forecast to reach a ratio of $1 trillion over the next six years, according to a report by Allied Market Research. It would be more in demand for 3PL companies to have multiple warehouse locations, making last-mile logistics more efficient.
The advantages of 3PL and 4PL include the fact that they are cost-effective, faster, and more responsive. There are disadvantages, such as lack of direct control over the logistics providers and increased reliance on them by the manufacturer.