In this increasingly volatile business environment, logistics providers continue to look for ways to define themselves and deliver best-in-class services. But a lot of times these attempts at differentiation lead to confusing jargon and acronyms that continue to be built upon year after year.
A few years ago I wrote a post to help distinguish the difference between 1st, 2nd, 3rd, and 4th party logistics. The other day I read a great article in DC Velocity that claimed there was a consultant out there that was trying to define “5th party logistics”.
The latest jargon that is now gaining adoption is that of the Logistics Service Provider and Lead Logistics Provider
Logistics Service Provider – An LSP is really what most people would see as a traditional 3PL provider offering a combination of warehousing and transportation services or one or the other. As global and multi national providers enter the game, things have certainly changed, but the Logistics Service Provider at its core is fundamentally the same.
Lead Logistics Provider – An LLP is the new term that consultants now more frequently use instead of 4PL. At the most basic level a Lead Logistics Provider is nothing more than a Non-Asset Based 3PL, but there is certainly an emerging field of logistics providers that oversee and manage a portfolio of warehousing and transportation providers from a higher level.
At the end of the day you can call 3PL providers whatever you want but its still about storing and shipping things.