Fourth Party Logistics: How to save time and money

Jan 6, 2022 | Associations

As global supply chains become more digitised and interconnected, they also become increasingly complex. With the advent of wide-reaching cold-chain networks to transport COVID-19 vaccines and essential PPE to combat the pandemic, many businesses are now finding that they are struggling to maintain these complicated systems and keep up with the rest of their business activities. This is where fourth party logistics (4PL) comes in, becoming an integral and essential part of supply chain management in the 21st Century.

Unlike standard third-party logistics where the operational work is outsourced to a partner, 4PL represents a much higher level of supply chain management for the customer by proactively overseeing all aspects of the supply chain and providing strategic insight into the logistics process. In effect, the client outsources all their operations to a single partner who is responsible for assessing, designing, planning, building, running, and even tracking an integrated comprehensive supply chain solution on the behalf of the firm.

Crown Agents’ fully owned, logistics and freight-forwarding partner Greenshields Cowie delivers 4PL supply chain services across the health, humanitarian, stabilisation and renewable energy sectors, and is heavily involved in emergency cold chain and pharmaceutical logistics, including the transport of COVID-19 vaccines across the globe. Drawing on years of experience and industry knowledge, our Director of Logistics, Graeme Kelly, shares the advantages of engaging an effective 4PL provider to oversee the supply chain:

  1. A 4PL provider has control and accountability over the whole supply chain

Having a 4PL partner adds strategic oversight to a firm’s supply chain to provide the highest level of service for the best value. Outsourcing the entire supply chain to one partner may feel like a loss of control, however the opposite is true. Whilst keeping the client informed through regular status reports, the 4PL provider takes full responsibility for chasing the disparate elements in the supply chain to ensure goods are delivered on time and to the correct specifications. Having an effective 4PL system in place therefore means that the client’s firm can focus on their core competencies while the 4PL provider brings their experience to running the supply chain.

2. Utilising significant expertise developed over years of operations

When outsourcing supply chain operations, the organisation used for this task needs to be trustworthy and reliable. Therefore, 4PL providers need  to have an excellent track record in supply chain management, with expertise and knowledge you can benefit from. An effective provider offers the strategic vision to plan and operate the supply chain network in the most efficient way and can bring new perspectives when considering the logistics strategy, saving the client from making costly and time-consuming mistakes. The provider can also coordinate with a broader base of potential pre-screened suppliers than the client may have in their network, to ensure the lowest transportation costs, without compromising on quality of service.

Relying on solid project management principles will ensure that contextual challenges and operational complexities of the supply chain are effectively dealt with. For example, when the conflict in South Sudan created a large-scale refugee crisis, we utilised the control tower mechanism to quickly adapt a mass bed net road distribution programme, reaching out to local air partners within our network and loading containers on multiple flight rotations to reach the most inaccessible districts. This way, we ensured vulnerable, isolated communities could still receive protection from Malaria. We achieved this despite the challenges of impassable roads due to flooding, or the security concerns that meant some areas became unreachable.

3. Gain clear technological oversight on all aspects of the supply chain

A key element of 4PL is the technological oversight a partner will bring to supply chain management systems, providing standardization and automation of the logistics process through technological integration. Modern, complex supply chains can appear opaque without data-driven technical management and the ability to easily cut through the noise to understand all individual elements at any one time.

IT systems such as Cargowise provide a full life-cycle solution for the management of the supply chain. By utilising specific workflows and milestones, all procurement and supply chain elements can be managed and monitored – from requisition, bidding, contracting and purchasing through to shipment tracking and invoicing. Utilising the data from our systems enables us to feed into ongoing continuous improvement programmes across the supply chain to drive efficiency, effectiveness and cost savings.

When working for two large UN organisations for example, these cloud-based systems enabled us to provide a full and centralised status of all inventories and consignment milestones, as well as stock status and inventory levels at all stages of the project.

4. Apply an experienced-based solution for challenging regions

Global supply chains straddle huge swathes of the world, but complex and volatile regions still demand exceptional project management skills and grass roots knowledge.

By offering a profound understanding of the bureaucratic, environmental, and infrastructural challenges of less developed countries, 4PL can ensure supply chains run smoothly and effectively, even in fragile or conflict-affected regions. Being able to rely on a network of national authorities and service providers, global transport suppliers and cargo airlines is of crucial importance: it will, amongst others, prevent disruption to the supply chain and provide the strategic oversight you need to operate in these areas.

5. See your supply chain as an integrated whole rather than separate parts

Typically, companies choose to use 4PL when their supply chain reaches a new level of complexity that requires external support to manage. A good 4PL provider will help identify areas for improvement and develop a bespoke logistics solution while taking complex matters into their own hands, so the client does not have to worry about it.

In summary, 4PL takes away the hassle of juggling multiple stakeholders within a supply chain by acting as a single point of control and letting the client have end-to-end visibility across all geographies and stock.

Considering the current dynamic challenges faced in transporting vaccines, PPE, and other critical medical goods to combat COVID-19, it has never been clearer that effective supply chain management is the best way to maximise results, and to ensure the flow of goods around the world remains seamless, even in difficult times.

How we can help

Crown Agents’ freight-forwarding partner Greenshields Cowie delivers 4PL supply chain services across the health, humanitarian, stabilisation and renewable energy sectors. Greenshields Cowie specialises in final mile logistics and is renowned for delivering a myriad of commodities including health-related goods, humanitarian aid, vehicles, hazardous goods and construction equipment to some of the most challenging, remote and volatile regions in the world, including Iraq, South Sudan, Nigeria and Syria. In Sierra Leone, for example, this expertise, operational knowledge and local insight has helped International Aid and UN Agencies for over 20 years.

Greenshields Cowie’s end-to-end supply chain offering treats the supply chain as an integrated “whole” to improve planning, unlock performance opportunities and ensure the secure, accurate and traceable delivery of goods to those who need them. This capability makes our approach particularly appropriate for delivering pharmaceuticals and medical supplies into difficult to reach and remote areas, often within high-risk security situations.

To talk to us about our 4PL services, please contact our expert below:

Graeme Kelly
Director, Greenshields Cowie
T: +44 7825 981185