Logistics is an essential issue that manufacturers, suppliers, retailers and those involved in supply chain cannot but deal with.

In the business of product manufacturing, purchase, and supply, logisticsis a major issue. This is an issue that has covers the movement and distribution of goods from the supplier to the retailer and its final destination which is the consumer. Logistics is generally the detailed organization and implementation of a complex operation. In a general business sense, logistics is the management of the flow of things between the point of origin and the point of consumption in order to meet the requirements of customers or corporations. Logistics in many situations cover storage and transportation. Due to the technicalities and the requirements for logistics, many companies outsource their logistics needs.

The outsourcing of logistics can be to third party and fourth party logistics companies. Third party logistics handle the logistics themselves with their equipments and facilities. However, fourth party logistics companies outsource aspects of logistics out to other companies. For instance, if the products require cold storage, they outsource the storage to companies with cold storage facilities.

A logistics company basically deals with the management of the movement and storage of products. A logistics company is outsourced to by companies who engage in manufacturing, distribution, procurement and other products related activities. For instance, a fast food production company may need a large warehouse to store one of the vital ingredients in the making of the food. It can thus contract a warehouse facility operator to have the item stored for a while.

Transportation has always been a big issue. It is how the goods will get to the retail outlets and distribution stores. Many production companies find it cheaper to outsource their transportation jobs to transportation agencies. These agencies in turn put trucks to use in getting the products to retail and distribution outlets. Many other big production companies own their distribution trucks and employ drivers but these have not reduced the rate of transportation outsourcing in recent times. It has been noted that about 80% of all Fortune 500 companies, as of 2014, used some form of third – part logistics.

Fourth party logistics companies are non asset logistics management and executive companies that take over the whole issue of logistics from a company. They work as an aspect of the company even though they are independent contractors who incorporate as a different company. They ensure the seamless storage and transportation of the merchandise to the designated points. However as the scope of logistics is very wide, some logistics companies may specialize in  air freight or shipping while some others may pitch their business tents with storage.

It is however important to note that a fourth party logistics company is basically a logistics management company. It can be likened to a logistics department in a company. However, because they are non asset, they have to outsource to get the job done. Ironically, they are also outsourced to by the manufacturing company.