Logistics services, courier services and carrier services are all interconnected but don’t all don’t mean the same thing. These terms are mistakenly used interchangeably but this article will focus on the main differences between a courier and logistics company. Understanding the differences would help you decide how to cut cost of transportation.
What is a courier company?
A courier is a company or person that delivers mail, valuable documents and small packages that are 150 lbs or less to someone who lives locally, the country or internationally.
Courier services are preferred over a post office at times because they are very fast, efficient and almost always have door to door service. Residential and business clients use courier companies because they offer premium services that include custom delivery deadlines from a few hours to a few days, tracking and signature service, which is why it is more expensive than the post office.
Businesses may send letters and contracts to their clients with a courier because they are reliable and more efficient than large parcel companies.
some other benefits of courier services:
- Same day delivery: This deadline is guaranteed.
- Saves money: They mainly charge by the distance over the weight. There is not a significant cost difference between sending an 8 lb package over 18 lbs.
- 24-hour service: Packages can be delivered any day of the week, not just during business hours. A team of professionals handle the packages and if there is something that happens to the package on transit, someone will be dispatched about your order.
- Personalized customer service: Customer service agents are able to help you faster than large parcel services and answer any questions.
- Live tracking: Depending on the company, you could get real-time updates about the status of your delivery with an app. If they don’t have a live tracker, you could call customer service to give you the location of the dispatcher.
- Easy online entry: You can set up a courier online with most companies instead of going out of your way to get to an office. All you have to do is fill out the information and wait for them to pick up your package.
What is a logistics company?
A logistics company plans, implements and manages the movement and storage of goods, services or information within a supply chain from the point of collection to the point of delivery. Unlike courier services, logistics services transport a large amount of goods by trains, trucks, ships or airplanes. For example, roadLINX is a tracking company which counts as a logistics company.
Many businesses use logistic companies to move their goods around the world and the supply chain is a key part in this process. New logistics roles and services that have developed to meet fast-changing client demands in the industry. The different kinds of logistics companies depend on how a company is trading and the number of parties involved.
These are the five kinds of logistics providers:
1PL: First party logistics
Only two parties are involved in the transaction, the receiver and party shipping the goods. Overall, no other parties are involved in the transportation of these goods.
2PL: Second party logistics
This is used when one of the parties, usually the manufacturer, involves a subcontracted service provider for a clearly defined logistical task like transport by air, rail, sea and sometimes storage.
3PL: Third party logistics
This is the most common form of logistics in the industry because it takes on a major role in the supply chain of a company. It optimizes a customer’s supply chain to make it leaner and faster.
4PL: Fourth party logistics
A subcontracted party is added to oversee the entire supply chain and manages all of the subcontracted logistics providers including shipping companies, transport companies and warehousing companies.
5PL: Fifth party logistics
This is a more recent evolution in logistics as a result of the rise of e-commerce. 5PL is focused on the whole supply chain network, deals with new logistical solutions and works on the strategic optimization of the entire network.
Benefits of Third party logistics
3PL offers custom solutions that meet your specific needs for assembly, packaging, warehousing and onsite integration.
A good 3PL company has thorough knowledge in logistics and the resource to help a customer identify and fill any gaps a company may have in their supply chain. They provide custom solutions that meet specific needs for assembly, packaging, warehousing and onsite integration.
Supply chains and shipments get more complicated when companies grow or when large companies spend time focusing on their core services.
Depending on your specific needs and goals, 3PL providers can offer a variety of benefits.
- Save time and money: If you use a 3PL company, you don’t have to spend money building warehousing, hiring additional labour, facilitating transportation and installing technologies. Their large network can help you get volume discounts, lower overhead costs and quicker service.
- Market expansion: You can take advantage of a 3PL provider’s distribution centers and warehouses in various regions where you don’t have an established presence so you can ship efficiently to your customers anywhere in the world.
- Scalability and flexibility: 3PL providers have a large network over in-house supply chains so you can quickly expand in a cost-effective way. They can also adapt to the fluctuation of your inventory between busy and slow times.
Conclusion
Courier services are a great option when someone or a company wants to deliver mail, valuable documents or small packages that are 150 lbs or less to someone locally, around the country or internationally. Courier services are more expensive because they offer delivery at custom times any day of the week from a few hours to a few days.
Logistics companies manage the entire flow of the delivery process including all of the warehouses, people and resources that are involved from the point of collection to the point of delivery. There are five kinds of logistics providers: 1PL, 2PL, 3PL, 4PL and 5PL.
Third party logistics companies offer customized solutions for customers to meet their assembly, packaging, warehousing and onsite integration needs. They help companies save time, save money, expand in the market, scale their businesses and accommodate your fluctuating levels of inventory.