This document provides an overview of 4PL logistics. It defines 4PL as an integrator that accumulates resources, capabilities and technologies to run complete supply chain solutions. The document outlines the key differences between 3PL and 4PL providers. It then describes two case studies where 4PL was used: one involving resource integration for an appliance manufacturer using ant colony optimization, and another involving logistics market scheduling in Wuhan using a genetic algorithm. Both cases showed 4PL approaches improved coordination, flexibility, and reduced costs and tardiness compared to traditional 3PL approaches.

1. Arjun.U.Nair
S7 N
Roll No. 11400006
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2. ACKNOWLEDGEMENT
I express my gratitude to all the
researchers whose work helped me to
attain knowledge about the subject . I
would also like to thank my professors
and friends for their immense support .
Arjun.U.Nair
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3. CONTENTS
1. Logistics
2. PLs(Party Logistics)
3. What is 4PL ?
4. Major 4PL providers
5. Why 4PL ?
6. Comparison between 3PL and 4PL
7. How 4PL ?
8. Conclusion
9. References 3

4. LOGISTICS
 Initially derived from supply chain
concept .
 Demand of more integrated methodologies
lead to integrated services.
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5.  “ The process of planning , implementing ,
and controlling the efficient , cost effective
flow and storage of raw materials , in-
process inventory , finished goods , and
related information flow from point-of-
origin to point-of-consumption for the
purpose of conforming to customer
requirements “(Cooper,1997)
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6. PLs(Party Logistics)
Generally there are 4 types of Party Logistics
 One Party Logistics(1PL)
 Two Party Logistics(2PL)
 Three Party Logistics(3PL)
 Four Party Logistics(4PL)
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7. FIGURE 1 : Hierarchy of Logistics
Source :4PL,the future of supply chain outsourcing?, Seraffetin
Kutlu
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8. WHAT IS 4PL ?
 Introduced by Accenture in 1996 .
 An integrator that accumulates resources,
capabilities and technologies to run
complete supply chain solutions.
 Outsourcing - Multiple supply chain
management service provided by a single
vendor on a contractual basis.
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9. Major 4PL Providers
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WHY 4PL ?
 Used when supply chain are of complex
nature
 Reduces risk within the supply chain
 Greater concentrated work
 More efficiency

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Comparison of 3PL and 4PL
3PL 4PL
• Specialises in the
operational element of
supply chain
management
• Manages all the
activities of supply
chain
• Targets a single
function
• Manages the whole
process , sometimes
even the 3PL
• Major activities include
Warehousing
Transportation
Packaging
• Major activities include
Consultancy
Storage
Distribution
Processes

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HOW 4PL ?
Case Study on Resource Integration
by 4PL
Case Study on Logistics Market in
Wuhan

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Resource Integration for an
Appliance Manufacturer
Use of Integration Simulation for building a
new workshop
Resource Integration done by 4PL
 Consulting Individuals and 3PL individuals
chosen as decision examples to verify the
algorithm
Algorithm used is ACO(Ant Colony
Optimization)

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Table 1
Table 2
Source:Decision optimization analysis on supply chain
resource integration in fourth party logistics
Source:Decision optimization analysis on supply chain
resource integration in fourth party logistics

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Parameters α, β, γ shows relationship
between attraction probability and repulsion
probability.
Simulation conducted using MATLAB
software

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Fig 2-source:Decision optimization analysis on
supply chain resource integration in fourth party
logistics

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Fig 3-source:Decision optimization analysis on supply
chain resource integration in fourth
party logistics

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Better coordination and balance in multi
objectives
Better flexibility in portraying capacity
constraints in supply chain
Integration by 4PL using AOC technique
was satisfactory.

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Logistics Market in Wuhan
To reduce cost and to make a more optimized
scheduling for functioning of supply chain.
Tasks in the 4PL were broken down and taken up by
3PL services
3PLs were divided into resource nodes.
The main objectives were
Minimize the total costs to finish all activities.
Minimize the total finishing time of all activities.
Minimize the total tardiness of all tasks.

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Source:Novel multi-objective resource allocation and activity scheduling for
fourth party logistics
Table 3

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Source:Novel multi-objective resource allocation and
activity scheduling for fourth party logistics
Table 4

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An improved non-dominated sorting genetic
Algorithm (NSGA-2) was used
Experiment conducted in a pentium-4, 512 MB
RAM system and programmed in C++.
After many trials, it was found that setting
population to 300, mutation rates among 0.01-
0.02, crossover rate of 0.8-0.9, better solutions were
obtained.

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No:2 solution was chosen as the best solution.
Total tardiness and costs were reduced.
Source:Novel multi-objective resource allocation and activity
scheduling for fourth party logistics
Table 5

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Fig 4- Source:Novel multi-objective resource
allocation and activity scheduling for fourth
party logistics

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CONCLUSION
The relevance of Logistics
The involvement of PLs(Party logistics)
The importance of 4PL and its continuous
growth in logistics and supply chain
management.
The pros of 4PL over 3PL

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Applications:
1. Resource integration for appliance manufacturer
2. Logistics Market in Wuhan

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References
•Novel multi-objective resource allocation and activity
scheduling for fourth party logistics , Qiong Liu ,
ChaoyongZhang , KerenZhu , Yunqing Rao
•Decision optimization analysis on supply chain resource
integration in fourth
party logistics, Jianming Yao
•Fourth party logistics routing problem with fuzzy duration
time Min Huang , YanCui , ShengxiangYang , XingweiWang

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THANK YOU!