The increasing demand for 4PL services is challenging eCommerce 3PLs to offer value-added features traditionally provided by 4PLs. Zendbox, a UK-based eCommerce fulfilment provider, is rising to the occasion by integrating the transparency and control of a 3PL with the strategic benefits typical of a 4PL.
Although 4PL services are generally exclusive to large global brands, Zendbox’s 3PL services offer mid-sized retailers access to enterprise-level strategic account management, sophisticated inventory analytics, and an industry-leading 10pm order cut-off time.
James Khoury, founder and CEO of Zendbox, explained: “As a 3PL, Zendbox focuses on specific operational functions, whereas 4PLs typically oversee the entire supply chain, from raw materials to orchestrating multiple fulfilment centres globally. 3PLs typically own their own warehousing infrastructure and technology, whereas 4PLs do not, and instead rely on their relationships with 3PL providers, manufacturers and suppliers.”
“Operationally, Zendbox handles everything from receiving inventory, picking and packing, order processing, shipping, returns management, reporting and analytics. 4PLs, on the other hand, begin with developing a strategy for their client, presenting a selection of candidate fulfilment services, then coordinating the implementation of providers, and in the medium to long-term, optimizing the supply chain, identifying bottlenecks and gaps in customer service quality. At Zendbox, we are proud to offer many of these benefits that are normally exclusive to 4PLs, making them accessible to mid-market retailers who ship anywhere from 30 to thousands of orders per day.”
“Both 3PLs and 4PLs require ongoing performance management, with periodical review meetings to monitor KPI and OKR metrics, and Zendbox is no exception. Our goals with clients are to minimise overheads, enhance the customer experience, make more profitable business decisions, expand into new markets, and drive continuous improvement.”
Growth in the 4PL Sector
According to a 2022 report, the 4PL market was valued at $59.5 billion in 2022 and is expected to reach $114 billion by 2032, with a compound annual growth rate (CAGR) of 7.5% over the forecast period. The rising complexity of supply chains and the increasing focus on technology and digitalisation within the logistics industry are major factors driving market growth. As retailers push for international expansion, challenges such as customs clearance, shipping, and inventory management become more intricate. In the future, 4PL providers must adopt IoT, AI, and blockchain technologies to stay competitive and grow their market share.
