BY ADRIAN GONZALEZ
3PLs
strategicinsight
This story first appeared in the Special Issue 2014 edition of CSCMP’s Supply Chain Quarterly, a journal of thought leadership
for the supply chain management profession and a sister publication to AGiLE Business Media’s DC VELOCITY. Readers can
obtain a subscription by joining the Council of Supply Chain Management Professionals (whose membership dues include the
Quarterly’s subscription fee). Subscriptions are also available to nonmembers for $34.95 (digital) or $89 a year (print). For
more information, visit www.SupplyChainQuarterly.com.
Convergence is
the word
Third-party logistics
providers (3PLs) are
transforming themselves
into businesses that
provide a diverse array
of services well
beyond logistics.
IF I HAD TO DESCRIBE THE STATE OF THE
third-party logistics (3PL) industry in one word,
it would be convergence. Convergence refers to the
merging of distinct technologies, industries, or
devices into a unified whole. And that is exactly
what is happening in this industry on two fronts.
The first involves the convergence of fragmented
logistics services with integrated logistics solutions.
This has been happening for many years, primarily
via mergers and acquisitions. It is a path toward
fulfilling the traditional definition (and promise)
of a 3PL. Here is the Council of Supply Chain
Management Professionals’ definition:
A firm that provides multiple logistics services
for use by customers. Preferably, these services
are integrated, or “bundled” together by the
provider. These firms facilitate the movement
of parts and materials from suppliers to manu-
facturers, and finished products from manufac-
turers to distributors and retailers. Among the
services they provide are transportation, ware-
housing, cross-docking, inventory management,
packaging, and freight forwarding.
This convergence of services and broader solutions has also led logistics service providers to drive
new growth by expanding globally to support clients
across different geographic regions and by targeting
new vertical industries, such as health care and ener-
