What is the definition of "third-party logistics" (3PL)?

Third-party logistics (3PL) is defined as a service that enables businesses to outsource various components of their supply chain and distribution services. This approach allows companies to reduce costs, access specialized expertise, and enhance their operational efficiency by leveraging the capabilities and resources of logistics providers.

In practice, 3PL providers can handle a wide range of logistics functions, including transportation, warehousing, inventory management, order fulfillment, and freight forwarding. By using 3PL services, businesses can focus on their core competencies while leaving the complexities of logistics management to specialized providers.

The other choices do not accurately capture the essence of third-party logistics. For example, a system that eliminates logistical support does not reflect the collaborative aspect of 3PL. A technology platform for inventory management represents just one element of logistics and does not encompass the broader outsourcing strategy that 3PL entails. Similarly, managing all transportation logistics directly contradicts the fundamental principle of 3PL, which is to delegate these responsibilities to external providers.