First-party logistics (1PL)

What is 1PL?

A first-party logistic provider is any company that transports cargo, freight, goods or merchandise, and can refer to both the cargo sender (like a manufacturer delivering to customers) or the cargo receiver (like the retailer picking up cargo from a supplier).

Simply put, the entire logistics and distribution process is managed internally by the business. This method of logistics is relatively uncommon, as most businesses today outsource their logistics operations to external providers.

1PL example

Australian red meat supplier Samex is a 1PL as it exports goods to wholesalers, distributors and supermarket chains worldwide using its own logistics operations.

Pros of 1PL

• Complete control of the logistics and fulfillment process
• Control of quality processes
• Control over packaging and transportation

Cons of 1PL

• The business must own and be responsible for every facet of the logistics process
• High-quality fulfillment is expensive and requires additional infrastructure, staff, equipment, etc.

The 1PL approach is typically used by large companies that have the volume and infrastructure to manage their entire supply chain internally.