UNDERSTANDING LOGISTICS SERVICES: FROM 1PL TO 5PL
English Version
INTERNATIONAL LECTURE
“UNDERSTANDING LOGISTICS SERVICES: FROM 1PL TO 5PL”
Speaker: Dr (c).
Julian Barona, Senior Lecturer of Logistics and SCM, Higher Colleges of
Technology (HCT), Abu Dhabi - UAE
Reviewer: Prof. Dr. Ir. Agus Purnomo, M.T., CMILT. (Professor
of Supply Chain Management - Master of Logistics Management Department –
Universitas Logistik Dan Bisnis Intenasional – ULBI)
An interesting fact: global logistics costs in the 3PL and 4PL sectors reached more than USD 1.081 trillion in 2022, and are projected to rise to over USD 2.184 trillion by 2030, driven by the growth of e-commerce and supply chain digitalization? Amid this wave of transformation, a critical question arises: Are companies ready to move from simple logistics models to integrated 5PL services that combine technology, innovation, and cross-network coordination?
A quote from Keith Oliver, pioneer of Supply Chain Management, reminds
us: “The supply chain of the future will be orchestrated, not just
operated.” The international
lecture “Understanding Logistics Services: From
1PL to 5PL” delivered
by Dr. Julian Barona is highly relevant for undergraduate, applied
undergraduate, and Master’s students of Logistics Management at ULBI—because it
not only explores the evolution of logistics service levels (from 1PL to 5PL)
but also examines their strategic implications for industry, education, and
international business in the era of Industry 4.0 and beyond.
Summary of
Key Themes
In his international lecture, Dr. (c). Julian Barona outlined the evolution of
logistics services from First Party Logistics (1PL) to Fifth Party Logistics
(5PL) as a crucial framework for both companies and academics. The concept of
“PL” (Party Logistics) represents the degree of outsourcing within the supply
chain, starting from 1PL, which is entirely self-managed, to 5PL, which
leverages advanced technologies to orchestrate global networks. At the 1PL
level, companies manage their own transportation and distribution, granting
full control but making scalability difficult. 2PL introduces specialized
transport providers, improving efficiency in the movement of goods.
A significant leap occurs with 3PL, where logistics services expand to
include warehousing, inventory management, distribution, and even reverse
logistics. 4PL functions as a supply chain strategy integrator, coordinating
multiple 3PLs while adding layers of technology and partnerships. At its peak,
5PL delivers global network orchestration powered by AI, big data, and
automation, enabling worldwide scalability—particularly for e-commerce.
Case
Studies and Key Practices
One case study highlighted the evolution of e-commerce, showing how a small
business began as a 1PL, managing deliveries from a home garage with dozens of
orders, then transitioned to 2PL using local transport services to handle
hundreds of orders. As it expanded, the company adopted 3PL for automated
fulfillment, then grew into 4PL with multi-channel optimization capable of
processing tens of thousands of monthly orders. Eventually, it embraced 5PL
with AI-driven demand forecasting and global expansion.
Another case from the electronics industry demonstrated how a company
initially managing its own transportation and warehousing eventually needed to
evaluate outsourcing strategies as it expanded internationally. These examples
underscore that choosing the right PL model must align with a company’s growth
dynamics and complexity. The evolution of PL is not merely a theoretical
concept but a strategic reality that defines business sustainability and
competitiveness in the digital era.
Analysis
& Discussion
The evolution of logistics services from 1PL
to 5PL carries significant implications for industry, education, and society at
large. For industry, understanding each PL level helps companies determine
outsourcing strategies that match their growth stage and business complexity,
while also unlocking opportunities for cost efficiency, enhanced customer
service, and accelerated market expansion. On the other hand, challenges arise
in the form of technology investment, system integration, and organizational culture
transformation that supports cross-network collaboration. For education,
particularly at ULBI, this topic enriches the curriculum with both practical
and strategic perspectives, preparing students to face the realities of a
dynamic business environment.
In the Indonesian context, the relevance of this topic is especially
strong, given that national logistics costs remain relatively high and
digitalization levels are uneven. Gaps in infrastructure, digital skills, and
MSME readiness present tangible barriers, but also substantial opportunities:
Indonesia can accelerate its competitiveness by advancing the adoption of 3PL
through 5PL models while simultaneously building adaptive logistics human
capital through close collaboration among universities, industry, and
government.
Conclusion
This review of the international lecture
reaffirms that understanding the evolution of logistics services from 1PL to
5PL is not merely a theoretical exercise but a strategic key to building supply
chain competitiveness and sustainability in the digital era. Adopting,
researching, and further exploring this topic is essential for both industry
and academia to adapt to global complexities while seizing opportunities for
technology-driven innovation.
Therefore, let students, faculty, and logistics practitioners use this
discussion as a catalyst for real collaboration in research, education, and
industrial practice. As Peter Drucker once said: “The best way to predict the future is to create it.” The
question now is: are we ready to create a future for Indonesia’s logistics that
is more efficient, integrated, and globally competitive?
Indonesian Version
INTERNATIONAL LECTURE
“UNDERSTANDING LOGISTICS SERVICES: FROM 1PL TO 5PL”
Pembicara: Dr (c). Julian Barona, Senior Lecturer of Logistics and SCM, Higher Colleges of Technology (HCT), Abu Dhabi - UAE
Pengulas: Prof. Dr. Ir. Agus Purnomo, M.T., CMILT. (Guru Besar
Supply Chain Management - Master of Logistics Management Department –
Universitas Logistik Dan Bisnis Intenasional – ULBI)
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