What is the meaning of Fifth Party Logistics (5PL)?

Fifth-party logistics (5PL) is a model in which a company outsources its entire supply chain to a single logistics provider that plans, organises and runs all logistics on its behalf. The 5PL provider manages the whole network rather than individual shipments.

5PL and the other logistics levels

A 5PL provider typically coordinates the services of third-party (3PL) and fourth-party (4PL) logistics operators across the supply chain, negotiates rates and often uses technology and data to optimise the network as a whole. It is the broadest form of logistics outsourcing.

When 5PL is used

The model suits companies that want to hand over end-to-end supply-chain management, such as large e-commerce or manufacturing businesses. The 5PL provider acts as a lead logistics partner, similar to a freight forwarder but at the level of the entire network.