Logistics has turned into a developing industry over the years. In order for a company to develop its commercial activities, it requires successful logistics activities. The logistics model in which the manufacturer does not delegate its transportation and logistics operations to third parties is called first-party logistics.

Logistics has turned into a developing industry over the years. In order for a company to develop its commercial activities, it requires successful logistics activities. The logistics model in which the manufacturer does not delegate its transportation and logistics operations to third parties is called first-party logistics. This is one of the simplest supply chains. Logistics basically started with 1PL, where manufacturers delivered their products directly to customers. So first party logistics is the first layer of logistics layers. Later, as trade networks expanded and became more complex, new logistics models developed. Today, this model may not be suitable for some companies. Generally, small businesses prefer this model.
The type of logistics that transmits the goods or services produced by itself from one location to another directly to the seller is first party logistics. The aspect that distinguishes the 1PL model from other models is that the manufacturer performs all these functions through its own department. Logistics activities include storage and forwarding functions. The manufacturing company performs these functions through its own departments and personnel. In other words, companies should have their own trailers, trucks, transport vehicles and warehouses. The goods producing company has control over the forwarding and storage services. It can easily organize and plan these functions.

First-party logistics involves only two parties. Therefore, 1PL service providers are in direct contact with their customers. They do not cooperate with any other external party for these transactions from the outside. This process, in which importers, exporters, traders and retailers run their own logistics operations, is the definition of first-party logistics. In this type of service , companies have to consider many factors, from warehouse to customer service. All of these operations require strong organization and communication in the rear.

What are the Advantages of First Party Logistics?

1. 1PL service providers can produce faster solutions for problems in transportation or storage. When customer problems are encountered, communicating with a department within the company and taking action will cause the problems to be solved more easily.
2. It does not have to rely on a new batch because it is in the company's own department that controls the resources needed to move products from one point to another. When the firm engages a third party for all of these transactions, it has to rely on another organization.
3. It offers first-party logistics companies certain flexibility in planning and transportation. Companies can act according to their own plans, not the plans of a third party. Thus, companies provide complete control.

What are the Disadvantages of First Party Logistics?

1. 1PL service providers will have to bear all the risks they will encounter in transportation and storage. These risks include vehicle breakdowns and personnel problems. In the same way, he has to undertake the delays that he will encounter in any problem.
2. Applying a first-party logistics model for logistics activities can make transportation and storage operations much more expensive and time-consuming for the company. The firm carries out its logistics activities with a new department and has to own some assets.

In the first-party logistics model, the company has to use its existing resources while sending products to its customers. When it produces more than the resources it can use, it has storage and transportation problems. It needs to expand its existing resources to work on a larger quantity of products and is very difficult for small and medium sized companies. It is possible to obtain expert knowledge from Horoz Logistics professionals for your company's logistics services.