1PL

1PL, or first-party logistics, is a term used in supply chain management to describe logistics activities conducted by the shipper using its own internal resources and assets, without outsourcing to external providers. In a 1PL arrangement, the company owns and operates the transportation assets (such as fleets of trucks, ships, or rail cars), warehouses, information systems, and personnel responsible for moving and storing goods. The shipper controls planning, execution, and monitoring of logistics operations and bears the associated costs and risks.

1PL contrasts with other logistics models that rely on external providers. A 2PL involves an external logistics provider that owns and operates transportation assets, while a 3PL offers broader logistics services, sometimes combining multiple functions without necessarily owning all assets. A 4PL serves as an integrator, coordinating multiple 3PLs and other resources to manage the entire supply chain. In practice, firms choose between 1PL and outsourced models based on factors such as control needs, asset availability, capital requirements, and strategic priorities. 1PL is more common among smaller firms or those with highly sensitive or regulated operations, where direct oversight is advantageous.

Advantages of 1PL include greater control over processes, security, and data, as well as potential alignment with corporate objectives. Limitations can be higher capital expenditure, asset underutilization, reduced flexibility, and greater exposure to operational risk. The decision to remain 1PL or move to 2PL/3PL/4PL often hinges on scale, core competencies, and the desire for supply chain specialization. Related concepts include private fleets, in-house logistics, and the broader taxonomy of logistics outsourcing terms.