As global supply chains face significant uncertainties in 2025 due to ongoing geopolitical disruptions and evolving trade policies, more companies are looking for one-stop-shop solutions such as fourth-party logistics providers (4PLs).
The 4PL market has grown 10% over the past two years and is expected to have a compound annual growth rate of 8.39% to reach $104.54 billion by the end of 2030, according to a study by Verified Market Reports.
“There’s more disruption. There’s more fluidity in the design of global networks,” David Gonzalez, vice president in the logistics, customer fulfillment and network design team at Gartner, told FreightWaves in an interview.
Technology research and consulting firm Gartner recently released its 2024 “Market Guide for Fourth-Party Logistics,” which discusses the value 4PLs deliver in an ever-changing global logistics network.
“Companies are choosing to make products in different locations, which results in a different flow of freight from various different countries, and that increases complexity, but also the flexibility that companies want to retain in the way that they deploy their global supply chain networks. I think those two are the key reasons why we’ve seen an increase in demand for 4PLs,” Gonzalez said.
While 3PLs can help a company execute its logistics strategy, 4PLs help companies with strategy, orchestration and management of an entire supply chain, according to Gonzalez.
“The biggest difference is that a 4PL doesn’t necessarily have to execute the service themselves,” Gonzalez told FreightWaves in an interview. “A 4PL is about managing the day-to-day transactions and the day-to-day components of a logistics service, either through infrastructure provided by subcontractors or managing other organizations and being able to combine all of those individual notes of service into one end-to-end process.”
Gonzalez said companies in the automotive supply chain were some of the earliest adopters of 4PL services.
“Automotive have been invested in 4PL for a while, and I think they’re probably one of the first movers in supporting this kind of service when I think it was first created back in the late 1960s, early 1970s, when 4PLs started to actually sort of become evident within our industry,” Gonzalez said.
Other industries that are increasingly looking for 4PL services are pharmaceuticals, energy and consumer products.
“Interestingly, with retailers, we don’t necessarily see significant growth in the retail sector towards 4PLs, but we don’t think that their global supply chains are really less complex than other vertical industries,” Gonzalez said. “I think retailers have been invested in logistics for a very long time, so they’ve almost created this capability internally, rather than have to buy it in from an outside company.”
