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FOURTH PARTY LOGISTICS

Arjun.U.NairS7 N

Roll No. 11400006

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ACKNOWLEDGEMENT

I express my gratitude to all the researchers whose work helped me to attain knowledge about the subject . I would also like to thank my professors and friends for their immense support .

Arjun.U.Nair

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CONTENTS1.Logistics

2.PLs(Party Logistics)

3.What is 4PL ?

4.Major 4PL providers

5.Why 4PL ?

6.Comparison between 3PL and 4PL

7.How 4PL ?

8.Conclusion

9.References

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LOGISTICS

Initially derived from supply chain concept .

Demand of more integrated methodologies lead to integrated services.

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“ The process of planning , implementing , and controlling the efficient , cost effective flow and storage of raw materials , in-process inventory , finished goods , and related information flow from point-of-origin to point-of-consumption for the purpose of conforming to customer requirements “(Cooper,1997)

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PLs(Party Logistics)

Generally there are 4 types of Party Logistics

One Party Logistics(1PL)

Two Party Logistics(2PL)

Three Party Logistics(3PL)

Four Party Logistics(4PL)

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FIGURE 1 : Hierarchy of Logistics

Source :4PL,the future of supply chain outsourcing?, Seraffetin Kutlu

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WHAT IS 4PL ?

Introduced by Accenture in 1996 .

An integrator that accumulates resources, capabilities and technologies to run complete supply chain solutions.

Outsourcing - Multiple supply chain management service provided by a single vendor on a contractual basis.

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Major 4PL Providers

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WHY 4PL ?

Used when supply chain are of complex nature

Reduces risk within the supply chain

Greater concentrated work

More efficiency

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Comparison of 3PL and 4PL3PL 4PL

• Specialises in the operational element of supply chain management

• Manages all the activities of supply chain

• Targets a single function

• Manages the whole process , sometimes even the 3PL

• Major activities include

Warehousing Transportation Packaging

• Major activities include

Consultancy Storage Distribution Processes

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HOW 4PL ?

Case Study on Resource Integration by 4PL

Case Study on Logistics Market in Wuhan

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Resource Integration for an Appliance Manufacturer

Use of Integration Simulation for building a new workshop

Resource Integration done by 4PL

Consulting Individuals and 3PL individuals chosen as decision examples to verify the algorithm

Algorithm used is ACO(Ant Colony Optimization)

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Table 1

Table 2

Source:Decision optimization analysis on supply chain resource integration in fourth party logistics

Source:Decision optimization analysis on supply chain resource integration in fourth party logistics

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Parameters α, β, γ shows relationship between attraction probability and repulsion probability.

Simulation conducted using MATLAB software

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Fig 2-source:Decision optimization analysis on supply chain resource integration in fourth party logistics

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Fig 3-source:Decision optimization analysis on supply chain resource integration in fourthparty logistics

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Better coordination and balance in multi objectives

Better flexibility in portraying capacity constraints in supply chain

Integration by 4PL using AOC technique was satisfactory.

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Logistics Market in Wuhan

To reduce cost and to make a more optimized scheduling for functioning of supply chain.

Tasks in the 4PL were broken down and taken up by 3PL services

3PLs were divided into resource nodes.

The main objectives were Minimize the total costs to finish all activities. Minimize the total finishing time of all activities. Minimize the total tardiness of all tasks.

20Source:Novel multi-objective resource allocation and activity scheduling for fourth party logistics

Table 3

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Source:Novel multi-objective resource allocation and activity scheduling for fourth party logistics

Table 4

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An improved non-dominated sorting genetic Algorithm (NSGA-2) was used

Experiment conducted in a pentium-4, 512 MB RAM system and programmed in C++.

After many trials, it was found that setting population to 300, mutation rates among 0.01-0.02, crossover rate of 0.8-0.9, better solutions were obtained.

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No:2 solution was chosen as the best solution.

Total tardiness and costs were reduced.

Source:Novel multi-objective resource allocation and activity scheduling for fourth party logistics

Table 5

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Fig 4- Source:Novel multi-objective resource allocation and activity scheduling for fourth party logistics

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CONCLUSION

The relevance of Logistics

The involvement of PLs(Party logistics)

The importance of 4PL and its continuous growth in logistics and supply chain management.

The pros of 4PL over 3PL

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Applications: 1. Resource integration for appliance manufacturer 2. Logistics Market in Wuhan

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References

•Novel multi-objective resource allocation and activity scheduling for fourth party logistics , Qiong Liu , ChaoyongZhang , KerenZhu , Yunqing Rao

•Decision optimization analysis on supply chain resource integration in fourthparty logistics, Jianming Yao

•Fourth party logistics routing problem with fuzzy duration time Min Huang , YanCui , ShengxiangYang , XingweiWang

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THANK YOU!