Logistics outsourcing involves a relationship between a company and an LSP (Logistic Service Provider) which, compared with basic logisticsservices, has more customized offerings, encompasses a broad number of service activities, is characterized by a long-term orientation, and, thus, has a rather strategic nature.
An LSP is really what most people would see as a traditional 3PL provider offering a combination of warehousing and transportation services or one or the other. As global and multi-national providers enter the game, things have certainly changed, but the Logistics Service Provider at its core is fundamentally the same.
Third-Party Logistics Provider (3PL) involves using external organizations to execute logistics activities that have traditionally been performed within an organization itself. According to this definition, third-party logistics includes any form of outsourcing of logistics activities previously performed in-house. If, for example, a company with its own warehousing facilities decides to employ external transportation, this would be an example of third-party logistics. Logistics is an emerging business area in many countries.