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Second-Party Logistics (2PL): Evolving Your Logistics Services

In: Level Up Your Logistics

Author

Listed:
  • Scott McDonald

    (RMIT University)

  • Minh Duong Kim Ngo

    (RMIT University)

Abstract

This chapter examines the evolution from First-Party Logistics (1PL) to Second-Party Logistics (2PL), where companies transition from managing their own logistics to providing transportation services to other businesses. It presents three primary pathways to become 2PL providers: internal evolution from established 1PL operations, direct establishment as transportation service providers, and diversification from adjacent industries. The chapter outlines key components of successful 2PL operations—transportation excellence, customer service infrastructure, and business development capabilities—and provides a comprehensive operational framework. Industry-specific considerations for retail/e-commerce, manufacturing, and healthcare sectors are discussed, along with strategic positioning considerations. A detailed three-phase transformation journey is presented: foundation building, market entry preparation, and launch and growth. The chapter also addresses essential technology systems, pricing strategies, performance monitoring, and risk management frameworks. Through a case study of Trans-Cargo Solutions, it illustrates a successful 1PL to 2PL transformation, concluding with insights on scaling operations and emerging trends shaping the future of logistics service providers.

Suggested Citation

  • Scott McDonald & Minh Duong Kim Ngo, 2025. "Second-Party Logistics (2PL): Evolving Your Logistics Services," Springer Books, in: Level Up Your Logistics, chapter 0, pages 415-444, Springer.
    • Handle: RePEc:spr:sprchp:978-981-95-0533-3_10
    DOI: 10.1007/978-981-95-0533-3_10
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