Terms for Logistics Company

Different countries and cultures have different definitions for industry terms, so here are the definitions from the lens of an AfterShip Logistics Partnerships Director who manages 1,100 logistics partnerships globally:

Logistics Glossary

1PL - 1st Party Logistics. Typically, a retailer or merchant that owns and operates their own logistics is a 1PL. TIP: There is only 1 party involved.

2PL - 2nd Party Logistics. Someone who owns and operates assets like trucks, vans, ships, and planes, and services a customer who needs to use those assets. Technically, someone who owns a warehouse and leases it for use would also qualify as a 2PL (e.g., Goodman). TIP: These are the famous carriers (aka couriers) like UPS, FedEx, DHL, etc.

Carrier Confusion

Carrier. Usage varies by region and industry. Technically, a carrier is any company involved in the transport of goods. This means FedEx delivering a small parcel by truck is a carrier, but Expeditors or Maersk shipping 40-foot containers on a container ship is also a carrier. Yes, this means UPS, DHL, and FedEx can be both a 2PL and a carrier. I’ve noticed that those in the logistics industry tend to primarily use “carrier” to refer to ocean and air providers. TIP: It’s always clearer if you specify "parcel carrier" vs. "ocean carrier."

Common Carrier. Carriers like FedEx, UPS, and DHL can also be referred to as common carriers. A common carrier typically serves the wider public with a general, consistent offering to all or most of its customers. Yes, this means that DHL, FedEx, and UPS can be a 2PL, carrier, and common carrier simultaneously.

Courier. A courier could be considered a type of carrier. Couriers are typically associated with fast, small deliveries. I’ve noticed that in some countries, eCommerce sellers prefer to use the term “courier” for companies like UPS, FedEx, and DHL, while in others, they prefer “carrier.” TIP: The nice thing about using the term courier is that nobody will think you mean MOL or Schenker when you say “courier.”

Heavy Parcel, Oversized Parcel, 2-Man Delivery. Parcel carriers will often have a limit on how heavy or large a parcel can be. Shipments that exceed those thresholds will have to go with specialized providers that can offer “heavy parcel”, “oversized parcel”, or “2-Man Delivery.” These shipments are typically delivered in trucks and vans. They can be parcels, but might also be furniture or appliances.

LTL/FTL, Trucking, Road, Freight. These terms usually refer to transporting bulkier cargo. Very likely the cargo, if consumer goods, will now be palletized.