Blog Posts Find the Right Transportation Solution for Your Business
Key Takeaways
- As transportation management increases in complexity, shippers should explore options for transporting products.
- It’s important to have a clear understanding of your specific needs in order to decide if you should handle transportation in house or use a third-party provider (3PL).
- If you decide to outsource, a variety of transportation solutions are available, including fleet services, brokerage services, parcel and total transportation management.
Tightening capacity, a driver shortage, rising rates… transportation management is more complex than ever. Today’s manufacturers, retailers and ecommerce companies must navigate a litany of challenges to get their products from Point A to Point B.
Saddle Creek Logistics’ new guide identifies key factors to consider when managing outbound transportation and explores options available to help shippers transport products efficiently and cost-effectively.
Following is an excerpt…
What is My Best Option for Managing Transportation?
In-House vs. Outsourcing
If you have consistent freight needs and a knowledgeable transportation department, you may opt to manage transportation in-house, using your own fleet or establishing relationships with carriers. This option gives you complete control over your shipments, but it can be time-consuming and costly.
More often, shippers look to third-party logistics providers for support. They’re likely to utilize a 3PL for some or all of their transportation needs. In fact, 74 percent of shippers outsource domestic transportation, according to the 2021 Third-Party Logistics Study.
What drives so many shippers to outsource transportation services? As a rule, third-party providers offer the benefits of a transportation department without the overhead investment. Thanks to economies of scale, 3PLs give you greater buying power and the flexibility to accommodate fluctuations and navigate capacity issues. An experienced provider with established resources can also offer top-tier technology solutions and the ability to support multiple distribution nodes. 3PLs that provide integrated services, such as warehousing and fulfillment, allow you to have a single point of contact for all your logistics needs.
74 percent of shippers outsource domestic transportation.
Source: 2021 Third-Party Logistics Study
What Kind of Transportation Solution Do I Need?
If you choose to outsource, you’ll need to determine the best transportation solution to meet your needs. The most common options include:
Fleet Services
Asset-based 3PLs have their own fleets available to handle regional shipments as well as short-haul and shuttle services. This resource can be particularly valuable when the freight market is tight. If you routinely ship full truckloads, it may make sense to look for a provider that can offer committed capacity or a dedicated fleet.
Brokerage Services
3PLs can also work with other carriers to find the best options for your shipments, via ocean, air, or land. They can handle all of your freight or just occasional shipments. Qualified 3PLs will typically offer route optimization, track and trace, reporting, auditing and bill pay services.
Parcel Services
Shippers with a high volume of small packages often look to 3PLs for help with parcel management, including carrier management, information support, technology resources and more.
Total Transportation Management
An expert 3PL can manage your entire transportation portfolio, overseeing everything from strategic planning to carrier selection, rate negotiation, route optimization and more. This can be an effective option if you have limited resources or transportation is not your core competency.
For more information on factors and trends impacting outbound transportation, read the Guide to Effective Transportation Management.
