TL Transportation Software - Is Management Based Third Party Logistics a Good Fit?

In the debate between whether it's better to use TL transportation software-also known as full truckload logistics software and truckload logistics software-or third party logistics to arrive at the best TL shipping solutions, cost effectiveness and range of shipping options are the two most mentioned factors in favor of TL transportation software. And it's true: because management based third party logistics providers charge their clients more than shipping arrangements actually cost in or to earn their profits and only work with shipping carriers that provide the best rate discounts to make those profits possible, logistics software is an easy to use money saver that presents companies with an increased rage of shipping options. But as if this weren't enough, there are some other critical reasons why you should choose truckload logistics software over third party logistics.

Range of Services

Because every company's ideal TL shipping solutions are different, you have to make sure that a third party logistics provider offers the range of services that you need; and considering that a company's shipping needs can significantly change as it grows or decides to produce new products, it's difficult to predict that you won't need certain services at some point in the future. In fact, you could even get stuck in the position of having to fulfill a contract when a provider can't meet all of your needs. With logistics software, on the other hand, the software provider re-customizing your software options can easily tend to your new shipping needs.

Financial Soundness

In the past two years, a significant number of third party logistics providers have gone out of business or been consolidated. What this meant for their customers is exactly what it sounds like: they had to rush to form new contracts with another provider in order to keep their shipping process on track, and choosing a logistics solution in a rush is contrary to the nature of logistics. When a down turned economy starts affecting the trucking industry, carriers aren't able to offer management based third party logistics providers the same level of discounts that they used to, which leads to providers raising their rates, losing customers and eventually being consolidated or folding. The financial health of logistics software isn't based on the carrier industry, but on the freight transportation software business, which is currently booming.

Range of Control

Regardless of which type of third party logistics provider you contract with-asset based, management based or an integrated provider-you're entering a situation where another company will control your transportation logistics. The value controlling your company's operations should be based on what you lose as a result of not controlling them and not on the mediocre notion that being "in control" is automatically better than letting another company help you with its expertise. But the one thing that you always loose by opting for third party logistics is the ability to continually optimize your shipping process and realize increased cost savings and, in many cases, improved delivery time. When companies switch to logistics software, research shows that they can reduce their overall shipping costs by 10 percent at the end of one year.

Full truckload logistics software has significantly cut my company's shipping costs. To see how truckload logistics software can help, visit RateLinx.com.

Logistics Software is Better Than a Third Party Logistics Service For Small Businesses

If you own a small business that you dream of making larger, one of the greatest things standing in the way of your expansion may be your inability to deliver your products to a larger customer base. For many small companies that have aspirations to go big, shipping their products through a parcel carrier becomes too expensive because too many products are being shipped, while freight shipping is too expensive because not enough products are being shipped to compose a full freight load. Consequently, many companies remain localized and never experience the incredible revenue that could come with running a national or international business.

However, when parcel shipping and freight shipping rates prove too expensive considering the amount of product involved, small businesses still have options. One option for overcoming the product/price aspect of shipping is to hire a third party logistics service to search for the best parcel and shipping rates. But since a third party logistics service uses logistics software to examine the shipping needs of a business in relation to what services are offered by numerous parcel companies, small businesses can save money and implementing user friendly logistics software on their own. Offering the same level of quality as a logistics provider, logistics software come with an easy to use interface that makes hiring a third party expert to examine parcel and shipping rates unnecessary.

One of the commonest reasons behind unaffordable parcel rates is that many parcel companies charge for services that a company doesn't need. For example, if you plan on shipping wedding stationary to outlet stores, you probably don't need for Hazmat or residential shipping services. Yet, parcel companies regularly include these unnecessary charges until petitioned otherwise. In addition to determining the necessity of particular services, logistics software also examines the fuel surcharge rates of parcel carriers and audits shipping fees in order to uncover breaches in service among parcel companies.

Because most business don't have the time or means to discover such information on their own, implementing logistics software almost always results in the discovery of parcel rates that are significantly lower than businesses are used to paying. Instead of judging parcel companies on the surface and concluding that parcel shipping isn't an option for your business, implementing logistics software could result in parcel rates that you never imagined existed. However, the software may also determine that your volume of shipping makes shipping by parcel uneconomical, regardless of the discounts that exist, and suggest that you pursue freight shipping. But if you think that you have to come up with a full freight load to making freight shipping worthwhile, think again. Since the deregulation of the trucking industry, trucking companies have been more at liberty to offer new kinds of shipping that draw in more customers, one of which is less than truckload (LTL) shipping. In LTL shipping, multiple partial loads are combined to make one full load, with each shipper paying a fraction of the full freight shipping cost.

Seeking out better parcel rates or using LTL shipping are two of many ways that your small business can expand its reach without having to pay unnecessary shipping changes. To discover more ways to ship your products economically, implementing logistics software is the best choice.

To extend your small business beyond its local setting, you'll have to find shipping options that make sense for the volume of products that you plan on shipping. While some companies consult with a third party logistics service to solve shipping dilemmas, implementing easy to use logistics software is a more economical solution.

TL Logistics Management Software - Is It Better Than Third Party Logistics?

For companies that ship their goods by ground, using truckload (TL) shipping arrangements is key to reducing the cost of the shipping process while improving delivery time. TL shipping occurs when a shipper contracts with a carrier to ship full semi trailer loads of goods to a specific destination-a scenario that represents the opposite of less than truckload (LTL) shipping, where companies that ship less than full semi loads combine their loads to form a full load and share the price. Unlike TL shipments, which are valued for their timeliness, LTL shipments are prone to numerous pick up and delivery stops, and can result in unwanted warehouse fees.

Even if your company qualifies for truckload shipping arrangements, it still needs a way to arrive at the best arrangements for its situation-a need that can be met through one of three scenarios: hiring in house logistics experts, outsourcing to third party logistics (3PL) providers, or implementing TL logistics management software. Traditionally, companies have pursued hiring their own logistics experts; or, if developing a logistics department proved unaffordable, outsourced their logistics to a 3PL provider. But today, more companies are choosing to implement logistics software, of which TL logistics management software is one type, to arrive at the best shipping arrangements.

Compared to hiring in house experts or outsourcing to 3PL providers, TL logistics management software brings two advantages: it costs less, and it results in more shipping solutions. By allowing companies to become their own logistics providers, logistics software cuts the middleman out of the shipping process-a move that can save larger companies six figures annually. But the software also cuts down on the cost of shipping by performing shipping route analysis and optimization and analysis of integrated shipping solutions to a degree unavailable through 3PL providers.

An example of how TL logistics management software can benefit the truckload shipping process is as follows: upon performing route analysis in relation to integrated shipping options, the software might determine that shipping a load by truck half way to its destination and shipping it rest of the way by air would provide the lowest shipping cost and best delivery time. If a company used a 3PL provider, this scenario would only occur under two circumstances: if a non-asset based 3PL provider had a financial relationship with a trucking carrier and an air carrier whose routes could intertwine, or if an asset based 3PL provider owned the right assets to make such a situation financially favorable.

In my research on truckload transportation management, I've studied the truckload logistics software versus other logistical solutions.

Logistics Software Solutions - How Do They Compare to Third Party Logistics?

Third party logistics (3PL) is the most popular choice for freight logistics among small to midsized companies. In order to help companies that regularly make shipments that are too large to financially benefit from parcel shipping and too small to financially benefit from full truckload (FTL) shipping, companies turn to third party logistics providers to get them the best deals on less than truckload (LTL) shipping, integrated shipping methods and to reduce the delivery of products to retailers. To these ends, 3PL providers significantly reduce their clients' shipping costs compared to what they would spend on shipping without the aid of freight logistics. But they obviously do so by charging their clients for freight logistics services.

So, what's not to like about hiring a 3PL provider to reduce your company's shipping costs and ensure that your goods are delivered in a timelier manner? After all, is there really such a thing as realizing freight transportation solutions without seeking the help of freight logistics experts? Yes and no. If freight logistics isn't one of your company's core competencies, you'll certainly need to get logistics solutions from those that specialize in providing them. But you don't have to turn to a 3PL provider and pay a middleman to provide you with shipping solutions when you can instead use online logistics software.

The difference between 3PL and logistics software solutions-also referred to as logistics management software-typically doesn't lie in one having more logistics expertise than the other; rather, it has to do with how the logistics information is supplied, how much it costs and how much control companies have over their shipping process. Essentially, a third party logistics provider uses logistics management software to provide you with shipping solutions, whereas online logistics software lets you act as your own logistics provider for an affordable monthly fee. In no case will you find a 3PL provider that offers their services for the low price that you pay for logistics software solutions, nor will hiring a 3PL provider offer you as much control over your shipping options.

Having complete control over your shipping process has two main benefits: you can research the companies that you're considering hiring and you never have to deal with a middleman's business policies affecting the price or availability of certain shipping options. Aside of the financial and shipping management benefits offered by logistics management software, its greatest strength is its extreme ease of use. Although the term logistics software implies computer expertise, logistics software comes with an easy to use interface that neither requires expert computer knowledge or expertise in logistics, meaning that each of your company's departments can be involved in its shipping process.

When my condiment business got large enough that I needed to start shipping outside of my locale, I encountered a dilemma: to hire a 3PL firm or use logistics management software? After doing some research, I discovered that hiring a 3PL firm amounted to hiring someone to provide me with logistics software solutions that could arrive at on my own by using online logistics software. Naturally, I decided to go with the online software and save money.

Logistics Software Removes the Need For 3rd Party Logistics Providers

The more products a company ships, the more shipping costs become subject to cost saving strategies. For most companies, realizing the most economical shipping solutions depends on the implementation of the most popular form of supply chain software (SCS): logistics planning software. On the most basic level, the solutions offered by logistics software improve a company's phased planning measures, product sales forecasts and scientific safety stock. Some companies hire 3rd party logistics providers, but more and more companies are turning to logistics software in place of 3rd party logistics providers for two reasons: logistics software offers the same level of quality as 3rd party logistics providers and it offers it a much lower price.

When companies use logistics planning software, they can centralize and integrate their product delivery system by allowing drivers at different sites to connect using the most efficient travel routes, which increases product delivery time and decreases fuel costs by reducing empty running. Regardless of which style of logistical planning a company needs to implement-inbound logistics, contract logistics, LCL/FCL, LTL/FTL, etc.-logistics planning software allows companies to arrive at advanced planning and scheduling solutions that can significantly increase their bottom line. By implementing this software, companies can improve the cost effectiveness of the following product distribution arrangements, among others: container planning and empty container repositioning, intermodal transport, multi-hub and multi-leg transport, cross docking, multi-compartment trailer planning and inventory management.

One example of how logistics software helps companies reduce their shipping costs can be seen in less than truckload (LTL) shipping arrangements. Especially beneficial for companies that don't ship a high volume of goods, LTL shipping allows companies to pay a fraction of full truckload (FTL) shipping costs. LTL shipping combines multiple partial truckloads into a full truckload and splits the full load price between the shippers. For trucking companies, LTL is beneficial because it draws in customers who would traditionally ship their good by parcel carrier. Another example of how logistics software can save companies money is by examining the characteristics of shipping routes. For example, while the shortest route might seem to be the fastest route, this software can reveal that a longer route would be faster due the traffic characteristics of the shorter route.

Without this software, most companies continue to pay more for logistical solutions than they need to. While research shows that both logistics software and 3rd Party logistics providers can help companies reduce their annual shipping costs by 10 percent at the end of one year, opting for this software adds to the savings. When companies use logistics software, they increase their bottom line in basic two ways: by delivering their products to the sales floor faster and by reducing the cost of getting them there.

For companies that want to increase their selling power and reduce their shipping costs at the same time, logistics software provides the answer. From LTL shipping solutions to shipping route analysis, logistics software offers the same logistical solutions as 3rd party logistics providers but at a much lower price.

TL Transportation Software - How Does It Compare to Third Party Logistics?

If your company has grown to the point that it is ready to start shipping its goods to other states, then you've probably heard more than your fair share of transportation logistics talk. In the freight logistics industry, you'll rarely meet someone that seems as if they don't know what they're talking about, and each consultant or company can tell you why their logistics solutions are the best.

So, how do determine the good from the bad and mediocre from the awful? To put first things first, your initial concern with achieving the right shipping solutions should be how much they cost versus the benefit that they'll deliver. With this in mind, most midsized and growing companies that have truckload (TL) shipping needs quickly arrive at a crossroads: should they hire a third party logistics (3PL) provider or should they implement TL transportation software?

Also known as truckload logistics software, TL transportation software is offered by software companies that specialize in transportation logistics. TL transportation software can be implemented into your company's shipping process as either an online software application that allows for remote access or an internal application, depending on your wants and needs. In either case, the software comes with an easy to use user interface that allows you to become your own logistics provider.

When you opt for logistics software, you don't have to hire logistics professionals to operate the software, and that's where part of the cost savings comes in versus hiring a 3PL provider. When you hire a 3PL provider, you're paying for logistics professionals to act as middlemen between your company and freight carriers, whereas with logistics software, you're paying for a computer application that has been developed by logistics professionals.

In addition to costing less as a service, logistics software also gives its users greater control over the shipping process by providing them with more shipping options. Because 3PL providers make their money by charging their clients more than a TL shipping solution actually costs, in order to keep their rates reasonable, they only partner with carriers that offer preferred "discounts". What this means, of course, is that you only have the option of shipping with carriers that allow 3PL providers to make a profit, regardless of whether a non-discounting carrier might be able to save you the most money concerning other shipping cost factors, such as route length.

Some companies are happy to use 3PL providers because they simply don't want to handle logistical concerns. But this attitude is usually based on the idea that, if a company doesn't boast logistics as one of its core competencies, it won't able to handle transportation logistics. When you opt for you opt for TL shipping software to achieve TL shipping solutions, you quickly realize that this isn't the case. While 3PL can certainly provide you with valuable TL shipping solutions, there's simply no need to spend extra money and have a decreased range of shipping options when you can easily handle your own logistics with the aid logistics software.

If I sound passionate about logistics software, it's because TL transportation software has allowed my midsized company to significantly reduce its shipping costs after one year (almost a 10 percent reduction and growing). Like many small to midsized companies, I once outsourced my logistics. But when I took a chance on logistics software, I realized that the claims were true: I could successfully arrive at my own TL shipping solutions.

TL Shipping Software Versus Management Based Third Party Logistics - Which is Better?

Truckload logistics software is increasingly becoming the logistics solution of choice among small to midsize companies that don't employ logistics professionals. In most cases, companies that don't employ logistics experts or use logistics software turn to third party logistics providers to handle their truckload (TL) shipping solutions. Companies may choose third party logistics providers for a variety of reasons, but two factors that generally influence this decision are companies' perception that they can't handle their own logistics and the corollary perception that only companies that specialize in transportation logistics could yield the most optimal TL shipping solutions. Converse to these perceptions is the fact that many companies that lack core competency in logistics are now acting as their own TL logistics providers by using truckload logistics software. With an easy to use interface and customizable options that reflect a company's particular shipping needs, TL shipping software offers companies an increased range of shipping options at a lower price than third party logistics.

Perhaps the greatest advantage of third party logistics is that allows companies to be free of the logistics process. However, the price that companies can pay for this negligible freedom can be costly. Management based third party logistics providers make their money by acting as middlemen between shipping companies and carrier companies, securing rate discounts from carriers and charging clients a significant amount above the actual shipping cost in order to make a profit. But in additional to simply costing more money than using logistics software, third party logistics poses another problem: because management based logistics providers only work with carriers that offer preferred discounts, they potentially exclude carriers that could offer their clients the best overall shipping solutions. When companies choose logistics software instead of renewing their contract with a third party logistics provider, they have the opportunity view a full rage of shipping options and choose those that benefit them and not a third party's business interest.

When you consider the factors that go into determining the best TL shipping solutions, that management based third party logistics providers only consider carriers that offer a preferred discount is shocking. For example, freight optimization, shipping route optimization and the potential for integrated shipping methods are three bargain basement factors that significantly influence the overall cost and delivery viability of a TL shipping solution. Unlike third party logistics, TL shipping software examines these and other factors simultaneously, eventually identifying the best carrier in relation to each factor. Third party logistics is an expense that never goes away. Companies have no insight into their own logistics process and therefore remain trapped at the hands of profiteering logistics experts. But when companies switch to TL shipping software, they don't just get rid of the cost that comes with paying a middleman; the increased range of shipping solutions that they experience allows them to drastically cut their shipping cost. Research shows that companies that implement logistics software can decrease their total shipping costs by 10 percent at the end of one year.

For my company's TL shipping solutions, I use truckload logistics software. If you're interested in doing the same, check out RateLinx.com.

How Does a Logistics Software Solution Compare to Third Party Logistics?

If you're searching for new shipping solutions, you may have encountered the debate that asks: which is more beneficial to the shipping process: implementing a logistics software solution or outsourcing logistics to a third party logistics (3PL) provider? To answer this question, its helps to consider the three things that every company wants out of the shipping process: cost effectiveness, excellent delivery time, and safe delivery of freight. With these things in mind, we take a look at whether a logistics software solution or a 3PL solution offers the greatest value.

Cost Effectiveness

In terms of cost, you'll always pay more to receive a comprehensive, innovative approach to the shipping process from a 3PL than you will to implement a logistics software solution, and the reason why is simple: when you hire a full scale 3PL provider (i.e. a customer adapter), you pay a company to do what logistics software does without employing anyone. In other words, the software allows you to become your own logistics provider. Although other types of 3PL providers can be hired for less than the cost of customer developers (i.e. standard 3PL providers, service developers, and customer developers), they don't provide the same level of service, with standard 3PL providers and service developers only offering specific services, and customer developers handling the full shipping process without proposing new solutions.

Excellent Delivery Time

Excellent delivery time depends on route analysis and optimization, as well as the availability of integrated shipping solutions. In simple shipping situations, route analysis could consist of analyzing route time in relation to distance, road surface quality, traffic patterns, etc., while in complex shipping situations, such as global shipping or moving unfinished products from location to location during the manufacturing process, route analysis could consist of the strategies mentioned above along with developing integrated shipping arrangements that could combine road, air, sea, and rail shipping, or any combination thereof. Improved delivery time can be achieved with both logistics software and 3PL. But logistics software, due to its impartiality, will present a broader range of options.

Safe Delivery of Freight

The safe delivery of freight is achieved through freight optimization, particularly in terms of using the right stacking strategies and ensuring that like products are shipped together. The cost of broken freight is perhaps the least mentioned aspect of shipping cost, and preventing it from happening can be achieved with either 3PL (e.g. standard 3PL provider or service developer) or logistics software. However, unless a shipper is looking for freight optimization alone, using logistics software would be the better choice financially.

In my research on logistics software, I've studied how logistics management software compares to 3PL in numerous aspects of the shipping process.

Hiring a 3rd Party Logistics Provider Vs Implementing Logistics Software

Product transportation is an inevitable part of the manufacturing business. Whether the goods are shipped locally, nationally or internationally, they have to reach retailers in order to produce business. However, as important as transportation is, companies often overlook the opportunity to reduce shipping costs. While the bulk of a manufacturer's bottom line is predicated on the quality and price of its products, reducing transportation costs can reduce a company's operating costs by thousands of dollars a year. Unfortunately, most companies lack the time and resources to determine optimal shipping procedures. That's why many companies now use transportation logistics software to help reduce shipping costs.

Also known as logistics management software, transportation software specializes in offering integrated shipping solutions that are tailored to a company's specific needs. For small companies that have simple shipping procedures, the software can be used to improve delivery time by studying such factors as road construction and highway traffic patterns. But for larger companies whose shipping process is complicated by multiple assembly locations and warehouse needs, the software can combine disparate elements of the shipping process into a single, integrated shipping solution that saves significant time and money.

In many cases, large manufacturers opt to hire a 3rd party logistics provider to implement logistics solutions on their behalf. While studies show that companies can cut shipping costs by ten percent after one year by either hiring a 3rd party logistics provider or implementing logistics software, hiring a logistics provider is more expensive than using this software. Just as logistics experts can act as transportation brokers, determining the timeliest way to get products to retailers and save companies money by eliminating MS software costs, 3PL costs, annual software maintenance costs, gain shares, freight margins and common rate base licensing costs, so can logistics software. The only difference is that logistics software is a more cost effective means of implementing logistics.

One example of how large companies can profit from logistics software involves choosing a more "expensive" means of transport over a less expensive means to reduce overall shipping cost. For example, while air shipping rates are typically more costly than ground rates, companies whose products make various warehouse stops can actually end up paying enough warehouse fees that shipping by air becomes the less expensive option. In addition, by cutting out the warehouse stops, a company's shipping process becomes timelier. An example of how logistics software can benefit small companies can be found in LTL shipping. Companies that commonly ship less than one full truckload of products often ship by mail carrier. However, when a partial load is shipped LTL, multiple partial load shippers share the shipping cost, which can be significantly less than shipping by mail. Whether or not to implement logistics software is not a debate about effectiveness, but about shipping management and cost savings. In terms of the latter, companies always benefit from implementing logistics software versus hiring a 3rd party logistics expert.

The easiest way for companies to streamline their shipping process and reduce shipping costs is to implement transportation logistics software. While some companies hire a 3rd party logistics expert to apply logistics solutions on their behalf, companies that use logistics software receive the same benefits while saving a significant amount of money.

TL Logistics Software - How Does it Compare to Third Party Logistics?

If your company is at the point that it ships enough goods to benefit from truckload (TL) shipping, achieving the optimal truckload transportation management system will require careful consideration, beginning with what logistics option you should choose. In most cases, companies have three basic options for applying logistics to the shipping process: hiring an in house logistics expert; contracting with a third party logistics (3PL) provider; or implementing TL logistics software-also known as truckload logistics software.

If your company feels like other shippers, it would probably prefer to have its own logistic expert on location. But, if adding a $70,000-$90,000 salary to your payroll isn't acceptable, then contracting with a 3PL provider for TL shipping solutions or implementing logistics software are more affordable options.

To understand what you get when you hire a 3PL provider, it helps to distinguish the four types of 3PL providers: standard 3PL providers, which offer basic 3PL services and usually don't feature 3PL as their main function; service developers, which offer a more specialized range of services than standard 3PL providers; customer developers, which manage a company's entire shipping process but don't suggest innovative shipping solutions; and customer adapters, which manage a company's shipping process and propose innovative solutions.

If you were only looking for TL shipping solutions, hiring a standard 3PL provider or a service developer would be the most cost effective option. However, these types of providers typically place their customers with carriers that offer third party logistics providers a discounted rate that they profit from by charging their customers a rate that exceeds it.

If you think that this scenario sounds disingenuous, it is, especially as it places the provider's interests above the customer's in such a way that a customer has little chance of realizing optimal truckload shipping solutions, which is why it turned to the provider in the first place. TL logistics software, on the other hand, removes this situation by doing the work of a logistic expert and allowing companies to become their own logistics provider.

Like a logistic expert or customer adapter, the software evaluates every aspect of the truckload shipping process (i.e. route analysis and optimization, freight optimization, payment arrangements, etc.) and presents companies with a list of ranked shipping options that can be selected through the use of a user-friendly interface. If cost savings is a major goal in your company's shipping process, logistics software offers a dual cost savings approach: it negates the need to outsource logistics and uncovers shipping solutions that offer the lowest price for you shipping needs.

In my research on truckload transportation management, I've studied the value of truckload logistics software to the TL shipping process.