Get Better LTL Rates Through a Third Party Logistics

Are you looking for a better rate on your shipping? Have you been confused about the whole situation and don't really know who to ask what is best and want a third party to tell you what will work best. I will tell it is not easy to find a good logistics company. But there are things you need to look for in a good third party logistics company. Here they are in the best order of importance. First you want to find one with the best rates. Now I know that this sounds obvious but there is some companies that have a lot to offer besides rates. Now rates can vary carrier to carrier. The logistics companies will have different rates with each carrier. So I would say that it would be best to have a couple third party logistics companies and compare them on every shipment. There is no rhyme or reason to it, I honestly don't know why some are cheaper and some are more expensive. It is just best to compare and over time you will find out which third party logistic company is better for which area of the country.

Second thing in order of importance is ease of getting the quotes. If you are reading this article good chance you know how to use a computer and this is not an alien machine to you. So the third party logistics company must have an easy to use online software. If you have to call it in this is an adequated system. The best companies have a way to get a quote in less than 1 minute online. This is important for 2 reasons. First time is always of essence when trying to quote a number of different things on different third party logistics websites. And most important, if your sale depends on the shipping price of an item you don't want to have call your customer back because you have to get off the phone to get a quote. You could lose the sale with that couple minutes of time for your customer to think it over. You don't want them to occupy their time with something else. A sale can be lost in this short amount of time. Honestly they could not even answer the phone if they wanted to. So this is very important and make sure you can get the quote online.

The last important thing is service. You don't want to have to wait on hold for ever if you have an issue. This is not something that works into productive time in your day. Don't want to have a crick in your neck for holding the phone for too long. If the third party logistic company doesn't answer with a genuine person on the other end. They don't deserve your business. If you have to leave a message for them to get back to you, they are understaffed.

George Martins has been a working for a third party logistics company for over 15 years. Knows many things about the industry and has an extensive knowledge of how the current economic situation is affecting the freight shipping industry. To learn how to get better freight rates please come to [http://www.savemoneyonfreight.com]

The Disadvantages of Hiring a Third Party Logistics Service

Whether your company ships its products locally, nationally or globally, the price that it pays for shipping depends heavily on logistics. From fuel surcharges to warehouse fees, logistics management focuses on every aspect of the shipping process in an attempt to accomplish two things: the delivery of products in a shorter period of time and the delivery of products at the lowest cost of shipping. To accomplish these goals, many companies turn to a third party logistics service (3PL); a company that works with small to midsized companies to transport their freight by land, sea or air. In most cases, 3PL's make the majority of their profits by consolidating freight from different companies and receiving discounts from less than truckload carriers (LTL), airlines or expedited shipping companies, meaning that 3PL's essentially profit from not passing discounts on to their customers. Nevertheless, 3PL companies do provide an essential service for companies that can't afford their own shipping fleet or full truckload shipping (FTL). In fact, the only way that most small to midsized companies could do without 3PL is if they had the ability to conduct their own freight logistics.

Today, small to midsized companies have this ability when they choose freight logistics software over hiring a 3PL. Freight logistics software-also referred to as freight transportation software-has several advantages compared to 3PL, with the most obvious one being price difference. Freight transportation software is an online computer application and is priced accordingly, whereas 3PL providers serve as logistics experts and cost significantly more. Another financial advantage of freight transportation software is that you aren't dealing with a logistics provider that makes money off of the price differential between what you pay for logistics and the actual cost of shipping your goods; instead, you're dealing with a freight logistics software company that makes money by providing a software application for a monthly fee, which essentially means that you cut out the middle man and reap the full financial benefit of logistics.

Although 3PL providers do help companies ship their goods in a timelier, less expensive manner than if they shipped their goods using parcel carriers or FTL providers, 3PL nonetheless profits off of companies whose size necessitates that they look for the most affordable shipping options, including the price required to discover and secure those options. By using freight transportation software, small to midsized companies can realize the same logistical benefits provided by a third party logistics service at a significantly lower price, as well as exert more control over the logistics process. As an online software application, freight transportation software can be accessed from any online computer terminal, allowing each of company's departments to apply its expertise. Whether you ship your products locally, nationally or globally, freight transportation software puts the power of logistics in your hands in an easy to understand module, allowing your company to reduce its shipping costs by as much as 10 percent after the first year of use.

As the owner of a midsized furniture company in the Midwest, I once used a third party logistics service to handle my shipping needs. But then I found out about logistics software, which allows you to make your own educated shipping decisions and save money by cutting out the middleman. I'm telling you about logistics software because of how much money it can save you, money that has helped keep my business up and running in hard times.

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.

3PL Warehousing - What Is a Third Party Logistics Warehouse and How Can It Help Grow Your Business?

Every successful business has a core competency, and the best leaders within these businesses also recognize which areas are not core competencies and in the product business, this is often warehousing and transportation. In short, 'what you do' is not warehousing and distribution, you need someone that does it better than you.

Outsourcing warehousing and distribution of your products could be the right answer for any emerging business looking to realize efficiencies and cost savings. Business leaders make the same decisions in other functional areas - like payroll processing, advertising services, and computer maintenance. In this latter area, manager's ask, "Do I need an IT department of 20 people or of only 2 people, and contract out the rest - scaling up in times where special projects are being executed and down when demand is less.

Warehousing and Distribution - Leverage the Power of Scaling to Meet Business Needs

The 'build versus buy' question is one many executives contend with, and when it comes to warehousing and distribution, the capital requirements of securing warehousing space and or a distribution (often truck) fleet is astronomical. What if sales don't meet forecasts? What if supply is severely constrained? What if inventory is depleted too fast? In each of these scenarios, you will have some combination of under or over capacity on the warehousing and on the distribution-transportation size.

With an outsourced third party warehousing and distribution solution, that is, 'pulling' resources when you need them and in the quantity you need them, means you're always right sized. Yes, it is possible to have your capacity shift with your business needs. What happens when you do this is smart business and it helps align expenses with revenue curves - cost is incurred when business activity - principally revenue - generates it.

Third Party Warehousing and Logistics is for Big and Small Business Alike

If you believe a big company should own its own warehouse or if you think small business operating from a basement warehouse is too small to outsource anything - think again! Large corporations place big emphasis on capacity utilization - arguably a fundamental metric of any company. In small growing businesses, there comes a point where what started to make it successful diminished. Why? Not because the market opportunity has changed, but because the business owner who focused on marketing and sales no longer has the time for, you guessed it, marketing and sales. Outsourcing might seem like a cost addition compared to a home basement and garage warehouse situation, but 'bigger thinking' entrepreneurs know that their time has to be spent nearly entirely in places that add value and drive growth.

Whether you're a business manager in a large company or a start-up, outsourcing warehousing and distribution services to a third party provide can make good sense. The challenge? Investing the time to explore a cost-benefit scenario that accounts for the real (hard and soft) costs of warehousing and distributing your products in-house.

Service Freight Warehousing provides outsourced warehousing and distribution services. Free quotes are available to growing businesses seeking to leverage outsourced warehousing and fulfillment services. Warehouse services for local Canadian and U.S. business clients are provided for distribution from Greater Toronto, Ontario Canada warehouse distribution facilities. Visit http://www.servicefreightwarehousing.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.

Researching Third Party Logistics Providers

In today's fast paced business world it is increasingly important for companies large and small to examine their supply chain processes. More often than not, outsourcing logistics functions will produce optimal results. Third party logistics providers can be the most important service providers to any business. Contrary to making transportation decisions in the past, a manager has many choices which differ drastically. Competition is alive and well in the 3PL field. With so many emerging service providers and such a large variety of service 3PL's offer, it can be confusing to choose the right one for your needs. Rising fuel prices, industry regulation, and the customer's desire to receive orders rapidly are all reasons logistics decisions are vital to the health of a company. Due to the complexity of modern day logistics, a manager must have a clear understanding of the options. One key reason for outsourcing is to save managers time that should be utilized elsewhere. So what can a manger do to understand all their options and still save time? Much of the information a manager needs is located on third party logistics provider's websites or can be found with light internet research.

All reputable service companies should have an informative website. Sometimes a manager can feel like they are drowning in information that doesn't really pertain to them. It helps to know what particular information you hope to find from their website. Here are a few keys aspects to help guide your research.

Ensure that a company can fit your needs

Services offered would be the first thing a manager should examine. Larger 3PL's may offer everything you can imagine, but do they offer the flexibility you need? Well established companies tend to have a very strict process which may force you to adjust transportation strategies. Mid-sized to smaller 3PL's will often offer flexibility and problem solving solutions you appreciate, but only have limited service offerings. A service provider's websites should give you a good overview of all they have to offer.

Once a manager finds a company that offers the services their company needs, the next step is looking at the industries the 3PL already serves. Although many companies will venture into new industry in the name of growth, it is best to find a company that already works with your industry. Most 3PL's make this section of their site very easy to spot if it's not the first thing you notice.

When a manager finds a 3PL that services their industry with the services their company needs, they should look at the locations of that 3PL. Service providers with a large global network tend to make this very easy to find on their website. Smaller companies who target specific areas will focus on these areas throughout their website.

Look for Examples Provided by Company

Third party logistics providers often provide potential customers with examples of great work their companies have completed. Their websites tend to label this differently. Some examples of these labels might be white papers, case studies, or success stories. Other websites may just incorporate these examples into their opening or "about us" sections. This information is paramount to understanding a company's flexibility and contingencies plans. What they've done in the past is a good indicator of how they will handle issues in the future.

Check Companies Reputation

A company's reputation can be a good indicator as to what level of service you can expect to obtain from them. Managers will need to research slightly outside the company website to examine how well they have performed in your industry. Managers can be flooded with information when they begin to search for this information. Limiting your search to only the most reputable trade magazines and associations is essential.

Trade magazines and associations provide a good starting point for examining the reputation of a logistics company. Many magazines rank companies based on one metric or another. This list can be a useful tool to compare companies. This may be a good start but as one reads through this list the reader should notice the metric in which they are being ranked. Keep in mind that the company with the largest revenue may not always fit your needs best.

Using trade magazines, associations, and the company's website it is likely that you can also build a list of companies that do business with each 3PL. This is valuable information when investigating the reputation of a service provider. A manager can research those companies to see if they have delivery issues. This is easily done in today's world of complaint forums, news sites, and blogs. A quick email to the transportation manager of these companies may also yield valuable information. If they are not happy with the service they will let you know right away and usually give details as to why. Keep in mind that people are not as quick to tell you when a company has treated them well so weigh the information of 3PL's accordingly. Also if not provided by the 3PL's website a manager could call the service provider directly and ask for their historical error information.

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.

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.

Choosing the Right Third Party Logistics Provider

Logistics management has become a corporate focal point as companies look to trim costs without compromising safety and service. More C-Level professionals are realizing how successful supply chain management can significantly contribute to bottom line performance. Lean, efficient, reliable supply chains can translate into savings of up to 15-20%.

Receiving and delivering your freight intact and on time is vital to the sustainability of your business. Improving and maintaining service levels enables you to sustain your customer base and attract new business to increase market share. How do you compare to your competitors? Is your service top notch? Examining and refining your logistics management practices can make all the difference.

Effective supply chain management requires strategic and tactical approaches. It is often nearly impossible to handle all of this in-house effectively. 3PL providers handle the logistics management so your company can focus on quality products, service and smooth operation.

A good 3PL provider utilizes the latest technology to provide clients with exceptional analytics that can lead to greater operational insights. Using sophisticated software and supply chain expertise, your company can work with your 3PL to identify opportunities for operational improvements.

Successful logistics management is about details. Working with clients and carriers, moving freight and ensuring smooth operations requires strong leadership and flawless execution. The ideal 3PL excells at all of this and employs experienced and highly trained transportation planners. These planners partner with your transportation and customer service staffs and act as an extension of your business.

Effective logistics management can bring about competitive differentiators. Successful supply chain management leads to lower costs and improved service. Both rely on choosing a quality 3PL provider.

About the Author:

Kerry Schoemehl works for LMS Logistics, a non-asset-based third party logistics firm based out of St. Louis. LMS is one of the top 3PL firms in the industry, bringing freight management solutions and savings to such companies as BASF and Monsanto.

Schoemehl has exceptional knowledge and experience in the field of transportation logistics, and is happy to share her expertise with others in the industry. If you enjoyed this post, check out the LMS blog at http://blog.lmslogistics.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.

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.

What You Need to Know About Third Party Logistics

If you happen to have a business in Los Angeles for which you would need a warehouse or warehouse related services, you must have come across a Los Angeles contract warehouse which also claim to provide Los Angeles 3PL. 3PL or third party logistic providers offer warehousing, cross docking, freight forwarding, inventory management and transportation services, or other service involved in the supply chain management functions.

The services they provide can be customized or scaled according to the market conditions or customers demand. The third party logistics allows the company to remain competitive without owning much assets and resources. This reduces a lot of operational cost for the client company.

As IT brought on a huge boom in globalization, the concept of third party logistics evolved in the 1980's. You must have seen a lot of third party logistic companies such freight forwarders and courier companies, and there are others which incorporate subcontracted logistics and transportation services. Most of these companies such as DHL, UPL and TNT logistics emerged during this period.

Types

Third Party Logistics can be classified into four categories:

• The first is the standard third party logistics provider. These are the logistic providers with the most basic activities like warehousing, pick and pack and also distribution.

• Service developers are based on a strong IT infrastructure. They also provide the clients with many value added services such as tracking, cross docking, specific packing or unique security system.

• Customer adapters are the logistic providers. They take care of all the company's logistic activities on the request of their client. They do not develop or change any activity or process.

• Customer developers take complete control of the company's logistic functions. They integrate themselves into the company and might also change the process if needed.

Usage

Third party logistic services or application are mainly needed for firms which may be too big or have a wide complex network. Therefore, logistics does not need to be the main focus or competency of many firms. In addition, these services are not needed at the time of acquisition of another firm or at the launch of a new product.

Advantages

Third party Logistics offer several advantages to a firm in different ways. A firm can focus more on its other main objectives rather than the logistics, hence strengthening its core competencies. In addition, the logistics provided by a third party may cost lesser as the resources are not needed to be bought or rent. Plus, a logistic provider may offer more expert and specialized logistic services to improve the company's competitiveness.

Disadvantages

Despite their many advantages, third person logistics may not be able to do all the things a client might expect from it. There are some limitations and some risks as well. One of them is that the firm itself loses all or most of the control of its logistics functions. Another is that a difference of opinion between the firm and the third party logistics provider may occur, thus hindering the overall logistic process and function.

Connor Sullivan recently stored the overstock from his store in a Los Angeles contract warehouse. He uses a Los Angeles 3pl to transport his products to the vendors.