The amount of money that a company spends on its shipping process is defined by several factors. But regardless of a company’s shipping needs, the cost of its shipping process will ultimately depend on how it handles transportation logistics.
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When it comes to choosing a freight management service, shipping companies have three basic options: they can hire a team of in house logistics experts; they can outsource their logistics to a third-party logistics (3PL) provider; or they can implement logistics software-also known as full truckload logistics software, freight transportation software, and freight management software.
In most cases, only large companies that send a high volume product and have its own delivery fleet hire a team of logistics experts houses, while small to midsize companies choose between the 3PL and logistics software to save money.
Traditionally, small and medium companies have been outsourcing their logistics requirements to 3PL providers. But the economic benefits offered by logistics software now makes it a better option to hire a 3PL provider, and even to employ in house logistics professionals.
When companies partner with 3PL, they should be careful about what kind of 3PL they choose. There are four basic types of 3PL providers: standard 3PL providers, service developers, customer adapters and customer developers.
Standard 3PL providers and service developers usually offer the lowest price. But there are good reasons why: none offers comprehensive, innovative approaches to the delivery process, rather than offering a small variety of services to companies with special needs.