5 Benefits to Outsourcing Your Transportation Management
Premier transportation management has evolved far beyond moving freight from point A to point B by way of truckload, less-than-truckload (LTL), parcel, and intermodal. That’s only part of the equation.
Today, customers demand visibility, execution, and innovative transportation solutions. Companies are leveraging transportation management as a competitive advantage in logistics planning and finding solutions to control costs and get their products to their customers as efficiently as possible.
If you want to think more strategically about your transportation and leverage cost savings, efficiencies, increase speed-to-market, and get more flexibility and visibility, consider outsourcing to a qualified third-party logistics (3PL) provider that can understand your business, help you grow, and eliminate headaches.
5 Reasons to Outsource Your Transportation Management
1. Skilled Knowledge
Partnering with a 3PL provides immediate access to skilled and experienced industry experts and generational knowledge. Couple that with ever-evolving technological components and you gain an extension of your logistics team without needing to have the responsibility of bringing on and maintaining your own logistics team. This is important because:
- There’s less risk involved: You don’t need to manage the headcount.
- It’s faster: You don’t need to train new employees.
- It benefits your growth trajectory and long-term goals: A 3PL can grow with you without you needing to increase headcount as much.
What’s more, leveraging a 3PL gives you access to an army of talented personnel who experience multiple challenges and industry pressures daily. By solving unique problems and applying creative solutions daily, the right 3PL can fix the leak in the roof long before a total replacement is needed.
2. Load Building
Supply chain software has been evolving, and companies can now rapidly gather and analyze data across multiple shippers to bundle their outgoing shipments into full truckloads. The goal is to bring down transportation costs for all shippers and reduce the number of trucks on the road.
This is accomplished by building optimized loads at the lowest cost while still providing flexibility to plan orders and utilize the best routes, regardless of the end destination. This is how small- and mid-size customers can achieve the scale they can't just go out and build for themselves.
Even better, you don’t have to develop such a sophisticated system on your own. You can look to 3PL providers for these solutions. The best collaborative consolidation systems contain four elements:
- Technology to enable collaboration
- Significant volumes of freight activity in key market lanes
- Teams to optimize freight and customer communication and coordination
- A high-velocity cross-dock for physical freight consolidation
Consolidating smaller LTL shipments and other under-utilized truckloads maximizes trailer utilization and keeps out-of-route mileage to a minimum. This demonstrates that to remain competitive with mega-retailers, small- and medium-sized business shippers need to be nimble solution providers.
3. Day-to-Day Transportation Management
Your business shipping may require customizable, technology solutions that can help you transact with carriers as well as pinpoint areas of inefficiency in your supply chain. Luckily, most 3PLs have their own transportation management software (TMS) that helps you manage and automate your company’s transportation processes.
Working with a 3PL provider with a robust TMS can provide cost details, real-time alerts, key performance indicators (KPIs), reporting metrics, and seamless supply chain visibility into every order. Increased visibility ultimately leads to better decision-making. Additionally, visibility of real-time rates for multiple services, modes, and options afford the flexibility to optimize customer requirements and your bottom line.
4. Freight Bill Pay and Audit
Freight contracts (of all modes and services) can be highly complex to manage. The right logistics partner controls costs, highlights savings opportunities, and brings simplicity and clarity to your transportation management spend by eliminating overbilling and paying invoices accurately and quickly.
Skilled 3PLs have the expertise, technology, and processes to investigate a shipper’s bills, compare the rates to those for which the shipper contracted, and uncover mistakes and duplicate bills. Many 3PLs also can compare a shipper’s rates against its peers and identify steps to boost efficiency and improve bottom line profits.
5. Carrier and Vendor Scorecard
A company’s logistics spend is an accumulation of countless daily operations, with a common one being carrier selection. Identifying carriers for equipment, insurance, and qualifications is a huge undertaking. Before you hand your product over to a driver, you need to make sure they’re the right person or company to represent your organization.
Good 3PLs have a fully vetted network of qualified and reliable freight carriers. Because of their qualified networks, 3PLs can help you secure carriers that are most beneficial to you in terms of efficiencies and cost savings. You want a 3PL partner that will leverage carrier selection to meet your specific needs and build strategic partnerships that meet your growth goals.
Set Your Company up for Success With ODW Logistics
Transportation within a supply chain is complex. It involves varying rates, different transport modalities, and a range of levels of quality and service.
ODW Logistics is the preferred 3PL partner for supply chains to help shippers get through challenging times in the freight market. We operate as an extension of your business to control costs throughout your supply chain that deliver you a competitive advantage over your competition.
Our team of experts is here to help you leverage your carrier relationships within the industry so that you find the capacity you need, when you need it, for the best rate. We take a strategic approach to logistics planning and find solutions to control costs and get your product to your customers as efficiently as possible. Our commitment to partnership and combination of technology, team, and process allows us to deliver on our promises.