Companies often struggle with transportation since order volumes and timelines are constantly changing. As a result, companies are left with slower and more expensive shipments.
However, 3PL services offer a unique service in dedicated transportation designed to ship things more efficiently and affordably.
What Is 3PL?
A third-party logistics company or a 3PL is a company that specializes in logistics processes, including but not limited to transportation, warehousing, and fulfillment.
Companies outsource these logistics processes to these specialized providers for a more efficient and cost-effective approach to logistics. When companies outsource these processes, they can focus more of their attention on other business aspects.
For example, let’s say that Company A doesn’t work with a 3PL.
In terms of transportation, they have to purchase their own fleet, hire their own drivers, and perform maintenance all on their own.
In terms of warehousing and fulfillment, this means that they have to purchase or rent their own warehouse space, hire their own workers, pack their own orders, and ship their own packages.
Additionally, these logistics processes require various technological tools, which Company A would also have to purchase.
Now, Company B works with a 3PL to handle the transportation, warehousing, and fulfillment. Company B simply has to ship their products to the 3PL’s warehouse, which is then received.
The 3PL likely provides a tool that can integrate with Company B’s order system so that when an order comes in, they can see it and get started with the picking, packing, and shipping process.
Then, the 3PL prints a shipping label based on an existing partnership when the order is ready. When the order is finally ready for transportation, the 3PL has a carrier ready to go, thanks to their existing and extensive network.
As you can see, Company B does a lot less work than Company A and can likely focus on other things like product development, marketing, and customer service.
What Is Dedicated Transportation?
Dedicated transportation is a type of service wherein a company can secure consistent shipments by contracting out to a 3PL. Dedicated transportation is in contrast to spot transportation, wherein a company only secures transportation for shipments as needed.
How Does Dedicated Transportation Work?
Since dedicated transportation has to be consistent, it is usually only reserved for shippers with at least one load per week in each shipping lane for at least one year. The shipper is then charged a fixed rate for the duration of the contract rather than having to pay fluctuating market rates.
What Are the Benefits of Dedicated Transportation?
The benefits of dedicated transportation could totally change the way you do business for the better. Here are just a few reasons why you should consider making the switch to dedicated transportation:
Capacity Guarantees
With dedicated transportation, a transportation provider guarantees that they will have the capacity to handle your loads. That way, you won’t have to worry about securing extra loads during your busy season or even during an unexpected increase in demand.
Instead, the transportation provider handles everything for you to focus on more important aspects of your business.
Improved Care During Handling
When you use dedicated transportation, you’re able to work with a transportation provider that knows your loads and is familiar with any special care requirements.
From there, they can work to secure qualified and trained drivers to handle your shipments with care, giving you the peace of mind that your shipments are always in the right hands.
Less Management Required
Less management is always a good thing, and this is just another benefit of dedicated transportation. Dedicated transportation takes the bulk of the effort out of your hands.
It puts it into the hands of experienced and professional transportation providers that can efficiently handle the entire shipping process from beginning to end.
Better Predictability and Reliability
In today’s shipping industry, driver shortages and truck shortages often result in less reliability and predictability.
However, reliable transportation allows you to effectively bypass these concerns with a transportation partner that’s ready and willing to leverage their network to meet your shipping needs, whatever they may be and however they may change.
How Can 3PL Help With Dedicated Transportation?
A 3PL has a unique ability to help you with dedicated transportation by providing you with more resources, less risk, more flexibility, and lower costs.
Resources
3PL companies are able to provide you with access to more resources. This is because 3PL companies have extensive networks of drivers that they work with to handle client shipments.
For example, RPM has a network of over 30,000 carriers that can provide a wide range of different shipping services, including but not limited to less-than-truckload shipping, full truckload shipping, expedited shipping, intermodal shipping, and drayage.
Reduced Risk
Using a 3PL company for dedicated transportation also helps you reduce risk. For starters, all of these companies are fully licensed and insured. Furthermore, the best 3PL companies only work with experienced carriers with stellar safety records. These requirements and safeguards are designed to increase safety and reduce risk.
More Flexibility
No matter how much you try, you can never predict the future, which is why working with a 3PL for dedicated shipping is so valuable. If anything changes, 3PL companies can roll with the punches and find a transportation solution to meet your changing needs. This flexibility provides you with what you need to run your business without worrying about logistics.
Lower Costs
Working with a 3PL to secure dedicated transportation may also come with lower rates. Shipping rates are constantly changing, and there’s no easy way to calculate them ahead of time.
With dedicated transportation, however, you’re able to get more consistent pricing thanks to your more consistent loads.
That way, you always know what to expect in terms of price, and you don’t have to worry about market fluctuations impacting your bottom line.
How Do I Choose a Reliable Provider?
While 3PL companies can completely change how you ship your products, not all 3PL companies are created equal. So if you want to take full advantage of all the aforementioned 3PL benefits, you need to choose an experienced and reliable provider.
Step 1: Locate Potential Providers
First, you need to locate potential providers by either asking for personal recommendations or looking online. If you can get a personal recommendation from someone you know, that’s great!
However, it’s still a good idea to look online for other providers to add to your list of contenders. Simply search for “3PL providers” on a search engine and note the first few results.
Step 2: Research Potential Providers
Next, you need to conduct more in-depth research into your shortlist of potential providers. A great place to start is with the Federal Motor Carrier Safety Administration’s database that allows you to access licensing, insurance, and safety information.
After that, you need to check customer reviews on third-party review websites like Google, Yelp, and the Better Business Bureau (BBB). Just keep in mind that one or two negative reviews shouldn’t automatically disqualify a potential provider from your list.
On the other hand, multiple negative reviews or numerous reviews mentioning the same issue would be a red flag.
Step 3: Consult With Potential Providers
Based on your research, you should be able to narrow down your list to a few final contenders. You should then reach out to these companies directly to discuss your dedicated transportation needs.
Come prepared with basic information about what you’re shipping, when, where, and how often. Each provider should tell you if they can meet your needs and how much it will cost.
Step 4: Choose a Logistics Provider
Finally, it’s time to decide on a logistics provider. Remember to take all factors into account, and not just price. You should be wary of a quote that’s substantially lower than the rest.
The Bottom Line
If you’re looking for a 3PL provider who meets these qualifications, look no further than RPM. RPM is a top logistics provider that specializes in vehicle and freight transportation.
Thanks to a network of over 30,000 monitored and vetted carriers; RPM can quickly and affordably meet a wide range of shipping needs from many different industries.
RPM boasts a 98% on-time delivery rate and prioritizes service with dedicated customer support representatives, pricing matrices, and a carrier monitoring system.
Contact RPM today to find out more about dedicated transportation services.
Sources:
Guide to 3PL Logistics | Business News Daily
Why Logistics Technology Matters | Forbes
Licensing & Insurance Carrier Search | FMCSA
