Third Party Logistics (3PL): Common Misconceptions
3 minute read
What is a freight broker or a 3PL (third party logistics) provider?
For the most part, the terms are interchangeable–both work as intermediaries between a shipper and a trucking company. Since deregulation, the number of freight brokers has skyrocketed. Today there are nearly 18,000 registered freight brokers or 3PLs operating in the United States.
A freight broker or 3PL can offer a lot of bang for your hard-earned buck in a rapidly changing logistics landscape. And still, shippers are often wary of working with freight brokers. Most often due to some common misconceptions we will address here.
Common misconceptions about freight brokers or 3PLs.
Lack of communication.
If you are a shipper, and your only contact with a 3PL occurred when you had a last minute load dropped, you may have worked with a less-than-trustworthy broker looking to make a quick buck on your misfortune. We like to call these brokers–voice brokers, very small operations manned by one or two people with a couple of telephones.
Here’s what we’ve found. When you work with a 3PL like AM Transport, you work with experts who treat consistent communication as a #1 priority. We don’t only answer our own phones, we answer them 24/7/365 days a year. We’re available to shippers and carriers to answer questions, create solutions, and offer updates and necessary information.
Lack of technology.
If your broker isn’t communicating very well, it’s quite likely that their technology isn’t up to speed either. We see this all the time.
However, recent advances in technology, including the advent of wide-spread cloud computing, have drastically reduced the capital a 3PL needs to harness the power of innovative technologies that can streamline processes for shippers. Here at AM Transport, we operate a state-of-the art TMS; provide our customers and carriers with a portal that offers personalized views, 24/7 tracking, load information–appointment times, PO and reference numbers, instant messaging, and up-to-date market information; and create technology solutions unique to customer needs.
Most brokers are non-asset based. This means they do not have trucks of their own and because of this shippers often believe they lack capacity and feel that working directly with carriers is in their better interest.
Limited capacity isn’t a problem when you work with a 3PL like AM Transport Services. With nearly 30 years experience in the business, our team has long-term relationships with the best group of small-to-midsize carriers in the transportation world. We can put fleets you would never know about into service for you. And this has never been more important due to a continuing driver shortage. Our strong relationships mean that these carriers and their hard-working drivers want to work with us, and they want to work with you too.
Sure, if you are working with an old-time freight broker operating out of a basement office with a telephone or two, you might experience a lack of communication, lack of technology, and limited capacity. But when you work with AM Transport Services, you work with experienced professionals, folks who will change your mind about the benefits of working with a 3PL. Give us a call today for more information about our managed freight services. When we handle the logistics, you are a hero to your customers and carriers.