The disadvantages of hiring a third-party logistics service
Whether your business ships your products locally, nationally, or globally, the price you pay for shipping largely depends 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: delivering products in a shorter period of time and delivering products at the lowest shipping cost. . To achieve these goals, many companies turn to a third-party logistics service (3PL); a company that works with small and medium-sized businesses to transport their cargo by land, sea or air. In most cases, 3PLs make most of their profits by consolidating freight from different carriers and receiving discounts from LTL carriers, airlines, or express carriers, which means 3PLs essentially profit. of not passing the discounts on to your customers. However, 3PL companies provide an essential service for businesses that cannot afford their own shipping fleet or full truckload (FTL) shipping. In fact, the only way most small and midsize businesses could do without a 3PL is if they had the ability to do their own freight logistics.
Today, small and medium-sized businesses have this capability when they choose freight logistics software over hiring a 3PL. Freight logistics software, also known as freight forwarding software, has several advantages compared to 3PL, the most obvious being the price difference. Freight forwarding software is an online software application and is priced accordingly, while 3PL providers serve as logistics experts and cost much more. Another financial advantage of freight forwarding software is that you are not dealing with a logistics provider that makes money on the price difference between what you pay for logistics and the actual cost of shipping your products; 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 you cut out the middleman and get the full financial benefit of logistics.
Although 3PL providers help companies ship their products in a more timely and less expensive manner than if they shipped their products using package carriers or FTL providers, 3PLs benefit from companies whose size requires them to shop around for shipping options. more affordable, including the price required to discover and secure those options. By using freight forwarding software, small and medium-sized businesses can obtain the same logistics benefits provided by a third-party logistics service at a significantly lower price, as well as exert greater control over the logistics process. As an online software application, freight forwarding software can be accessed from any online computer terminal, allowing every department in the company to apply their expertise. Whether you ship your products locally, nationally, or globally, freight forwarding software puts the power of logistics in your hands in one easy-to-understand module, allowing your business to reduce your shipping costs by up to 10 percent after the first year of use.