Easy checklist for sourcing a top 3PL

Posted by Harriet Mills on Mar 28, 2019 3:59:26 PM

Do you get annoyed with your current transportation provider because when you call, they don't know where your shipment is? Are they consistently failing on delivery promises while slowly hiking up your prices?

 If you are experiencing any of these frustrations , it's time to make a change and outsource your freight with a new 3PL. There are almost 20,000 freight brokers in the United States, so this can be a daunting task. Where does one start?

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Begin your research by thinking about what problems a 3PL can solve for you, specifically, and what outsourcing with the right provider could mean for your company.  3PLs should provide more than just a freight rate. Once you start digging in, you may be surprised at the number of value-added benefits that some 3PLs provide that align with your shipping needs.

 

What are the critical questions you should ask when interviewing a new provider? Your primary goal should be to confirm that your needs are a good match for their list of services. Do you ship truckload, LTL or intermodal

 

CAPACITY

Acquiring transportation services when capacity is tight can be close to impossible, especially if you aren't using a 3PL to help route your freight. The trucking industry is in constant flux, meaning you can't always count on adequate capacity. There will be times when finding a truck at the right place, at the right time, with the right equipment, is difficult. 

 

If you have a product ready to ship, especially perishable goods, delaying or storing it is not an option. That’s when a 3PL’s vast pool of vetted carriers comes into play. If a capacity shortage does occur, your chances of getting your shipments covered are much greater if you're working with a reputable transportation provider who has contracted, reliable carriers at their fingertips with pre-negotiated rates. So here are the important questions to ask your salesperson.

    How many carriers do you have in your database?

    How do you secure capacity in a tight market?

    Do you offer expedited shipping?

    What other modes of transportation do you offer?

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NEGOTIATING POWER

Top 3PLs work hard to attract and retain thousands of carriers in their database.  Because freight brokers utilize both independent, owner-operators and fleets regularly, relationships become a big part of the transaction. These connections are built over years of using the same carriers for similar lanes and establishing rapport with both drivers and companies. Trust and familiarity become a valuable part of the business deal when it is time to negotiate pricing.

 

Having a large pool of carriers also plays a role in being able to secure the best pricing. If you have multiple carriers to choose from for the same load of freight, you have the upper hand in the negotiation.

    How many carriers are in your database?

    How easily can you find team drivers for long-haul shipments?

    How do you pass on savings regarding current market pricing?

    Do you offer multi-lane, multi-shipment discounts?

    Would I save on contract rates?

    Can other modes of transportation save me money on my freight? 

 

TECHNOLOGY

Technology is one of the biggest differentiators when separating the pros from the amateurs. There are some freight brokers that have invested heavily in the latest supply chain advancements, and then there are those who are still doing things the way they did five years ago. If your 3PL is still operating the same way they were even ONE year ago, they are not keeping up with the industry and their efficiencies will suffer. That means more cost to you. 

 

If you are a 3PL, you also should be a tech company. From the technology that runs the trucks ELDs to the Temptail recorders measuring on-board temperatures, to the predictive analytics that reveal trends in market and capacity data, 3PLs offer knowledge. And knowledge is everything in logistics.

    Do you have a TMS (Transportation Management System)

    What technology do you use to track capacity in my shipping lanes?

    How can I view my shipment in your system?

    What kind of CMS (customer management system) do you use to keep track of my account?

  

COMMUNICATION

With the knowledge gained by technology, the next most important aspect of interviewing a 3PL is reviewing its competency in communicating all this information. Communication is one of the main reasons to outsource your shipping. The amount of data that needs to pass from a shipper to a carrier to a receiver can be mind-boggling. It is not just how much information; it’s also the accuracy of its content. 

At Choptank Transport, we have an after-hours team available during nighttime hours as well as weekends. This added service can be invaluable to shippers, carriers and receivers alike. 

    How do you communicate a problem to your customers?

    If I call at 2 a.m., will a person in an office be available to answer the phone?

    How do you handle disputes such as OS&Ds?

    How knowledgeable are your staff about FSMA rules and regulations?

    Who is my backup if my sales representative is not available?

 

By asking these questions, you should be able to find the perfect 3PL to fit your supply chain needs.  

Tags: Shipper News

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