Entrepreneurs, start-ups and small businesses: when it's time for next-level logistics, here's what you need to know
It’s your own venture! It started as a great concept and now has grown into a full-fledged, successful company. It’s an exciting time for a business. So many things to think about: hiring more employees, purchasing warehouse space and maybe even expanding into a new location. One of your biggest hurdles now is ramping up your logistics. Shipping your goods to customers may be becoming increasingly difficult, complex and time-consuming, not to mention a continual source of stress. Don't wait until you start disappointing customers with late deliveries.
Important Tip #1: SHOP AROUND
Now is the time to consider outsourcing your logistics to a reputable third-party logistics company, or 3PL. They provide the expertise and the scalability you need at this critical time in your business’s growth. You need to focus on your business, not your shipping. So where do you start? You should begin by shopping around. There are thousands of 3PL's and they all offer different levels of service, pricing structures and value-added services. You need the one that's the right fit for you.
Interesting Fact: U.S. companies spent 1.5 trillion on logistics in 2017 (source: CSCMP State of Logistics Report)
“I have customers that think of us as their complete freight management team, not just a broker or 3PL,” says Ashley, one of Choptank Transport’s account executives. “I make sure I know everything about my customers—what their inbound freight is and what we need to do to make sure our outbound pickups coincide with their needs. They count on us to be their logistics expert for everything from billing to shipping to helping with any overages, shortages, or damages – basically, we handle it all!”
Important Tip #2: ASK ABOUT SERVICES
As a small start-up, you are probably only shipping a pallet or two of product at a time, which means you need a 3PL that offers less-than-truckload (or LTL) shipping. If the same 3PL offers additional services, such as truckload and intermodal, it will be easy to scale up your logistics as you grow. Shippers sometimes forget to ask about the intermodal (rail) option for their shipments when often it can save them money. Always ask your 3PL what services they provide and to quote as many ways as possible when giving you rates. For example, if you have LTL freight, does shipping it on one week save you money over another, or if you have a truckload of freight, can you split it into several LTL loads and save money?
Important Tip #3: ASK ABOUT CARRIER VETTING
Using a 3PL means you don’t have to worry about the maintenance of owning your own trucks, or the headache of hiring drivers (especially with the current driver shortage). Also, carriers that are used by 3PL's are carefully vetted and checked for: phone and address verification, carrier safety ratings, current insurance, FMCSA and DOT compliance and any fraudulent activity reports. Be sure to ask about a 3PL's carrier vetting process.
Important Tip #4: ASK ABOUT TECHNOLOGY
Make sure the 3PL you choose is using the latest technology to match freight so they can locate a truck for you that has the right kind of equipment (refrigerated or dry van), for the best price, in the right time frame. Also, make sure their technology allows for track and trace so you know where your cargo is at any given time during its transport. Find out if the 3PL you’re researching has invested in the latest technologies. For example, do they know what TMS means (Transportation Management System) or EDI (Electronic Data Interchange)? What are their track and trace capabilities?
Transportation Management Systems are important for 3PL's because they streamline the shipping process and provide efficiencies that can save you significantly on time and money. If the 3PL you are checking out doesn’t have a TMS or know what it is, you should probably move on to the next candidate on your list.
Track and trace capabilities are also an important factor when choosing a 3PL. Using GPS technology and other location software, such as Trucker Tools and Macropoint can give the customer true visibility into each and every shipment. Temperature-monitoring devices such as Locustraxx and TempGuard can provide real-time temperature for refrigerated and frozen freight. If you are a shipper that needs to know where your freight is at all times, technology should be at the top of your checklist.
By doing your homework first and asking the right questions, finding a good transportation provider that fits your needs shouldn't be difficult. It should make your life easier and provide you with an economical, reliable and long-term solution.