The first step in determining the best shipping method for your freight is learning the difference between an LTL carrier and a 3PL. In this post we will explore the Less Than Truckload (LTL) carrier, the third-party logistics (3PL) provider, and the distinctions between the two.
What is an LTL Carrier and What Does it Do?
Moving goods by truck offers far greater flexibility than shipping by other modes of transportation with more fixed scheduling, such as rail. An LTL carrier offers space to a variety of customers whose shipments don’t need a full trailer, resulting in a truck carrying a mixture of palleted goods. Carrier specializations include time sensitive delivery services, protection for refrigerated or frozen goods, residential services, and more.
LTL carriers navigating the nation’s expressways typically use “pup” trailers capable of hauling two enclosed 48- or 53-foot trailers in tandem for greater ease when dropping off freight, and will typically only accept shipments small enough to fit in one trailer. Shipments are categorized for delivery to thousands of coordination terminals strategically located around the country as part of a hub-and-spoke delivery system. During their journey across the country, shipments heading to a common delivery location get combined at these terminals. Local LTL shipments are delivered by shorter trucks that are easier to maneuver and weigh less due to no sleeper births.
Weight, freight class, the “lane” i.e., zip codes for pick up and drop off, and any additional services determine LTL freight rates, along with fuel surcharges based on national weekly average of diesel, which are determined by shipping lane and added to costs for line hauling. Discounts can be offered to brokers and shippers by carriers willing to negotiate in order to gain new business. A common offer is for freight of all kinds (FAKs) classification putting freight in a lower rate class. While this can sometimes give the perception of reduced shipment cost, knowledge of past shipping costs via a freight analysis can help a shipper achieve the best possible savings.
In the Untied States alone, there are over 45,000 freight carriers moving goods every day. Some businesses choose to work exclusively with one or more carriers directly. Each time they want to book and LTL shipment, they’ll contact that carrier and get a rate for the shipment.
What is a Third-Party Logistics (3PL) Provider?
A third-party logistics company typically offers multiple transportation logistics services to end users (shippers) including: LTL, FTL, Partial Truckload, and warehousing. Many businesses prefer working with a 3PL (like Amware) because a 3PL will offer shipping customers price quotes from all of the major carriers rather just one or two.
Obtaining shipping quotes and researching shipping cost history with each carrier individually can be a daunting and time-consuming task. Additionally, shippers who choose to deal with one or two carriers directly may or may not be receiving favorable rates on their LTL shipments. Amware empowers its shipping customers by offering use of their proprietary transportation management system – Amrate. The Amrate platform identifies the lowest cost carrier for your freight shipments and provides everything from shipment tracking and tracing, freight bill audit and payment, and customized reports to real-time carrier management and claims resolution. Additionally, Amrate consolidates all of your freight quotes.
To request a free trial of our newly updated Amrate 7.0, click below and start saving time and money on your LTL shipments today.