Reducing Freight Costs Through Outsourced Logistics

How TMS Platforms Reduce Costs for Shippers

More and more, shippers today need more advanced shipping management than the pen and paper methods that are used to get them by.

The trouble is, as an independent shipper, there’s seldom a strong enough need for transportation management to necessitate the purchase of technology to do so.  As a result, your shipping department is run by people who’ve adapted to an old-school method of managing all their shipments – through the use of Excel documents or handwritten notes.

Don’t believe me?  Ask your logistics manager how they keep track of their shipments.  Chances are, it’s some combination of spreadsheets and writing things down, or even just relying on their memory to know what’s coming and going.

That’s just not good enough anymore.

Why Outsourcing is a Win for Your Bottom Line

There can be a depressingly thin line between top-line revenue and your operating costs.  Profitability is sometimes dependent on things like marginal improvements across your entire fulfillment process.

With your logistics team having to keep track of your LTL or TL shipments manually, multiple areas can lead to decreased profit margins.

There’s the insidious loss of time due to manually tracking everything – sure, updating an Excel spreadsheet only takes a minute, but when you’re handling 100, 200, or 300 LTL shipments a month, that’s hours lost each month just typing tracking information into a spreadsheet.

Now think about everything else that happens when you track things manually.  Errors, lost orders, lost paperwork, missing information… Or what happens when the one person who kept track of everything in their head leaves?  How will you handle changes in staffing?  How much time can you spare to train new employees in the complex, handwritten, or manual data entry system with Excel?

Luckily for you, there’s a solution – and it’s simpler than you think. It also solves much more than your employees’ time management issues.

The solution to your logistics management problem is to bring in an experienced team to help.

Outsourcing your logistics management is an effective solution for multiple reasons.  To start, working with a 3PL that’s genuinely dedicated to your business’s success is just plain a smart move.  It’s an asset to your business – the 3PL doesn’t replace your team, it acts as a supplement, letting your logistics team perform better than ever.

They may not know what they’re missing, or what industry access that they could gain through partnering with a third-party logistics company.

• Access to an efficient, modern piece of transportation management software – without having to buy the software yourself. As you manage more and more LTL shipments, or even just a dozen full truckloads, you (or your team) start to feel the pinch of inadequate tracking or data management.  You need sophisticated software to help you effectively manage the many moving parts of your shipping division.  Working with a third-party logistics provider grants you access to their TMS (if they’re using software that has that capability, like what Diversified Transportation Services uses) – and along with access to the TMS comes access to all the information you need.
• Access to decades of industry knowledge and experience – working with a company like Diversified means that you gain access to our team’s extensive knowledge of the freight industry.
  We’re not here to replace your current logistics team – we’re here to assist them by providing the knowledge and skills that they may not have time to gain for themselves.
• Access to carrier rates and options you may not qualify or – or have been aware of – on your own: One of the major, major perks of partnering with a third-party logistics company is that their carrier rates are, generally, going to be better than yours. Think about it – they handle thousands, tens of thousands of shipments a month.  That’s a volume that entices carriers to offer 3PLs incredibly competitive rates that you, with your hundred shipments a month, can’t get.  Plus, thanks to the technology and experience mentioned in reasons 1 and 2, your 3PL consultant can help you find the balance between low cost, speed, and carrier quality that you need to run (or grow!) your business.

Practical benefits to gaining access to TMS technology through your outsourced logistics provider:

Sure, it’s nice to say that partnering with a company to outsource your logistics management can do all these magical things, but really, what does your business stand to gain?

There are some very, very practical benefits your team will realize from outsourced logistics management.

• Dynamic Tracking and Tracing: in today’s ever more connected world, your business is behind the times if you’re not able to provide dynamic shipment tracking and tracing. That access to advanced transportation management software I was just talking about?  It grants you the ability to see this for your own business – as well as provide it to your customers.
• Instantaneous Rate Quotes: Tired of having to play phone or email tag to get a freight rate quote? You don’t have to anymore.  Thanks to that TMS technology I mentioned before, your customers (and your team) can instantly generate their quotes.
• No more calling for quotes on your “vanilla” shipments: Save time on all of those routine shipments you make every week. Instead of having to call (as nice as it is to chat on the phone), with a few simple clicks, you can get quotes and book shipments.
• By providing instant rates and transit times, your sales team can close more deals: How often has your sales team complained that they can’t close deals if they can’t tell prospects when their shipments are likely to arrive – or how much it costs to ship? The longer it takes your team to provide information to potential customers, the less likely they are to close a deal.  Remove a barrier to purchase, and give your sales team access to the information they need.

Have you heard enough yet?

If you’re ready to partner with a company that’s out to help your business succeed, not just generate quotes, let’s talk.  Our experienced sales team can show you what our transportation management system is like – letting you see for yourself the abilities you’ll gain access to if you work with us.