3PL vs. Freight Broker: Which is Right for You?
The logistics industry is never short of terms and acronyms that can sometimes be confusing for small and medium-sized business (SMB) shippers. Even trickier, some shipping industry terms are used interchangeably when they really shouldn't be. Two prime examples of this jargon jumble are freight brokers and third-party logistics providers (3PLs).
Despite there being some crossover with these terms, and with one often being substituted for the other, there are a few key differences between 3PLs and freight brokers that savvy shippers should be aware of.
It's definitely worthwhile to take a closer look at the "3PL vs. freight broker" question to define the commonalities and differences between these two services and how to best decide between them.
What is a freight broker?
Freight brokers serve as the go-betweens in shipping arrangements between carriers and businesses that ship products. They work their magic to match cargo with the appropriate transportation method, speed and so forth. Freight broker duties can also include authorizing freight, coordinating cross-border shipping, tracking goods from manufacturer to market and negotiating pricing between shippers and carriers.
A good freight broker ensures that both parties' expectations are aligned on pricing, timing, routes, truck types and more. These liaisons ensure that the agendas and needs of the shipper and the carrier are satisfied.
Another service sometimes confused with a freight broker is a freight forwarder. While the former act as intermediaries between the shipper and carrier, freight forwarders often own their own containers that they use to prepare cargo shipments and generally take a more active role in shipment preparation than freight brokers do.
What is a 3PL?
A top-notch 3PL provides everything a freight broker does, and much more. Think of freight brokerage as a single spoke in the comprehensive service wheel of a 3PL. Just like a freight broker, a 3PL can negotiate rates and ensure that deals between shippers and carriers are fair and beneficial to all involved. 3PLs will have good relationships with a select group of vetted and reliable carriers that allow them to match the right carrier and cost to every shipment.
Besides these crucial carrier relationships, great 3PLs will offer a transportation management system (TMS) that can serve as the "brain" of a business's shipping operations. This smart software can schedule pickups, offer real-time shipment tracking, provide alerts, arrange insurance, offer cost and speed comparisons, integrate with e-commerce platforms and much more.
Another aspect of the comprehensive service the right 3PL can provide is completely customized support. Every business has unique needs and challenges, and a solid 3PL will get to know a business and its team to make unique recommendations, anticipate potential problems and offer customized solutions.
Which is right for your business shipping?
So now that you know the basics of 3PLs and freight brokers, how do you choose the best option for your business's shipping needs? We can answer that question with another question: why not have the best of both worlds?
By partnering with Worldwide Express, you can enjoy the benefits of a top-notch freight broker, wrapped into the all-encompassing service provided by an experienced 3PL. For more than 25 years, tens of thousands of SMBs have trusted us as their partner for all their small package and freight shipping needs.
This quarter-century of service has given us expertise and insights into the unique requirements of SMBs, enabling our dedicated service team to tailor support for each of our customers. Our proprietary SpeedShip® TMS is customizable, smart and routinely updated to meet the evolving needs of our customers.
Over the decades we've also assembled a carefully selected group of more than 65 less-than-truckload and tens of thousands of full truckload carriers. We're also the largest non-retail UPS® Authorized Reseller in the country. These carrier relationships allow us to offer our customers pricing and service that they would never be able to achieve on their own or through another broker.
By partnering with Worldwide Express, you'll enjoy the benefits of comprehensive 3PL guidance and strong freight broker support. Get a complimentary, custom shipping consultation from our experts today!