2020 Outlook for Third Party Logistics Companies

Posted & filed under Full Truckload.

The holiday decorations are long removed. Over-the-road fleet drivers are rested, independent contractors and owner-operator truckers have returned to the open road. We are now many weeks into 2020. The next few quarters are setting up in support of the strong offerings of third-party logistics (3PL) companies as primary transportation service providers.

 

Third-Party Logistics Companies Save Time and Money

The normal business cycle appears to be returning to its historical form. 3PL providers help shippers navigate the market because of their unique position. This includes sourcing both committed and transactional capacity at fair-market rates and providing transportation management activities that can save time and money.

Truckload capacity doesn’t fit neatly into a single uniform configuration. Although the mid-to-large fleets tend to dominate the industry headlines, it’s the smaller carriers of that provide the largest portion of real capacity. 3PL’s that are focused on reaching deeper into the carrier community to create strong relationships can bring the biggest long-term value to shippers.

Very soon, many asset-based truckload carriers will be requesting appointments with shippers. They want to share their 2020 perspective of rising cost structures, driver retention concerns, and inadequate return on investments. The carrier’s goal is to get a commitment from the shipper. This is a natural part of the cycle and occurs constantly between shippers and asset-based carriers. It is also an unnecessary use of valuable shipper time and resources.

 

3PLs Give You Visibility Into the Market

The third-party logistics partner, such as England Logistics, is your best possible advocate to benchmark available pricing. They can help you to get visibility to actual market capacity and hold carriers accountable relative to service. State-of-the-art technology such as real-time shipment tracking, vast capacity sourcing options and a wealth of pricing data across modes and geographies helps a 3PL create and sustain accountability with carriers in 2020. Many shippers want to have visibility into this information.

3PL’s provide a wealth of independent consultative insight on how key economic drivers can impact the broader logistics variables. A few examples of this are capacity supply, rates, fuel costing and regulatory concerns. Particularly during periods of macro-economic transition or uncertainty. This insight from a third-party logistics partner can be applied to budgeting, forecasting and supply-chain planning. With this information in hand, companies can build a sustainable and durable transportation program.

2020 will no doubt have unforeseen curves in the road ahead, however those curves become less impactful to shippers who have balanced their portfolio with a strong 3PL partner.