Understanding the Difference Between Freight Carriers, Companies & 3PL Providers
When you need to ship commercial goods, you will likely realize shipping is complicated. It’s not an easy business, especially if you have a tight schedule you need to stick to.
There are a few common types of companies ready to help you navigate the shipping world. Freight Carriers, Freight Companies, and 3PL Providers are the most common options. Let’s look at the differences between these three entities.
For most businesses, working directly with a freight carrier isn’t the right option. A freight carrier will be the actual person or company moving your goods, such as the company the truck driver works for.
These companies will physically move your goods, but they don’t manage your shipment or handle anything else. They are not freight forwarders or 3PL providers, but they work with both as an integral part of the shipping process.
Freight Forwarding Companies
A freight forwarding company will connect you with the right freight carrier to ensure your shipment gets moved from Point A to Point B properly. They will arrange the shipping, even if it includes more than one type of freight carrier.
For example, if you’re shipping goods from Jacksonville, FL to Edinburg, Scotland, you may need a freight forwarder to arrange the airlift, marine shipment, and rail transportation to get the goods from Jacksonville to Edinburgh.
You may need multiple options because the goods may have to arrive in England before making it to Edinburgh, Scotland. It’s a tricky process, but a freight forwarding company will arrange the right transportation options for your shipping needs.
While a freight forwarding company will make all the necessary arrangements, they won’t actually move your goods. They connect the shipper to the freight carrier, and the freight carrier will actually move your goods from Point A to Point B.
While freight forwarding companies and 3PL Provides are a bit similar, they are not the same. 3PL or Third-Party Providers offer more services than a freight forwarder. They are the full-service shipping option.
A freight forwarding company will act as the middle man between the carrier and the shipper, while a 3PL provider will act as the packer, biller, carrier, and keeper of warehouse goods. They are more of an all-in-one solution.
When you hire a freight forwarding company, you still have to handle the logistics and other parts of your supply chain. Your freight forwarder will simply match you with the right freight carriers and make arrangements for you.
A 3PL provider takes things even further. When you hire a 3PL service, you will be during over some or all of your logistics and supply chain operations to a third-party company. They will take care of everything, which leaves you free to grow your business.
A few of the main tasks a 3PL provider will handle include:
- Cross Docking
- Inventory Management
- Order Management
- Retail Scan Packaging
- Freight Distribution
When you choose a 3PL service, you gain access to a solution capable of handling your entire supply chain. Unless you already have in-house resources to handle the services of a 3PL provider, it makes sense to outsource a large amount, if not all, of your logistics and supply chain operations.