Archive for

The Benefits of Implementing Freight Logistics Software

More Control

Freight logistics software-also known as truckload logistics software-lets companies supreme control over the economy and timeliness of their shipping process by allowing them choose their own shipping options. When companies outsource to a third party logistics (3PL) provider, the provider develops shipping solutions that are in its best business interest, meaning that shipping companies can miss out on shipping options that would benefit them the most. Because logistics software is tailored to apply to a company’s unique shipping process and offers an easy to use interface, it does not require logistics expertise of its users. In addition, because logistics-software is offered on a SaaS model, it can easily be re-adapted to a company’s shipping needs as they change over time.

Lower Cost

Logistics-software costs less than 3PL for a simple reason: it is priced as a software solution and not as a logistics consultancy service. The cost of logistics software is based on a company’s shipping requirements, allowing companies to pay for only as many services as they need. For example, if a small company’s shipping needs consist only of less than truckload (LTL) shipping arrangements, the options offered through logistics-software will reflect these needs only. In addition to saving companies money on the logistics function, logistics software also allows companies to save on shipping solutions. Whereas some 3PL providers (e.g. non-asset based providers) charge shipping companies over and above the cost of a shipping solution in order to profit from a carrier discount, logistics-software insures that companies never pay hidden fees.

Integrated Shipping Solutions

When shipping companies outsource their logistics to asset-based logistics providers, they only realize shipping solutions that can be accommodated by the asset-based provider’s transportation assets (e.g. trucks, boats planes, etc.). But with logistics software, companies can realize shipping solutions that involve various modes of transportation to a certain location. For example, logistics-software may reveal that shipments to a certain location would be cheaper to transport by air for the majority of the trip due to warehouse fees that would result from ground shipping. Considering the cost of the shipping process, realizing integrated shipping solutions on a daily basis can dramatically impact a company’s bottom line.

Significantly Improved Bottom Line

Logistics-software can improve a company’s bottom line by presenting the most economical shipping options for a company’s shipping needs. But it can also save companies money by removing the need to hire in house logistics professionals when they grow large enough to purchase their own shipping fleet. Although logistics-software is often presented as an ideal solution for small to midsized companies that can’t hire their own logistics experts; it is also used by companies whose annual shipping costs exceed six figures, allowing them operate without the cost of logistics professionals. Research shows that companies can reduce their overall shipping costs by 10 percent after only one year of using logistics software.

Logistics Software is the Ideal Solution For Shipping Optimization

When a shipping company invests in logistics solutions, its main goal is to achieve shipping optimization, which focuses on expediting the shipping process while driving down its cost. But it’s important to realize that the cost of a logistics solution is also part of the cost of the shipping process. To achieve freight optimization, shipping companies have three choices: they can hire their own logistics experts; outsource their logistics needs to third party logistics (3PL) providers; or implement logistics software, which allows them to serve as their own logistics provider. For most companies, hiring their own logistics experts is the preferred solution, but not for the reasons that one might suspect. Compared to 3PL, which shippers regularly complain makes them feel distanced from their shipping process, an in house logistics department results in what every shipping company wants: total control over the shipping process. Yet, this is exactly what logistics software offers, and at a fraction of the price.

Traditionally, companies that can’t afford their own logistics department turn to 3PL. But the type of 3PL provider that offers the comprehensive, innovative approach offered by a logistics department can be as expensive as hiring a logistics expert, which means that small to midsized companies often turn to lower level 3PL providers (standard 3PL providers and service developers) that don’t offer comprehensive, innovative approaches to shipping optimization. Gradually, however, this trend is changing, especially as companies learn that you don’t need logistics expertise to operate logistics software. Developed by logistics experts, the software does the work of a logistics expert, presenting shippers with optimized solutions that they can choose from by using a user-friendly interface.

Using logistics software is essentially like having your own logistics department, but without the salary and other headaches that come with personnel. As a result, even companies that grow large enough to afford their own logistics team are instead opting for logistics software. In terms of shipping optimization, the software offers the same route planning and optimization and load optimization solutions that a logistics department would. Concerning route planning and optimization, the software offers the following benefits, among others: reduction of distribution costs and miles, decrease in routing time and contingency planning. Concerning load optimization, the software allows shippers to complete accurate and quick load design for different route types, employ multiple loading strategies, pre-build orders and select load designs that reduce product breakage.

Whether your company needs logistics solutions in the first place or its partnership with a 3PL provider isn’t offering the desired level of freight optimization, implementing logistics software can dramatically improve the quality and decrease the price of its shipping process. Research shows that shippers who implement logistics software can reduce their shipping costs by 10 percent after only one year.