Less-than-truckload carriers haven’t always been keen customers of freight brokers, but many operators are turning to third-party logistics in a search for new business.
At June’s SMC3 Summer Conference in West Palm Beach, Fla., logistics consultant Evan Armstrong asked trucking executives how many of them weren’t working with a 3PL, and not one raised a hand.
That’s because shippers are working with 3PLs — and lots of them.
Among the Fortune 100 companies, 93 percent use at least one 3PL, Armstrong said. Some of the largest companies use several. General Motors has 49 3PLs; Procter & Gamble, 42; and Wal-Mart, 39, according to Armstrong & Associates research. “For companies with multiple supply chains, it’s very hard to single-source,” he said.
That means trucking companies working with 3PLs can gain multiple points of access to major shipper supply chains and available freight.
When Con-way Freight expanded its business with Caterpillar Logistics last month, the carrier gained greater access to freight from $32.4 billion Caterpillar and more than 65 other companies that contract Cat Logistics to manage their supply chains.
The trucking company is the exclusive LTL provider to Cat Logistics for freight originating in 27 states, and will haul freight for Cat Logistics in Mexico and Canada. Con-way began working with Cat last year, covering 11 states and Mexico.
Increasingly, the need for sophisticated technology is the glue binding LTL carriers and brokers, said Donald Maltby, executive vice president of logistics services at Unyson Logistics, a subsidiary of intermodal company Hub Group.
“It’s not just the technology to handle everyday transactions,” he said, “but the technology to provide visibility across all modes of transportation in a supply chain.”
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