Preview Mode Links will not work in preview mode

The Logistics of Logistics Podcast

Sep 30, 2020

3PL Basics: The 11 Transportation Services with Jeremy Thone

Joe Lynch and Jeremy Thone discuss the 3PL basics: the 11 transportation services provided by 3rd party logistics providers.

About Jeremy Thone

Jeremy Thone is the Marketing Director at 3PL Systems, which is a transportation management system software company based in Signal Hill, California. Jeremy grew up in the 3PL business because his father is the co-founder of Diversified Transportation based in Torrance, CA. Jeremy worked in 3PL sales with Diversified and then left joined a number of high-tech start-ups prior to joining 3PL Systems. Jeremy earned a Bachelor of Science, Marketing from the University of Southern California.

About 3PL Systems

3PL Systems, Inc. provides transportation management system software to help make freight brokers more profitable - both by helping them bring in more revenue and helping them to operate more efficiently. 3PL Systems'​ BrokerWare is used to manage all shipping and transportation activities from one place, including dispatch, operations, routing, carrier selection, tracing, accounting, billing, collections, and much more. BrokerWare is a transportation management system (TMS) for Non-Asset Based Freight Brokers. Our freight broker software package has built-in support for many types of shipments including less-than-truckload (LTL), truckload (TL), expedited, rail, and any type of specialized equipment.

Key Takeaways – 3PL Basics: The 11 Transportation Services 

Transportation Service #1 – Small Package

Package delivery or parcel delivery is the shipping of packages (parcels) or high-value mail as single shipments. While the service is provided by most postal systems, private package delivery services have also existed in competition with and in place of public postal services.

Package delivery or parcel delivery is the shipping of packages (parcels) or high-value mail as single shipments. While the service is provided by most postal systems, private package delivery services have also existed in competition with and in place of public postal services.

Transportation Service #2 – Air Cargo

Air transportation is used to transport air cargo by plane. Air cargo or air transport is a vital component of many international logistics networks.  Air transport is a vital part of international commerce.  Air transport involves the integration of information, transportation, inventory, warehousing, material handling, and packaging.  Transporting goods to and from the airport is also an essential part of the process.

Transportation Service #3 – Ocean

Ocean transport is used to move goods across the ocean or larger lakes.  There are many different types of cargo that are moved in various types of ships.  The ship types include bulk carriers, container ships, tankers, refrigerated ships, and roll-on / roll-off ships.

Bulk carriers are cargo ships used to move bulk cargo like coal, ore, grains, and liquids.  Bulk cargo is commodity cargo that is transported unpackaged in large quantities. It refers to material in either liquid or granular, particulate form, as a mass of relatively small solids, such as petroleum, grain, coal, or gravel. This cargo is usually dropped or poured, with a spout or shovel bucket, into a bulk carrier ship's hold, railroad car, or tanker truck/trailer/semi-trailer body.

Container ships are cargo ships that carry their entire load in truck-size containers, in a technique called containerization. They form a common means of commercial intermodal freight transport. Informally known as "box boats," they carry the majority of the world's dry cargo.

Tankers are cargo ships for the transport of fluids, such as crude oil, petroleum products, liquefied petroleum gas, liquefied natural gas and chemicals, also vegetable oils, wine, and other food.

Refrigerated ships (reefers) are cargo ships used to transport temperature-controlled transportation, mostly fruits, meat, fish, vegetables, dairy products, and other foodstuffs.

Roll-on/roll-off ships are cargo ships designed to carry wheeled cargo such as automobiles, trailers, or railway carriages. RORO (or ro/ro) vessels have built-in ramps which allow the cargo to be efficiently "rolled on" and "rolled off" the vessel when in port.

A Multi-purpose ship (sometimes called a general cargo ship) is used to transport a variety of goods from bulk commodities to breakbulk and heavy cargoes. To provide maximum trading flexibility they are usually geared and modern examples are fitted for the carriage of containers and grains.

Breakbulk cargo or general cargo is a term that covers a great variety of goods that must be loaded individually, and not in intermodal containers nor in bulk as with oil or grain. Breakbulk cargo is transported in bags, boxes, crates, drums, or barrels. Unit loads of items secured to a pallet or skid are also used.

Transportation Service #4 – Less Than Truckload

Less Than Truckload (LTL) is a shipment that does not require a full 48 or 53-foot trailer. There are many carriers that specialize or offer this service and like full truckload carriers, the LTL carriers themselves specialize in different services such as lift gate and residential pick-ups and deliveries, guaranteed services, temperature control, transit, and bottom-line cost to name a few.

Within a local area, the LTL freight operator has a number of vehicles that collect shipments from their customers. After finishing the daily collection, the shipments are taken to a terminal where the vehicles are unloaded. Each shipment is weighed and rated which allows customer bills to be processed. The individual shipment is loaded onto an outbound vehicle which contains shipments from other customers bound for the same geographic area. The outbound shipments are trucked to appropriate regional terminals, where they are unloaded. The shipments are sorted and placed on local vehicles for delivery. Each individual shipment is handled a number of times from the time it is picked up from the customer until it reaches its final delivery location.

Transportation Service #5 – Truckload

Truckload shipping is the movement of large amounts of similar freight, usually the amount necessary to fill an entire semi-trailer or intermodal container. A truckload carrier is a trucking company that generally contracts an entire trailer-load to a single customer.

Full truckload carriers normally pick up and deliver dedicated shipments.  Typically, shipments are picked up at the shipper and delivered directly to the consignee.  Truckload shipments are generally handled less, cost less per unit shipped, and have less freight damage.

Transportation Service #6 – Dedicated Contract Carriage

Dedicated contract carriage is a third-party service that provides dedicated equipment (vehicles) and drivers to a single customer for its exclusive use on a contractual basis.

DCC is a flexible service that offers all the service advantages of a private fleet and the convenience of a for-hire carrier. DCC in a sense outsources many of the challenging functions associated with managing a fleet.  Functions including, but not limited to ongoing operations management, technology, drivers, vehicles, vehicle maintenance, safety, regulatory compliance, risk management, and pickup and delivery instructions.

Transportation Service #7 – Intermodal

Intermodal refers to transportation by more than one means of transport such as a ship, truck, and rail.   The intermodal containerization of cargo has revolutionized the supply chain logistics industry.  The reduced handling results in increased efficiency, which has lowered shipping costs substantially.

Transportation Service #8 – Final Mile

Final mile (last mile) describes the movement of goods from a transport hub to a final destination.  Transporting goods via freight rail networks and container ships is often the most efficient and cost-effective manner of shipping. However, when goods arrive at a high-capacity freight station or port, they must then be transported to their final destination. The last mile problem can also include the challenge of making deliveries in urban areas where retail stores, restaurants, and other merchants in a central business district often contribute to congestion and safety problems.

Transportation Service #9 – Rail

Rail transport utilizes freight trains to haul cargo.  Oftentimes, the freight cars are customized for a specific type of freight.  Freight trains are very efficient, with economies of scale and good energy efficiency.  However, pick-up and delivery to the railhead are costly and inconvenient.

Container trains have become the dominant type in the US for non-bulk haulage. Containers can easily be moved to other modes of transportation like ships and trucks.

Rail is the most efficient mode for transporting bulk shipments like coal, ore, grains, and liquids. Bulk is transported in open-topped cars, hopper cars, and tank cars.

Transportation Service #10 – Fleet Acquisition

Fleet acquisition services help companies acquire trucks.  Fleet acquisition companies conduct an analysis of the client’s needs so they can acquire the right truck(s) for their clients.

To specify the truck fleet, the following information is considered: customization, driver requirements, market information, maintenance costs, financing options, taxes, etc.  Other functions include project management, inspection, and delivery.

Generally, fleet acquisition services will help their clients save money through market intelligence, volume pricing, and close relationships with the OEMs.

Transportation Service #11 – Equipment / Drivers

There are logistics companies that sell or lease transportation equipment to their clients.  Transportation equipment is used to move material from one location to another, like between a loading dock and a storage area, etc...) within a facility or at a site.  Typical equipment includes conveyors, cranes, industrial trucks.

There are also logistics companies that provide temporary and/or fully-outsourced driver leasing services.  These companies manage the driver workforce, enabling their clients to focus on their business.  Driver leasing companies specialize in hiring, training, driver management, employee retention, and benefits management.

Learn More About 3PL Basics: The 11 Transportation Services 

Jeremy Thone

3PL Systems

The Logistics of Logistics Podcast