What to look for when choosing a 3rd Party Logistics (3PL) Company
Outsourcing your company’s transportation needs to a 3PL freight company is an important decision you should not take lightly. In professional sports, teams spend a considerable amount of time and resources in choosing the winning pieces to make their team a success. Businesses should take a page from sports teams and apply the same amount of time and resources to research who will best save them money by negotiating the best rates possible to ship their freight. Finding the right 3PL company to handle your freight can be crucial to the success and growth of your company.
Don’t just let anyone handle your freight
Choosing the wrong 3PL can have nightmarish consequences. For instance, if the 3PL is just starting out or does not maintain proper accounting and cash flow to pay their bills, it may end up using the payment you paid for your freight to cover other operating expenses rather than to pay the carrier shipping your cargo. In this scenario, the carrier will seek out payment from the original customer (you) or hold their freight for ransom, forcing the customer to pay for their shipment, AGAIN! It sounds like a horror story, but we’ve seen it happen.
What are the most important factors in choosing the right 3PL?
Ask For Certifications
Ask for proof that they are registered as a freight forwarder under U.S. federal law or have a Motor Carrier operating authority number, and, that they are up to date. Not being able to provide any of those 2 proofs is an immediate red flag. More often than not, refusing to offer proof indicates that they are not registered as bonded carriers and you should run in the opposite direction to continue your search for another 3PL.
Just as you would get references before hiring a staff member, a babysitter or a dog walker – get references when you’re hiring someone to take care of your freight. If you don’t know someone that can provide a reference to you personally, look online or request a credible business reference from the 3PL providers. This extra step requires lead-time in your planning, but is well worth the money you’ll save partnering with a reliable 3PL. And remember – if it takes a business too long to track down a willing reference for you, that’s a clear sign it’s time to look for another 3PL.
Once you’ve found success partnering with the right 3PL company, take names. Build relationships with trusted contact persons in the company, and make time to serve as a reference for them in the future. These relationships can be valuable when you’re in a logistical jam, or looking to extend your own business network.
We never want our customers to have a negative experience when they are trying to move loads. Their business and livelihood depends on timely, professional delivery. At Freight-Specialist we are a fully bonded carrier and have the paperwork to prove it. We have been in business for over 40 years and have thousands upon thousands of satisfied clients to speak on our behalf.