Partnering with Asset-Based Providers in 2022
There are two primary kinds of third-party logistics providers that help keep goods flowing; asset-based and non-asset-based.
The latter is also known as brokerage firms and they generally own little or no physical resources that are required to fulfill clients’ needs. Instead, they coordinate with several outside companies to complete their task. While this does save you from the headache of directly dealing with carriers, the trade-off is that brokerage firms tend to fluctuate prices more due to holding so many partners from who they must outsource tools or labor. The costs to use those tools or outsource that extra labor are not always set in stone. In fact, most do fluctuate a bit over time. When this happens, the non-asset-based provider passes these costs onto their clients in some form.
On the flipside, asset-based providers own most, if not all, of the services and tools they use. While limited coverage is a factor to consider when looking at 3PL’s post-pandemic, asset-based carriers have become a go-to, especially for regionally-focused supply chains.
Aside from that, the benefits of working with a company that directly controls every step of your supply chain, including tasks such as competitive pricing, secure shipping arrangements, and a more innovative approach all-around is what makes asset-based providers something to seriously consider for 2022.
Fewer Spoons In The Pot
One of the most attractive aspects of using an asset-based carrier is the opportunity to lock in considerably lower rates.
This is due in large part to the providers’ ability to more accurately calculate prices. They are able to do this because they have access to routine transport. Furthermore, since they already own the equipment, they don’t have to charge higher fees to offset rental costs. Additionally, it ensures that your packages will switch hands as few times as possible on their journey to the consumer. This results in fewer opportunities for shipping damages which could potentially cause more returns.
An added bonus of working with asset-based providers, it helps foster an ever-growing number of opportunities for new truck drivers looking to begin a well-paying career without having to drive cross-country. Regional asset-based carrier services are making an astounding resurgence moving into 2022.
With the recent backups at most storage centers and the sizeable drop in driver retention, it has become harder for 3PL’s to guarantee specific timeframes. This is especially true during peak seasons.
However, when every stage of the process is handled by just one provider it is far more consistent and predictable. This makes it exponentially easier to calculate and deliver on an extremely precise schedule. Overall, it provides the security of knowing that your goods move as quickly as possible. Having that kind of confidence in the delivery itinerary that you give your customers is priceless.
Have An Asset-Based 2022
So why should you consider an asset-based provider to handle your packages in 2022? It’s simple, the costs are competitive with non-asset-based 3PL’s. Additionally, there are fewer variables in transportation, and it can even prove to be a bit more eco-friendly.