A Transportation Management Audit Can Help With That!
So, you are considering hiring a third-party logistics company, but not sure where to start?
If we are being honest, this is the situation that most shippers seem to face on a daily basis. They realize that they could use some assistance with their logistics operations, but they just don’t know how or where to begin.
The best way to begin the process is by performing something called a transportation management audit.
A transportation management audit is a process designed for reviewing carriers within your network. Furthermore, it analyzes the procedures you follow for rating, selecting, and retaining them.
This type of audit can be done in-house, but most shippers prefer to hire a 3PL service to help them complete it efficiently.
But, before we dive too deep, let’s explain a few of the common reason’s companies reach out to a 3PL in the first place.
Why Should Shippers Hire 3PL Services for a Transportation Management Audit?
The supply chain is a complicated beast, and it can be a hard one to tame.
To offer your customers the best experience you must provide accurate scheduling, timely deliveries, and overall stellar experience. However, to do that properly, it takes a full-scale logistics operation.
For some shippers, it’s not worth the stress, financial investment or frustration to attempt to build their own in-house shipping and receiving network.
This is the primary reason why many shippers, instead, choose to work with an experienced third-party logistics company. Additionally, 3PL companies offer a slew of various beneficial services. Everything from complete enterprise solutions to individual or ala carte logistics-based services.
A few of the more popular 3PL services that most shippers benefit from include:
- Carrier Negotiations: Every type of carrier, from parcel to LTL negotiates shipping rates on an individual customer basis. It’s well understood that 3PL’s maintain solid relationships with carriers in all modes of transportation. Furthermore, they can negotiate shipping rates and carrier contracts that financially benefit their clients.
- Fuel Surcharge Management: Another negotiated contract with carriers is the dreaded fuel surcharge. This is another area where 3PL relationships with carriers benefit their clients – financially.
- Accessorial Management: A 3PL also help their clients avoid common accessorial charges and negotiate additional white glove services.
- Off-Site Hosting & Warehousing: As a company expands, their need to receive and ship goods increases. A 3PL can be retained to help with off-site hosting and warehousing functions, from simple storage services to inventory control, drop-shipping, even light manufacturing.
- Import and Export Operations: International shipping can be time-consuming and expensive for most in-house shipping departments. 3PLs have increasingly become experts in the international logistics industry and can manage a shipper’s complete international operation.
What Does the Transportation Management Audit Accomplish?
During a transportation management audit, a 3PL or other logistics specialist will review several aspects of your current logistics network. With plenty of data in hand from the initial review, they are able to find ways to improve the movement of your freight.
Specifically, the audit will cover a couple of key areas:
- Examine your current shipping and logistics agreements: By understanding what you’re currently paying, the terms, and which carriers you are working with, a 3PL can help you to optimize certain areas of your shipping process.
- Review your business and shipping needs: The audit also examines your industry, current service offerings and determine your current supply chain needs. However, the best audits also look towards the future; to plan the expansion of your supply chain operations.
While there are many other areas that a full-scale audit looks at, these are the two most important.
Ultimately, the goal of a transportation management audit is to determine a companies shipping pain points. More importantly, it shows you what type of carriers, rates, and options you need to consider in order to correct those pain points.
Thanks to our recent acquisition of Eminent Global Logistics, our service offerings have expanded. Now, we also offer premium logistics consulting and outsourcing services as well as completing robust transportation management audits.
If you’d like to learn more about new service offerings offered by Redwood Logistics, contact us today.