Vendor Compliance and Truckload Shipping: How Logistics Software Can Help

Is the cost of meeting the vendor compliance standards of large retailers and corporations worth the resulting sales? Perhaps not in the short-term, but in the long-term, complying with complex vendor standards is one of the few ways to turn mediocre product sales into phenomenal sales. Even so, small to midsized manufacturers that aim to meet the standards of large corporations and retailers cam immediately find what seem like insurmountable obstacles in their path, especially concerning standards that regard the shipping process, such as the requirement that companies ship full truckloads-as opposed to less than full truckloads-to a business’s receiving docks.

Vendor Compliance and Truckload Shipping: Can Shipping Logistics Help?

The problem with full truckload shipping-also known as TL shipping-for small to midsized vendors isn’t that they can’t ship less than a full truckload of their products in a full semi trailer; it’s that doing so is cost prohibitive. As a result, small to midsized companies typically turn to less than truckload shipping-also known LTL shipping-in which two or more shippers of partial loads combine their shipments to form a full truckload and split the cost. The general advantage of LTL shipping is its cost effectiveness, while its general disadvantage is its slower delivery time, resulting from numerous pick ups and drop offs.

But LTL can have a more specific drawback concerning vendor compliance and truckload shipping: it could throw a wrench in a business’s well-oiled receiving system, where a full truckload of products comes from a single source and is therefore brings less risk of error during the receiving process. Traditionally, only companies that produce enough goods to fill a full truckload on a regular basis use TL shipping. But today, transportation logistics allows shippers the option of shipping full loads on a schedule more suited to their production output, allowing participation with large buyers of goods.

Method of shipping is one of numerous concerns within a complex set of vendor compliance standards. But it remains one of the toughest standards to meet if you don’t have shipping logistics on your side, a service that companies can secure in one of three ways: by implementing their own logistic department; by contracting with third party logistics (3PL) providers; and by implementing logistics software, which allows you to become your own logistics provider without possessing logistical expertise. Out of the three options, the latter is the least expensive, while still supplying the broad, in-depth approach to logistics a company would receive if it had its own logistic department. To find out more about how logistics software can help your company meet the compliance standards of large corporations and retailers, contact an online provider of logistics software today.

Supply Chain and Logistics Management

Supply chain management is the supervision of a set of connections of organized businesses drawn in the definitive condition of manufactured goods and service parcels required by ending clientele. Supply Management spans all progress and storage space of raw materials, work-in-process stock, and completed merchandise from point of origin to point of utilization. Supply chainmgnt software includes tools or modules used to carry out dealings, administer supplier associations and be in charge of linked commerce processes.

Six most important activities can be observed in the progression of supply chain management study: Creation, Integration, Globalization Specialization Phases One and Two, and SCM 2.0.Supply chain business course of action involves shared work involving buyers and suppliers, joint product development, common systems and shared information. Common SCM problems involve distribution strategy, distribution of network configuration, trade-offs in logistical activities, information, inventory management and cash-flow.

Successful SCM entails a alteration from managing individual functions to integrating actions into key supply chain processes. An example scenario: the purchasing department places orders as requirements are known. The marketing department, responding to customer requirements, converses with a number of distributors and retailers as it tries to establish ways to satisfy this requirement.

Logistics management activities usually consist of inbound and outbound transportation management, fleet management, warehousing, materials handling, order fulfillment, logistics network design, inventory management, supply/demand planning, and management of third party logistics services providers.

If the Supply chain management is global in nature many more challenges in addition to existing problems comes into picture as the lead time is much longer. Actions in supply chain management can as well be classified into various levels like strategic, tactical and operation.

Freight Logistics Software Vs Third Party Logistics: Which Is Better?

Today, two types of freight solutions appeal to shippers that rely on carriers: logistics software (a.k.a. TMS software) and third party logistics (3PL). Logistics software allows shippers to become their own logistics provider by using a software program, while 3PL providers negotiate arrangements between shippers and carriers. Frequently compared and contrasted, logistics software and 3PL each offer unique benefits. However, the former has the following important advantages:

Less Expensive

Standard 3PL providers and service developers, which offer particular services and not comprehensive solutions, are usually quite affordable. When you hire a provider that offers innovative management of the shipping process – namely, a customer developer – the cost can compare to hiring an in-house logistics department. Logistics software provides logistics through a software as a service (SaaS) platform. It can also be implemented as an in house solution. Instead of relying on a costly customer developer, you can save money and realize more control by using a software solution.

More Control

A top complaint of 3PL customers is they feel distanced from their shipping process and the entity that manages it. Different 3PL providers have different approaches, but few of them integrate the shipper in the shipping process in a formal capacity. For some shippers, having the shipping process fully managed by another entity is appealing. Due to its expense and vendor issues it involves, most shippers wish to be involved in the process. Freight logistics software does more than “involve” shippers in their own shipping process; it puts them in control of it.

Better Options

3PL providers make freight arrangements by listing an available load in an electronic posting system, where it can be matched with an available carrier, or by negotiating with carriers that don’t use a posting system. Because the former method is usually the easiest, many 3PL providers use it to arrange the largest percentage of shipments – a scenario that limits shippers to carriers who use a posting system. Logistics software removes this barrier and exposes you to more carrier options. In some instances, a shipper misses the best carrier option because the carrier who could provide it will not work with the shipper’s 3PL.

Greater Security

No shipping process is as secure as one that the shipper handles on its own. When outsourcing to a 3PL, shippers naturally lose the capacity to scrutinize the carriers with which their loads are placed. Although 3PL providers select carriers with the customer in mind, they also select them with themselves in mind – a dichotomy that can jeopardize the interests of shippers. Freight logistics software alleviates security concerns by putting you in control of the shipping process.

Conclusion

Logistics software is a viable replacement for 3PL, particularly for shippers who wish to control their own shipping process. Next to payroll, shipping is the second largest operating expense for most shippers. This means that rejuvenating a stale shipping process with better carrier options can have a significant impact on a company’s bottom line – an impact that logistics software allows you to achieve.