Redwood Blog

Technology-Driven 3PLs are Today's Asset-Based Carriers ... But Better

What is a technology-driven 3PL?

Technology-driven 3PLs like Redwood use special transportation management system (TMS) technology to efficiently manage carrier networks. Instead of focusing on a physical asset such as trucks, these 3PLs focus on “smart” technological assets like cloud-based software. For example, we built our own TMS, Loadrunner, from the ground up and use it as a tool to build better, cost-effective relationships with our shippers and carriers.

What makes a technology-driven 3PL as reliable as an asset-based carrier?

Technology-driven 3PL

Short answer? They aren’t. Technolgy-driven 3PLs are actually more reliable than a traditional carrier. Carriers have one fleet, and one fleet only. If a driver breaks down on the way to grab your load - good luck! You’ll be stuck on the phone frantically trying to find someone, anyone, to get your load where it needs to be on time. A 3PL faced with the same problem immediately knows who in their network can pick up the slack. Be it through available backhaul capacity, a regular outbound route through another carrier, or unexpected space in a private fleet - your load will be in the hands of a carrier and get to its location on time. Instead of putting all their eggs into one basket like an asset-based carrier, a 3PL “crowdsources” its carrier networks and uses a TMS to quickly and efficiently find an alternative driver.

Why would a technology-driven 3PL be more efficient than a traditional carrier?

This really boils down to how far technology has come in the shipping sector. Many years ago, a 3PL wouldn’t have been more efficient than an asset-based carrier! Today, with a TMS like LoadRunner, a 3PL can match a carrier to a shipper’s load and have them dispatched instantly. Because a carrier is so focused on their physical equipment assets, they have little to no resources left to dedicate to their technology. The results are much less efficient than those of a good technology-driven 3PL.

Let’s take a look at exactly how efficient and advanced the technology of a top tier 3PL has become. Here are the facts:

1. A 3PL using a TMS can access databases of both available and backhaul capacity.

2. This available and backhaul capacity is pulled from not only regional carriers, but private fleets and owner-operators within the carrier network as well.

3. A 3PL can contract many of its own private and dedicated asset fleets – just like a traditional carrier. The difference is that a 3PL can locate way more of these dedicated assets instead of just owning a handful.

4. If multiple carriers are found for a load, shippers are able to take advantage of lower pricing. This is especially common for backhaul carriers.

As if this weren’t enough, the best 3PLs out there build their TMS from scratch to offer even more solutions.

For example, here are some of Redwood’s advantages:

Redwood employees and Redwood customer/carrier partners submit feature requests through LoadRunner that go straight to the development team. That includes integration with old quoting systems, sophisticated invoicing, custom API integration, or anything else that we may need.

Real-time data is kept on all carriers including their safety records, years in business, the age of their equipment, insurance limits, and capacity availability. If you choose, you can have any carrier that does not match your safety standards removed from your options.

Asset-based brokers pioneered standards of reliability and efficiency for brokers everywhere. Today, technology-driven 3PLs carry on their legacy - creating better, more efficient systems for both shippers and carriers every day. To learn more about what powers Redwood you can read our blog posts on ways brokers can deliver an asset-based experience, choosing an asset vs non-asset 3PL, and why we built our own TMS in the first place, or just call us directly at (773) 342-5780 to speak with any number of our experts about custom-fit solutions for your business.