Choosing the right managed transportation provider may seem like an insurmountable task. It's understandable when so many managed transportation companies are competing for attention, making the process overwhelming for decision-makers tasked with the selection.
It is possible to find a managed transportation service capable of meeting all of your needs, but it means understanding which managed transportation provider type is ideal for your mid-market company.
Freight shipping is an industry broad in scope and variability. Shippers need a wide variety of services, vehicles, lanes, and modes, depending on their particular product, retailer, and region. Mid-market companies also benefit most from managed transportation providers that offer a mix of adaptability and reliability.
To meet this variable demand from shippers, several different managed transportation provider types have evolved within the field.
Some carriers also act as managed transportation solutions providers. These asset-based carriers combine two services in one, which can be convenient for shippers who don't want to deal with tendering shipments or contracting with multiple carriers.
However, the asset-based managed transportation provider may be limited in flexibility. Shippers are encouraged to work within the asset-based carrier's network, which can limit their access to certain lanes, restrict the types of loads they can handle, and make it harder to meet surge capacity.
Asset-based carriers offering managed transportation are a good fit for companies with consistent volume that need dedicated capacity and regular shipments along the same lanes.
When it comes to connections to large carrier networks and swift load coverage, not many managed transportation solutions beat tech-enabled brokers and digital platforms. These digital service providers utilize technology and a data-driven approach to connect shippers with carriers quickly.
Tech-enabled brokers don't usually provide planning and optimization services, which may be a problem for shippers looking to increase efficiency. However, they can provide much-needed support with surge capacity and exceptions through spot freight transactions.
Many shippers work with traditional 3PLs offering managed transportation as one of their service lines. This established model has worked for decades, with traditional 3PLs often covering multiple needs like warehousing, distribution, and transportation.
One of the biggest benefits of 3PLs is their reliability and quick execution. 3PLs have established relationships with large carriers and available warehousing space, and they can also adapt to irregular demand quickly.
Companies that need a complete package of transportation + logistics services often rely on traditional 3PLs. It can be difficult to get an in-depth understanding of what's happening in the network, as 3PLs may or may not implement modern data analysis technology. 3PLs also focus more on the execution of freight rather than optimizing networks.
As a contrast to the digital broker, the pure-play managed transportation provider offers network optimization services and ongoing support. Pure-play managed transportation specialists oversee entire networks for shippers. They plan the approach, help source carriers, and take care of end-to-end planning of shipments.
These providers are dedicated partners who help shippers improve overall performance. Onboarding with a pure-play managed transportation service typically requires more upfront work, but a structured 90-day deployment can deliver visible results quickly.
Modern managed transportation providers built on full-stack AI-native technology are now emerging in the market. These autonomy-focused managed transportation services have developed their own tech stack of software built around artificial intelligence. When paired with transportation experts skilled in tech, this software allows autonomous managed transportation services to focus strongly on network optimization and data-driven insights.
These managed transportation providers utilize AI, autonomy, analytics, and managed services to reduce inefficiencies, increase cost savings, and automate workflows. Shippers who work with autonomous managed transportation services will need to provide a few months of freight data for analysis. It can also take time to fully implement optimizations across a transportation network.
Though there is a wide variety of managed transportation providers in the industry, only a few are ideally suited for the mid-market shipper. Growing companies with lean internal teams may struggle when faced with managed transportation services that need high-volume capacity or a commitment of time and cost investment.
As a result, mid-market shippers tend to be less inclined toward asset-based managed transportation in favor of more tech-enabled options. Mid-market shippers need flexible and strategic managed transportation solutions. This means fewer mid-market shippers are choosing asset-based carriers or traditional 3PLs, and more are turning to pure-play and AI-native autonomous managed transportation services that combine flexibility with optimization.
Mid-market shippers who are ready to choose a managed transportation partner need a team capable of matching their complexity and diverse shipping needs. Due diligence into the capabilities of the managed transportation provider is a good place to start. The managed transportation provider should offer services within your desired lanes, offer a mix of modes, and be able to handle volume variability.
A desirable managed transportation partner should also be able to help with scaling and optimization for your growing company. Modern managed transportation providers using AI-based TMS can help mid-market shippers get a ground-level view of their transportation network. They can provide quick execution, offer real-time tracking, and create detailed and insightful reports for the boardroom.
The right managed transportation provider has a strong team of industry experts behind the technology, too. These hybrid managed transportation providers can provide human oversight to deal with day-to-day challenges and exceptions so that order fulfillment continues in a timely fashion. With their support, a business should be able to meet retail demand quickly in a volatile and ever-changing environment.
It's hard to start the managed transportation provider comparison process. But knowing the answers to these frequently asked questions can help you get started.
An asset-based managed transportation provider has its own carrier fleet to provide freight services for shippers, while a non-asset managed transportation provider arranges contracts with carriers to complete shipments.
The choice between a technology-based managed transportation provider and a provider with a strong carrier network depends on your needs. If you are an established company in need of stability, a managed transportation provider focused on their carrier network can provide consistent and fast fulfillment. Those who want to optimize or maintain efficiency as they scale may prefer a technology-focused managed transportation specialist.
Assessing a managed transportation provider's fit during an RFP means evaluating their company in a strategic manner. Look at the managed transportation provider's operations and fit with your needs, determine if they offer the level of technological support you want, and check their estimated timelines and pricing to see if it works for your business.
A "full-stack" autonomy managed transportation provider minimizes manual transportation operations by combining AI, automation, and TMS software in their services.
If you are looking for a managed transportation provider offering flexibility, scalability, and a high level of autonomy, consider Loadsmart. Our team leverages technology and expert-level knowledge to streamline and optimize transportation networks for shippers. We provide the analysis and implementation needed to align the freight strategy with business goals.