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Managed Transportation: Frequently Asked Questions
Managed transportation (MT) has become popular among shippers that want to reduce freight costs and scale operations without expanding their teams. Still, decision makers might need additional information to evaluate if MT is right for their business.
To help, we’ve answered some of the most common managed transportation questions below, covering how MT works, what technology and pricing looks like, and how to compare providers.
General Managed Transportation Questions
What Is Managed Transportation?
Managed transportation is a service model where a third-party provider oversees planning, execution, optimization, carrier management, and other transportation processes on behalf of a shipper. The goal is to reduce freight costs and improve the efficiency of logistics.
How Is Managed Transportation Different From a 3PL or Freight Broker?
Unlike basic 3PL relationships and freight brokers, managed transportation focuses on operational management and strategic optimization across the network. MT combines technology, analytics, and logistics expertise to improve performance continuously instead of simply booking loads.
Is Managed Transportation Right for Me?
Managed transportation is ideal for businesses facing rising freight costs, complex or decentralized operations, growing shipment volumes, manual workflows, limited internal expertise, or stalled technology projects. Organizations experiencing any or several of these challenges can benefit from a managed transportation provider.
Managed Transportation Service and Technology Questions
What Technology Is Included in Managed Transportation?
Most MT providers include transportation management solutions, reporting dashboards, and carrier-related tools. Managed transportation can also include the use of automation software, AI-driven analytics and optimization, freight audit tools, and solutions related to the real-time visibility of shipments.
Do I Keep My TMS?
It depends on the provider and your situation. Some providers integrate their MT service with your existing TMS platform. Others can provide a full TMS as part of the service. In some cases, MT runs alongside your current system during transition and can eventually replace it if the provider’s platform is a better fit.
What Is FreightIntel?
FreightIntel AI is Loadsmart’s AI-powered analytics engine. It takes your logistics data and identifies inefficiencies in your operations and makes advanced recommendations.
Managed Transportation Implementation and Transition Questions
How Long Does Managed Transportation Implementation Take?
Implementation timelines vary by network complexity and carrier cooperation, but managed transportation engagement can launch in under 90 days. That includes assessment, carrier sourcing, system integration, and go-live.
What Data Is Needed to Implement Managed Transportation?
Historical shipping data, carrier contracts, current transportation flows, and network information regarding lanes and facilities are needed to implement managed transportation. In addition to that, shippers need to help MT providers integrate with TMS, ERP, or WMS systems.
Will There Be Disruptions?
This is one of the common managed transportation questions, as many shippers fear disruptions and potential costs. If the MT implementation process is managed well, the chance of disruptions is minimized. That’s why MT providers use phased rollouts and prioritize continuity during the transition process.
Managed Transportation Carrier and Performance Questions
Who Manages Carriers?
The managed transportation provider is responsible for handling carrier communication, tendering, performance monitoring, and compliance. Ultimately, shippers can choose which processes to retain and which to delegate.
What Guarantees Exist in Managed Transportation?
Reliable MT providers offer service-level agreements (SLAs) tied to important KPIs. These could be cost-saving metrics, on-time performance, or visibility-related KPIs. Credit clauses that hold providers accountable for performance also protect shippers’ interests.
Managed Transportation Pricing and Contract Questions
How Is Managed Transportation Priced?
There are several managed transportation pricing structures. Per-shipment fees, fixed subscription pricing, and the percentage-of-spend model are among the most common ones. Pricing typically scales with the number of shipments managed, the modes covered, and the scope of services included.
Does Managed Transportation Have Hidden Fees?
Reputable MT providers like Loadsmart outline all costs upfront. That includes implementation costs, service inclusions, and different pricing tiers. During evaluation, ask for a complete fee schedule and confirm what’s included versus what’s billed separately.
What Is the Contract Length of Managed Transportation Services?
Contract terms vary significantly and are often part of the overall negotiation process. Typically, MT agreements range from one to three years.
Industry-Specific Questions About Managed Transportation
Do Companies Get Industry-Specific Support With Managed Transportation Service?
Some MT providers specialize in a specific industry. Others can support industry-specific requirements, such as food and beverage compliance or retail routing guides.
Is Managed Transportation Suitable for Hazmat Shipments?
Some managed transportation providers support hazmat operations through specialized carrier networks and compliance workflows. Capabilities vary by provider, so regulatory expertise should be validated during the MT evaluation process.
Is Managed Transportation Suitable for International Companies?
Managed transportation can support both domestic and international freight shipments. In this case, managed transportation helps with cross-border coordination, management of a global carrier network, and multimodal transportation.
Can Small Companies Use Managed Transportation?
Small and mid-market companies can benefit from MT as it gives them access to high-end expertise and technology they couldn’t build internally. MT is often most beneficial to growing businesses that need to scale without the overhead of building a full logistics team.
Managed Transportation Comparison Questions
Managed Transportation vs. 3PL, Dedicated Fleet, and In-House Teams
Managed transportation differs from traditional 3PL models by focusing on strategic optimization and oversight rather than transactional freight execution alone. MT offers greater scalability without ownership costs compared to a dedicated fleet. In-house transportation teams provide direct control but often require significant investments in terms of technology and staffing. Managed transportation combines expertise, technology, and operational support into a scalable service model that reduces costs and maintains control.
Managed Transportation vs. Transportation Autonomy
Traditional managed transportation relies on operational teams and planners that are supported by software and other technology. On the other hand, transportation autonomy uses AI-driven systems that automate planning and optimization. They also execute decisions in real time. Both models aim to improve transportation performance, but transportation autonomy focuses on reduced manual intervention and is suitable for companies with large shipment volumes. Companies that wish to benefit from managed transportation can start with the traditional service and gradually switch to autonomous capabilities over time.
Managed Transportation vs. Buying a TMS vs. Hiring a 3PL vs. AI Point Solution
Investing in a TMS provides the technology, but still requires internal resources to manage optimization and execution. A traditional 3PL focuses primarily on freight brokerage and carrier coordination. AI point solutions solve specific operational problems but may not address the transportation strategy. Managed transportation combines technology, operational expertise, analytics, and execution into a single comprehensive solution.
Still Have Questions? Let’s Talk.
The best managed transportation strategy depends on your company’s goals, growth plans, and the current state of your logistics. Loadsmart’s managed transportation helps shippers reduce freight costs, scale operations, and benefit from AI-powered tools.