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What a 3PL can do for your supply chain & shipping costs

September 21, 2023 / US
What a 3PL can do for your supply chain & shipping costs

The modern supply chain is riddled with hidden opportunities for cost and process improvements. Outdated workflows can lead to miscommunications and shipping delays. Without real-time visibility into freight movement, shippers may struggle to set a realistic delivery timeline and ensure customer satisfaction. Lack of data can also hinder businesses from scaling their operations cost-effectively. And even if everything else falls into place, managing multi-stop shipments and time-sensitive expectations during the last mile can be a struggle—especially for small shippers.

Moving goods can be an expensive, complicated endeavor. But with the help of a Third-Party Logistics (3PL) provider, businesses can streamline their shipping operations, reduce costs, and lay the groundwork for transportation success.

What is 3rd party logistics (3PL)?

In the freight industry, Third-Party Logistics providers (commonly referred to as 3PLs) provide shippers with a range of logistics and supply chain management services. These include transportation, warehousing, distribution, inventory management, order fulfillment, freight forwarding, customs brokerage, and more.

Partnering with a 3PL empowers businesses to focus on their core competencies while outsourcing various logistics functions to specialized experts. As a 3PL provider, Uber Freight has the expertise, infrastructure, and resources to optimize supply chains and reduce costs, effectively improving delivery times and boosting network efficiency.

3PL services offer incredible flexibility for shippers looking to take their transportation process to the next level. Some might only use certain services on an as-needed basis, while others might outsource their entire logistics operations. With a 3PL partner, businesses can scale their logistics functions according to their needs and market demands.

Connect with an Uber Freight representative today to learn more about our 3PL logistics solutions.

What can a 3PL do for a shipper’s bottom line?

3PLs offer a wide range of services and expertise that can alleviate the challenges and pain points associated with shipping and logistics. By partnering with a 3PL, businesses can leverage specialized resources to identify cost saving opportunities, achieve better freight visibility, improve customer satisfaction, and scale their operations.

1. Faster transportation

Using advanced tracking systems and real-time visibility tools, 3PLs offer businesses a seamless monitoring system that ensures ease and efficiency throughout the entire shipment journey. Armed with performance metrics that otherwise might not be accessible to the average shipper, 3PLs can determine the optimal facility layout and design for more efficient picking, packing, and delivery. And by strategically placing inventory to aid rapid retrieval, shippers can employ agile order fulfillment techniques to move goods in record time.

2. Low-cost warehousing and distribution

3PL services achieve cost-effective warehousing and distribution by capitalizing on existing infrastructure, economies of scale, and specialized expertise. They are able to work with more than one shipper at once, allowing multiple organizations to collaborate and share their respective warehouse networks to distribute costs.  This cuts back on the financial overhead needed to build the necessary infrastructure.

Efficient warehousing can also include cross-docking. Cross-docking refers to when incoming goods are directly transferred to outbound transportation or distribution—reducing material handling or eliminating the need for large warehouse areas.

One shipper using Uber Freight was able to reduce costs by $10 million annually by following our best practices for streamlining warehouse operations.

3. Only pay for the resources You need

A 3PL offers increased flexibility compared to developing these functionalities in-house. Shippers are able to scale services up or down in response to changing demand patterns. This ensures that shippers only pay for the services they require, minimizing unnecessary expenses and enabling them to focus on more worthwhile efforts like strategic growth initiatives. Even when it comes to labor, shippers can rely on a 3PL’s logistics personnel who are equipped with the right technology and expertise instead of hiring in-house.

4. Saves time and money with rework

3PLs can identify opportunities for improvement by strategically examining and optimizing various aspects of the supply chain—such as order processing, packaging, and routing. This reengineering allows businesses to effectively streamline workflows, eliminate redundancies, and enhance operational accuracy for shippers.

5. Improved cash flow via vendor managed inventory

Vendor Managed Inventory (VMI) is a collaborative supply chain strategy where the supplier, rather than the customer, takes responsibility for managing and replenishing inventory levels. In a VMI arrangement, the supplier monitors the customer’s inventory levels remotely and proactively initiates replenishment orders based on agreed-upon inventory thresholds and demand forecasts. VMI significantly bolsters cash flow efficiency by aligning inventory levels with actual demand and consumption patterns. By reducing excess inventory, companies are able to redirect funds to more strategic initiatives instead of leaving them tied up in stockpiles.

6. Expert execution and supervision

Third-Party Logistics providers have a unique benefit over in-house operations strategies: they’re dedicated experts. 3PLs bring specialized knowledge, extensive resources, considerable technology investments, and a focus on core competencies that would be costly to build out in an internal team. Their established networks of carriers, warehouses, and distribution centers allow businesses to access resources without heavy upfront investments.

How to choose a 3PL provider

With many 3PLs, freight brokers, and logistics providers on the market today, shippers may feel overwhelmed by the multitude of options. Selecting the right transportation partner requires careful consideration of several key factors, from cost and value to scalability and expertise.

Tailored industry knowledge, history of innovation, and the ability to grow with your business—all at the right price—are essential to choosing the best 3PL partner.

Expertise and industry knowledge

Partner with a 3PL that has experience and expertise in your specific industry. An in-depth understanding of the challenges, regulations, and nuances of your sector can lead to more effective solutions. Look for a provider with a proven track record of successfully handling logistics for businesses similar to yours.

Uber Freight brings a wealth of experience and knowledge to shippers entering the world of freight logistics. Leading businesses across industries have leveraged Uber Freight’s services to take their business operations to the next level. From Pet Supplies Plus to Del Monte Foods, these shippers know that Uber Freight has the 3PL expertise to help.

Technology and innovation

Evaluate their technology solutions. A modern 3PL should have advanced systems for real-time tracking, visibility, and reporting. Ensure their technology is compatible with your systems and can integrate seamlessly to provide insights and streamline communication.

Technology is at the forefront of Uber Freight operations. Digitally-enabled, end-to-end managed transportation makes it easy for shippers to access the services they need. Whether it’s viewing market insights, evaluating performance metrics, or booking loads, Uber Freight has the technology to support. Explore our suite of solutions today.

Scalability and flexibility

Consider your business’s growth trajectory. Opt for a 3PL that can scale its services to accommodate changing demands. A flexible provider should offer a wide range of services and be able to adjust their operations based on your evolving needs and market conditions.

Uber Freight’s one-stop shop Shipper Platform is available to businesses needing immediate support. Once you’re ready to scale, our team of experienced logistics professionals can build a custom solution that meets all of your needs.

Cost and value

Understand the provider’s pricing structure and assess the value they bring to your operations. While cost is important, also consider the overall value, including the impact on efficiency, customer satisfaction, and your bottom line. Compare the costs with the benefits of their services to make an informed decision.

With Uber Freight’s flexible offerings, businesses can select only the services they need. Our dedicated team is able to build tailored solutions designed to meet your operational needs so you only pay for what you need.


What is 3PL vs 4PL?

Third-Party Logistics (3PL) and Fourth-Party Logistics (4PL) represent distinct levels of supply chain management outsourcing. While a 3PL offers specific logistics services such as transportation, warehousing, and distribution, 4PLs take on a more comprehensive role beyond individual logistics functions.

A 4PL acts as an orchestrator, overseeing and coordinating the entire supply chain on behalf of the client. They manage not only the physical movement of goods but also the strategic aspects, such as sourcing, procurement, technology integration, and overall supply chain optimization. A 4PL is a strategic partner that designs, implements, and manages end-to-end supply chain solutions, often working with multiple 3PLs and other partners to ensure seamless operations. They execute a more holistic approach to supply chain management, focusing on strategic alignment, efficiency, and long-term value creation.

At Uber Freight, we understand that companies have differing levels of need when it comes to outsourcing logistics. With our one-stop-shop freight shipping services, businesses can get transparent pricing for full truckload and less-than-truckload capacity. Book high-quality dry van, reefer, and flatbed loads instantly using Uber Freight’s Shipper Platform. Tap into one of the largest carrier networks to save time and money on every load, on every lane.

For companies looking for more comprehensive support, our Transportation Management System (TMS) includes hands-on managed services from our team of world-class logistics experts. We know transparency is paramount, so our TMS offers control tower visibility across all shipments in transit, from origin to destination.

Finally, our managed transportation services offer shippers direct support throughout the entire supply chain—from procurement and carrier management, all the way through benchmarking and growth consulting.

How much does 3PL cost?

The cost of engaging a Third-Party Logistics (3PL) provider can vary widely based on several factors, including the specific services required, the complexity of your supply chain, the volume of goods being handled, the industry you’re in, geographic location, and the level of customization needed. Different 3PL providers might have varying pricing structures, with differing blends of transactional fees, variable costs, upfront costs, and additional services.

But while 3PL services can come with costs, they can also create long-term value through improved efficiency, reduced operational complexity, and optimized supply chain management.

To get an accurate understanding of the costs involved, connect with an Uber Freight representative today. We can provide interested shippers with a detailed pricing proposal that meets your company’s specific needs.

What is 3PL fulfillment?

3PL fulfillment refers to the process of outsourcing order fulfillment operations to a Third-Party Logistics (3PL) provider. In this arrangement, the 3PL oversees and manages the order fulfillment process, including receiving customer orders, picking and packing products, and shipping them to end customers.

Outsourcing fulfillment to a 3PL allows businesses to focus on their core activities while benefiting from the expertise, resources, and efficiencies that the 3PL brings to the order fulfillment process. It can lead to faster order processing, reduced shipping times, improved customer satisfaction, and cost savings through optimized logistics operations.

Is Uber Freight a 3PL provider?

As a freight logistics and brokerage company, Uber Freight offers a variety of 3PL services to shippers. Depending on a company’s needs, Uber Freight can function as a 3PL, 4PL, or even 5PL overseeing the entire supply chain.

Armed with a suite of best-in-class logistics services, Uber Freight can be an external partner that brings efficiency and cost-savings to your supply chain. Our logistics services include:

  • Drop – Reduce live loading and unloading dwell time with drop and hook shipping.
  • Shipper collaboration – Utilize your empty hauls, or another shipper’s by leveraging Uber Freight’s extensive network.
  • LTL pooling – Optimize truckloads by combining your LTL shipments with other shippers’ at one of six regional cross-docks.
  • Drayage – Streamline port moves using Uber Freight’s expert local management, standardized processes, and modern technologies.
  • Continuous moves – Link shipments back-to-back (-to-back) for greater efficiency and cost reduction.
  • Carrier management – Gain actionable insights, flexible scale, and operational excellence from an experienced team of management professionals.
  • Freight Audit and Payment (FAP) – Improve your carrier relations with flexible and secure payment options.

Explore 3PL possibilities with Uber Freight

3PL services can take your business to the next level by outsourcing complex logistics operations to a team of experts.

No matter the degree of support your business needs, you can elevate your freight logistics with Uber Freight. Seamlessly connecting you with a vast network of reliable carriers and real-time insights, Uber Freight empowers your business to ship smarter, faster, and more efficiently. Whether you’re a small business looking to scale or an established enterprise aiming to optimize operations, partnering with Uber Freight unlocks a world of streamlined logistics at your fingertips.

Revolutionize your shipping strategy today and drive your business forward with Uber Freight.

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