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What is managed transportation – examples and benefits explained

In an increasingly dynamic logistics landscape, agility is paramount. This demands shippers to have operational awareness—the ability to quickly anticipate and adapt to changes in the supply chain, market dynamics, and customer demands.

To remain light on their feet, shippers should continually improve their transportation strategies using real-time insights. By outsourcing the complexities of supply chain logistics to a specialized third-party provider, businesses can more easily identify and apply these insights to their decision-making, enabling smoother, faster, and more adaptable shipments.

For businesses ready to uplevel and expand their logistics operations, read along to uncover the benefits of managed transportation. By working with our team of experts at Uber Freight, you can save on costs, broaden your network, and drive strategic improvements to ensure efficiency and stability throughout market swings.

Already interested? Connect with an Uber Freight representative today.

Managed transportation defined

While self-service transportation management systems (TMS) equips shippers with control and visibility over their operations, managed transportation offers a more hands-off approach, leveraging external expertise to achieve operational excellence.

This strategic outsourcing approach allows a specialized third-party provider to handle the planning, execution, and management of transportation activities, including carrier relationships, route optimization, and performance monitoring. Outsourcing these functions to a dedicated provider gives shippers room to grow, helping them make sweeping improvements to their supply chain effectiveness, competitive advantage, and cost-efficiency by tapping into a wealth of knowledge and advanced analytics capabilities.

From securing optimal capacity and favorable rates, to ensuring compliance with contracts and industry regulations, to harnessing real-time shipment tracking and reporting capabilities, a managed transportation provider not only keeps operations in check, but also provides a solid strategic framework for shippers to achieve transportation success. Leaning on expert data, knowledge, and communication, shippers can ensure that the right modes and carriers are chosen for specific shipments, contributing to enhanced service levels and customer satisfaction.

Managed transportation providers optimize shipper operations by…
Selecting the right carriers to secure optimal capacity.

  • Ensuring transparent rates by negotiating advantageous contracts.
  • Enabling 360-degree visibility and proactive issue resolution with real-time shipment tracking and exception management.
  • Minimizing transit times by planning routes and consolidating loads. 
  • Leveraging advanced data analytics and reporting for performance insights and continuous improvement.
  • Enabling seamless documentation management to monitor regulatory compliance. 

Managed transportation services benefits

Managed transportation sources offer businesses top-tier support for their logistics operations that improve efficiency, offer cost savings, and enhance overall supply chain performance.

Overall efficiency

Managed transportation providers use their expertise and technology to optimize transportation routes, consolidate shipments, and negotiate favorable rates with carriers. These improvements lead to cost savings through reduced transportation expenses and improved economies of scale. Improved delivery timelines and reliability from efficient route planning can also translate to enhanced customer satisfaction and retention.

Enhanced visibility and analytics

With real-time tracking, reporting, and analytics, managed transportation provides increased visibility into the movement of goods and valuable insights into transportation performance and cost trends. As a result, companies can make informed decisions, respond quickly to any disruptions and identify opportunities for continuous improvement in their supply chain.

Flexibility and scalability

Managed transportation services are adaptable to changing business needs and market dynamics. Services can scale to accommodate the growth of a company’s transportation needs, whether due to increased demand, market expansion, or changes in the business landscape. Companies can easily scale their transportation capabilities up or down based on fluctuations in demand or business growth.

Risk mitigation

Managed transportation providers help mitigate risks associated with transportation, compliance, and carrier performance. Transportation experts are able to monitor = transportation operations compliance with regulatory requirements and industry standards, reducing potential liabilities.

Access to expertise and technology

By partnering with a managed transportation provider, companies gain access to industry expertise, advanced TMS solutions, and best practices. This access enhances decision-making and overall efficiency in logistics operations.

Furthermore, outsourcing allows companies to concentrate on their core operations and strategic initiatives. They can redirect resources and efforts towards areas that directly impact their growth and competitive advantage.

Key components of a robust managed transportation offering

A robust managed transportation offering includes planning and optimization, carrier relationship management, shipment execution management, and advanced analytics and reporting. Together, capabilities across these four areas can boost logistics operations to deliver a strong managed transportation offering.

The end result? A transparent, streamlined logistics process with faster, more reliable service, unparalleled cost savings, and a competitive edge in the market.

Transportation planning and optimization

Planning and optimization involves leveraging advanced TMS solutions and sophisticated algorithms to optimize routing, carrier selection, and shipment consolidation. By analyzing shipment volume, destination, carrier capabilities, and service requirements, industry experts can devise optimal routes and strategies to improve efficiency and minimize costs.

Carrier management and relations

A successful managed transportation offers effective carrier management made possible by freight professionals who are able to build relationships with carriers. Managing relationships with carriers that prioritize cost, reliability, service quality, and compliance leads to efficient operations. Managed transportation providers can negotiate favorable rates, establish contracts, monitor carrier performance, and ensure adherence to service agreements.

Shipment execution and tracking

Managed transportation providers can offer timely and accurate execution of shipments by coordinating with carriers for pick-ups, tracking shipments in real-time, and ensuring on-time deliveries. Cutting-edge technology for tracking and reporting provides visibility into the status of each shipment, enabling proactive management of potential delays or disruptions.

Performance analytics and reporting

Detailed performance analytics and reporting are crucial for continuous improvement and data-driven decision-making. Managed transportation providers can analyze key performance indicators (KPIs) such as carrier performance, transportation costs, delivery times, and compliance. Insights gathered from these analytics empower companies to identify areas for optimization, negotiate better rates, and enhance overall supply chain efficiency.

Examples of managed transportation solutions

Regardless of your business industry, managed transportation solutions can offer many benefits. Any business looking to take their logistics operations to the next level can turn to managed transportation.  Here are a few examples:

Retail industry

In the fast-paced world of retail, companies strive to meet customer expectations for timely deliveries. A managed transportation solution can efficiently manage last-mile shipments, which are critical for customer satisfaction.
During seasonal sales or promotional events, for example, the provider can dynamically adjust transportation strategies to handle increased shipment volumes, coordinating with carriers to meet the surge in demand while maintaining delivery schedules. This approach enhances supply chain efficiency, reduces transportation costs, and helps retailers manage inventory effectively, ultimately creating a seamless shopping experience to customers.

Consumer packaged goods (CPG) industry

With constant movement of products and new launches as often as once a month, the consumer packaged goods (CPG) industry requires careful planning for shipments. In the case of a new product launch, a technology-driven managed transportation solution can help customize transportation plans to meet heightened demand. The provider can consolidate shipments, optimize routes, and select the most cost-effective carriers, enabling CPG companies to turn around time-sensitive orders.

Automotive industry

Transporting expensive, large vehicles can be a logistical challenge, as these bulky loads require specific handling protocols to ensure they arrive unscathed. A managed transportation provider can coordinate the distribution of finished cars to dealerships, effectively managing the intricacies of transporting varying vehicle types and models over long distances.

When launching a new model, the provider can meticulously plan the transportation routes, schedule deliveries, and manage the entire process to ensure new vehicles reach dealerships promptly, aligning with marketing and sales strategies. Even during the manufacturing process, a provider can help optimize the movement of parts and materials from suppliers to plants.

Chemical industry

Chemical shipments require additional caution to ensure safety and compliance while moving potentially hazardous materials. In many cases, chemicals require specific handling instructions or temperature control that necessitates a refrigerated truck.

A managed transportation provider can handle the movement of hazardous goods in compliance with safety standards by designing transportation routes that minimize risk and adhere to regulatory requirements, including labeling and documentation. Tracking systems also offer the ability to monitor the transportation process in real-time, allowing for swift response to any potential incidents and ensuring the secure and timely delivery of chemical products to manufacturers, distributors, or end-users.

Managed transportation solutions with Uber Freight

Ready to take your logistics operations to the next level? Get started with Uber Freight today and trust our supply chain experts and data scientists to deliver unmatched efficiency to your business. Our team is an extension of your own, offering end-to-end management of your transportation needs and delivering improvements in cost, capacity, and sustainability in the process.
Uber Freight’s managed transportation solutions are always tailored to meet the needs of your business. Solutions include access to our enterprise-grade TMS solution which includes control tower visibility of your entire supply chain. We have relationships with carriers across the country, allowing your business the flexibility to find what works best for you. Our team of experts uses robust analytics and benchmarking to deliver strategic advice across the board.

We’re ready to help drive your business to success. Connect with an Uber Freight representative today.

More managed transportation resources:

White paper: How to leverage the power of a 4PL

Case study: How a Canadian manufacturer’s digital logistics transformation improves service levels and data visibility

Is it time for a a fleet assessment?

E-book: How to achieve high-quality service without sacrificing cost

Reducing empty miles with network optimization

White paper: OTIF – How to minimize fines and establish trust in your supply chain