These two types of brokers differ primarily in the services they offer. A freight broker works only with a company and a carrier to transport a company's products, whereas 3PL services include inventory management, order fulfillment, warehousing, and distribution.
FREMONT, CA: Based on the broker's knowledge of carriers' availability, routes, pricing, modes of transport, and capabilities, a freight broker helps companies find the right carriers.
Working with a freight brokerage has the following advantages:
● For the transportation of goods, a freight broker acts as a single point of contact.
● Freight brokers are experts in freight pricing and availability.
● Brokers have established networks of freight providers and know the capabilities of those providers.
● Freight brokers plan routes, track freight, and negotiate prices on behalf of companies.
If a company needs logistics services that go beyond transportation, a 3PL broker may be the best option. In the supply chain, freight brokers specialize only in transportation.
3PL brokers: what do they do?
In addition to freight brokerage, 3PL brokers offer a range of logistics and goods management services. The scope of 3PL brokerage services varies.
The following services are offered:
● Similar to a freight broker, a freight brokerage offers freight services.
● Goods are received from a port of entry or manufacturing center.
● Storage of goods in warehouses.
● Management and replenishment of inventory.
● Fulfillment of orders, including picking and packing.
● Wholesale and retail distribution of goods.
● End-user delivery to businesses or individuals.
Depending on the client's needs, they can choose from end-to-end logistics or select individual services. The 3PL broker manages the entire logistics chain for a company, from initial pickup to final delivery.
Working with a 3PL brokerage has the following advantages:
● An account manager and a single point of contact are provided by a 3PL brokerage.
● As part of the logistics lifecycle, a 3PL brokerage provides complete end-to-end management.
● If needed, 3PL brokerages also offer a range of core and value-added logistics services.
● From receiving orders and inventory control to picking, packing, and distributing, a 3PL brokerage offers order management.
● Through network design, automation, and innovation, 3PL brokerages optimize logistics.
● While 3PL brokers are often a cost-effective way to outsource a company's logistics needs, supply chain leaders should ensure they fully understand the services they agree to.
3PL brokers and freight brokers differ in the following ways:
They differ primarily in the services they offer. A freight broker works only with a company and a carrier to transport its products. Inventory management, order fulfillment, warehousing, and distribution are all included in 3PL services.
