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Tapping into 3PL services

Aug. 24, 2018
CLX Logistics presents potential solutions for ‘roadblocks’ in the trucking industry.

According to CLX Logistics, it’s a tough road for small and large trucking companies with "roadblocks" affecting operations, personnel, performance, and bottom line.

Some of these "roadblocks" listed in its most recent infographic include the driver shortage, which is dealing with a 60% turnover rate, 4.1% of the national population filing for unemployment, and hiring and retention issues, as well as the aging current driving force. In addition, insurance costs are rising up to a 5% increase for good carriers and to a 10% increase for average carriers. This sees a decrease of truck insurers, which raises the current rates.

With the rise in demanding service, CLX noted that 64% of consumers won’t pay extra for less than two-day shipping for their products. This demand is challenged by the increase of fuel costs, which is up 50% since 2016, according to CLX. This escalates fuel surcharges and increases costs for U.S. shippers.

The trending "roadblock" item on CLX Logistics’ infographic was the increased regulations regarding the electronic logging device (ELD) mandate. According to CLX, this rule has seen a 3-5% decrease in productivity, a 16% decrease in average mile/day, and brings more liability from the Food Modernization Safety Act, all of which add an increased use of compliance, safety, and accountability (CSA) data by insurers.

Despite these "roadblocks," CLX suggests that partnering with 3PL services and carrier networks “is becoming more common as the pros continue to outweigh the cons” with five elements of benefits.

With this potential partnership, truckers can increase their scalability and “achieve domestic or international growth goals, minimize costs by easily scaling up or down, and gain access to larger shippers’ freights.” By integrating technology, drivers can “utilize the latest TMS technology, access dedicated tech teams and on-hand experts, and tap into proprietary data for lanes, modes, and rates.”

According to CLX, these 3PL resources can bolster capabilities with other modes and services, benefit from association memberships and certifications, and augment sales, marketing, and hiring efforts.

The financial stability brought by a 3PL partnership, notes CLX, could be seen by tapping into relationships with multiple suppliers, getting paid faster than one would with a shipper, reducing empty miles by re-loading trucks, and minimizing start-up and operational costs.

The safety benefits added by CLX could be more protection from lawsuits, benefits from more comprehensive insurance, and assurances that standards and regulations are met.

By tapping into this strategy, CLX states that small companies could “carve out a niche or specialty to become the go-to provider, comply with all regulations for drug testing and maintenance, and participate in industry events” that can grow a company’s reputation. Large companies can “demonstrate employee appreciation to reduce turnover, bolster capabilities through other partnerships, and strengthen carrier relationships with more amenities.”

With these potential solutions, drivers as well as companies could, as CLX puts it, bypass the roadblock barriers.

About the Author

Catharine Conway | Digital Editor

Catharine Conway previously wrote for FleetOwner with a Master of Science in Publishing degree and more than seven years’ experience in the publishing and editorial industries. Based in Stamford, Conn., she was critical to the coordination of any and all digital content organization and distribution through various FleetOwner and American Trucker channels, including website, newsletters, and social media. 

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