TL logistics software is used to optimize the truckload shipping process; that is, TL logistics software is specifically applicable to companies that ship full (as opposed to partial) semi trailers of products. If your company produces a smaller number of goods whose volume doesn’t equal a full truckload, paying for truckload (TL) shipping would be wasted money. Instead of using TL logistics software, you would use LTL (less than truckload) logistics software.
In LTL shipping, carriers collect partial loads from two or more shippers and split the load cost between as many companies as contribute to the load. Both TL and LTL logistics software are specific customizations within the larger context of truckload transportation management software-also referred to as freight management software. Both small and large companies use freight management software, the key determinant being whether or not they employ logistics experts. If they don’t, they have a need for the software.
The basic advantage of TL shipping over LTL shipping is that freight is not handled while en route. In some cases, one TL carrier passes a freight load to another TL carrier who delivers it to its destination. But the freight remains in the trailer, reducing the chance of breakage and lost freight, canceling warehouse fees and decreasing delivery time. However, if you operate a small to midsize company that doesn’t produce enough product volume to justify TL shipping, TL shipping may still be an option.
In some cases, producers of multiple partial truckloads use a TL carrier to move their freight to an LTL carrier’s break-bulk facility. At the break-bulk facility, the load is broken down into the original partial shipments that are then delivered to their destination by the LTL carrier. Integrating TL and LTL shipping is one example of how TL logistics software can benefit small to midsize companies that rarely produce traditional truckloads.
Traditionally, small to midsize companies that don’t employ logistics professionals outsource their logistics to third party logistics (3PL) providers. But with the current economy causing 3PL providers to raise their rates in order to account for the lower level of freight discounts that they are receiving from shipping carriers, more and more companies are switching to LTL and full truckload logistics software. 3PL providers make their profits by receiving freight discounts from shipping carriers and then charging shipping companies a fee that exceeds the discounted freight rate.
As a result, 3PL providers only work with carriers that offer preferred discounts, meaning that shipping companies ultimately have less shipping options through a third party logistics provider than through logistics software. By using logistics software instead of a 3PL provider, companies become their own logistics provider and no longer pay a middleman to perform freight logistics.