In a recent article, FreightWaves CEO Craig Fuller, gives a powerful summary of the current popularity of freight brokers in the US supply chain, along with a concise history of how freight brokers have arrived at this point. It’s a fascinating article with great insights – so great, in fact, that we’re going to share and summarize it in this blog post. We’ll also provide thoughts on how it applies to bulk freight and the benefits of leaning on bulk freight 3PLs like Bulk Connection.
So, what’s changed?
Years ago, freight brokers (or non-asset 3PLs) were primarily relied on (1) to handle loads that asset-based carriers didn’t want, and (2) to fill in as a last resort if carriers couldn’t handle current volumes.
Over time, however, freight brokerages have upped their game in terms of technology and, perhaps most importantly, customer service. They simply outperform most carriers in terms of the personalized service and expertise they offer to shippers in a crowded marketplace. This is especially true for smaller shippers that aren’t large enough to warrant attention from bigger carriers.
There is also the fact that non-asset 3PLs have large networks of carriers, which give shippers different options to choose from as well as better coverage and capacity than most single carriers can offer on their own.
For these reasons and more, freight brokers in the US no longer just receive the scraps that carriers don’t want. In fact, the article goes on to say that “it is common for multiple freight brokerages to be in primary positions in shippers’ routing guides, often as the top choice, beating out their asset-based competitors.”
It’s not just shippers that have come to rely heavily on freight brokers. Smaller carriers also turn to 3PL providers to land shippers’ loads.
In 1980, when the Motor Carrier Act of 1980 deregulated the trucking industry, there were approximately 18,000 trucking companies in the US. There are now over 531,000 active trucking fleets.
With so many carriers, competition is fierce and it can be harder for smaller carriers to win shippers’ business. By forming relationships with – and earning the trust of – freight brokers, however, these smaller carriers can receive steady loads with shippers that the brokerage works with.
The rising popularity of US freight brokers extends into the trucking of liquid and dry bulk shipments, as well. Following are just some reasons why.
The shipping of bulk products requires specialized knowledge and careful execution. This careful execution involves the vetting of carriers, the intake of shipper information, and the planning of project details. Armed with this knowledge, your freight 3PL can then find the best liquid and dry bulk carriers to transport your products.
With the truck driver shortage and fluctuating industry factors, bulk capacity can be hard to come by. When capacity tightens, shippers can spend time and resources looking for capacity among individual carriers, one at a time. With a bulk freight broker, one phone call is all you’ll need.
If you’re shipping chemicals or other types of bulk products, specialty brokers will understand the unique characteristics and requirements that must be considered. These include safety data sheet (SDS) information, temperature requirements, and the list of incompatible prior product (products that must not have shipped in a tank or trailer prior to your product).
The fewer details you have about your product, the greater the concern carriers will have about handling your freight. Uncertainty equals risk in the eyes of carriers, which results in higher rate quotes for you. Experienced bulk freight brokers help you fill in the information gaps. This ensures that the carrier understands the full picture before quoting, which results in lower bulk freight rates for you.
While such an expansive network is a definite plus on the side of freight brokers, it means nothing unless every one of those carriers is reliable and worthy of transporting your product. To ensure this is the case, freight brokers (the best ones, at least) will thoroughly vet their carriers to make sure they are capable and qualified.
Such vetting is vital when it comes to any product, but it’s even more important when those products are volatile chemical or delicate food-grade items. In addition to the standard vetting procedures involved with more innocuous products, freight brokers will ensure that all industry-specific requirements are met by the carriers (and their drivers) that handle these products.
Speaking of chemical and food-grade companies, many of them will choose to ship products ‘blind.’ In such instances, the Bill of Lading may show the name of the distributor or be left blank – instead of showing the name of the actual shipper. In other cases, ‘double blind’ shipments may be requested. With these shipments, both the shipper and receiver are confidential.
Brokers like Bulk Connection that understand your products also understand what needs to be done to maintain product integrity throughout the shipping process. For temperature-sensitive liquid products that can’t fall below a certain temperature, these brokers work with carriers to protect product integrity through in-transit heat or steaming.
When railroad service becomes disrupted, your supply chain can be negatively impacted. Fortunately, bulk freight brokers can come to the rescue, sourcing trucks from far and wide to unload product from the stuck railcars and continue the products’ journeys over the road. While not a routine occurrence, such emergency shipping solutions help many companies out of bind when accidents or weather events stop the flow of materials.
While shippers have more options than ever in booking loads, something important has gotten lost along the way: interpersonal communication. Bulk shipping, whether liquid or dry, is a complicated business. There is a pretty lengthy list of checkboxes that must be ticked for the job to be done right. The quickest – and most effective – way to check these boxes is also often the oldest way – two people communicating with each other.
Since 1987, we’ve delivered expert advice and execution to shippers in the chemical and food-grade industries. We guide your shipments every step of the way (and, yes, we’ll always pick up the phone). To learn more about our services and why we’re a trusted resource for bulk shippers and carriers all across North America, contact Bulk Connection today.