Third Party Logistics & Freight Forwarding: What's The Difference?

In the world of global transport, understanding the terms used in supply chain management is essential. You will probably hear and see terms that you have never recognised in the past, such as third party logistics and freight forwarding.

If you are considering transporting goods from your business internationally or nationally, it is important that you have a clear idea on the services available. In order to make the best decisions for a company's transportation and supply chain needs, knowing the ins and outs of transporting is essential to ensure successful transportation of goods from the manufacturer to the end destination.

Freight Forwarding

To put it simply, freight forwarders move freight/cargo from one destination to another. Freight can be moved by road, rail, air or ocean. Freight forwarders are not always the transportation companies themselves, but more often than not contract with various carriers to ensure maximum possibilities for their clients.

Freight forwarders have the choice of working both domestically and globally, therefore they have access of working with all modes of transport.

Third Party Logistics

Third party logistics providers assist in moving cargo from one location to another, however they also add extra services that may be of use to businesses. Some of the extra services supplied by third party logistics providers include: storing cargo between transport steps and processing shipments. Many clients ship their cargo to various distribution centres up until it reaches its final destination.

Third Party Logistics and Freight Forwarding

It is not uncommon for freight forwarding and third party logistics providers to exist under the same roof; however, equally it is not uncommon for both services to be offered by separate providers.

Although third party logistics providers supply a more varied selection of services, both freight forwarders and 3PL providers relieve a company of managing the transportation of goods. Other services that can be used can also relieve a company of their paperwork duties when transporting, changing freight providers and adhering to regulations.

It is important for both providers to perform the necessary service of ensuring cargo arrives in good condition and meet all the required regulations. Good freight forwarding firms and third party logistics provider will also inform companies of any expected duties or fees that will need to be paid.

To ensure companies receive all the services they need; both freight forwarding firms and third party logistics providers will offer bespoke packages designed on the services you require. Decisions will be based on the company's needs, budget, current orders and forecasts.

Editor's Note: Kerry hired a freight forwarding company to ship goods from one location to another. She found that CC Freight offers a number of different services at an affordable rate.