How does a 3PL broker differ from a freight brokerage?
The processes involved in moving goods across international borders can become extremely complex, very quickly. This makes it unsurprising that all manner of companies needing to execute such operations turn to a freight broker or a third-party logistics (3PL) broker to coordinate it all.
However, it might not be entirely clear to you what the difference is between a 3PL brokerage and a freight brokerage. Below, then, we have set out why the two terms are not entirely synonymous, and what the implications of this may be for your organisation.
‘3PL brokerage’ is a broader term than ‘freight brokerage’
As we referenced above, a 3PL company is a third-party logistics company. It is a type of service provider, then, that either arranges or handles a range of supply-chain functions for a business. Such functions may encompass not only shipper services, but also the likes of brokering, supply chain consulting and optimisation, and warehousing and distribution.
3PL companies can vary in terms of their exact business model, and the specific areas of supply chain operations they focus on. The key thing to remember, though, is that “3PL brokerage” is the broader term than “freight brokerage”, with the latter being just one type of service a 3PL may offer.
So, while a freight broker is a type of 3PL broker, not all 3PLs out there will actually offer freight brokerage among their services.
What will all this mean when you search for freight services for your company?
Hopefully, if you are on the lookout specifically for freight brokerage services, the above will have helped make clear to you how the term “3PL brokerage” differs from “freight brokerage”.
In practice, many 3PLs do offer freight brokerage by sea and air, and often by road as well. However, you should double-check what exact services and solutions are offered by the particular 3PL company you have your eye on.
Here at KTL UK, for instance, we are proud to be a 3PL provider with extensive knowhow and an impressive track record in areas that go beyond the mere brokerage of freight – for example, supply chain management, customs clearance, and warehousing.
When you are considering, then, whether to do business with a freight brokerage or instead a 3PL provider that might make available a wider range of services than just freight brokering, you will need to ask yourself certain questions.
Does your company, for example, already have certain in-house logistics capabilities that might make a 3PL company’s broader range of services less necessary than they may be for other companies? Or are there certain other logistics services that you know your firm will need, and that a given 3PL company offers at an attractive price?
If, on answering these questions, it becomes clear to you that KTL could be your organisation’s best choice for freight brokerage by sea and air, and/or for any of a wide range of other services, please don’t hesitate to contact us today.