Picture this: your logistics manager is questioning an accessorial charge with one carrier, while refreshing a tracking portal for another. At the same time, they have to deal with a freight invoice that does not match the quote. And somewhere in the warehouse, a dock supervisor is wondering why the pickup confirmed yesterday did not show up. This is exactly the kind of chaos that managed transportation is supposed to fix.

Managed transportation is a model of third-party logistics in which the shipper outsources the planning, execution, and day-to-day management of freight operations to a logistics partner while retaining a say in decisions that affect their supply chain. For companies stuck between doing it themselves and not having the resources to do it well, it may be the most practical — and cost-effective — move.   

What Managed Transportation Actually Covers

Managed transportation covers carrier sourcing and rate negotiation, load planning, shipment execution, in-transit tracking, freight audit and payment, and performance reporting. Basically, the shipper leverages the 3PL’s network of carriers, technology (usually a transportation management system), and an operations team.

The idea is to oversee your entire program, in all your lanes, carriers, and modes. The managed transportation partner can see the trends in your freight data. They can also catch billing errors before they reach you and monitor carrier performance so you don’t have to.

The scope can differ, though. Some shippers outsource all of their operations. Others keep strategic decisions in-house while outsourcing execution. The third-party logistics study reveals that 87% of shippers are increasingly dependent on outsourced logistics services, yet most prefer a blended approach instead of a complete transition. That flexibility is part of what allows managed transportation to work for companies in various stages of growth.

Signs Your Operation Might Need It

Managed transportation is not for every shipper. But there are telltale signs that a company has reached the ceiling of what it can do on its own.

1. Ever-Increasing Freight Spend

This happens when carrier performance varies, and there is no structured scorecard to measure it. Instead of planning ahead, most of the logistics team’s week is spent doing reactive work, chasing late shipments, resolving invoice disputes, and tracking down proof of delivery.

2. Expansion into New Markets

The company is expanding into new markets or areas, but lacks the carrier coverage. Or compliance demands such as temperature documentation for reefer shipments and on-time in-full reporting for retail customers, are stacking up. Managing all of that with spreadsheets and phone calls has a shelf life.

What a Managed Transportation Partner Actually Does Day to Day

The work falls into a few categories.

1. Carrier Procurement

That’s sourcing the right carriers for each lane, negotiating rates, vetting them for safety and service, and keeping the network current as your freight profile changes.

2. Load Planning and Mode Selection

A good managed transportation partner will know when to consolidate LTL shipments, when FTL makes more sense, when a reefer is needed, and when cross-docking can shave a day off transit. They always get the load on the right equipment with the right carrier.

3. Day-to-Day Execution of Shipments  

This entails managing tender loads, tracking in transit, and handling exceptions when a pickup is missed or a delivery window moves. Freight audit and payment runs, catching duplicate charges, incorrect accessorials, and rate discrepancies before they hit your books.

4. Reporting

Spend analysis by lane, carrier scorecards, on-time delivery trends, and cost per unit analysis. The type of data that most midsize shippers know they need but don’t have the systems or staff to consistently produce. 

Managed Transportation With EFS

Managed transportation with Entourage Freight Solutions means removing your freight program from your team’s plate so they can focus on what really moves the business forward. With EFS, you have a carrier network, tracking, and reporting that a full managed model requires, including FTL, LTL, reefer, and cross-docking.

EFS acts as a managed transportation partner for shippers in foodservice and other industries by providing the carrier network. Connect with us to see if managed transportation is right for your operation.