A Shipping Company Guide to Logistics and Freight Management: What’s the Difference?

Amanda May 05, 2022 • 4 Min read
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eCommerce has grown at a dizzying pace over the last 5 years, and the dependence on 3PLs has grown with it. Businesses know firsthand the importance of working with a shipping company that supports them and delivers a positive experience for their customers. But if you’re new to eCommerce, you’re probably just starting to realize that there’s more than one type of shipping company, the two most common categories being logistics management and freight management.

If you want to improve the efficiency of your supply chain, freight management and logistics management are critical. And while the terms logistics and freight are synonymous with the transportation and movement of commercial goods by ocean, air, rail, and truck, these terms are not interchangeable. 

Before we explore the differences between freight and logistics management, we need to first identify their roles and processes.

What is Freight Management?

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Freight management refers to the process of controlling freight movement. It’s the intricate process of planning, managing, and executing a cost-effective procedure for the delivery of products. While this appears to be a straightforward task, there’s more to freight management than meets the eye. For instance, freight management combines human resources, logistical knowledge, and data to ensure that the shipping company and carriers are in sync.

A company must execute the following actions, among others, for successful freight management:

  • Selecting a suitable transportation firm, initiating contact, and engaging specific carriers and transportation
  • Agreeing on rates, expectations, and terms
  • Creating and completing thorough paperwork that is required during the freight shipping process
  • Shipping and coordinating precise transporters to collect and deliver freight at certain times
  • Choosing a mode, then routing trucks or trailers with load balancing
  • Following the cargo's progress across the supply chain
  • Choosing, engaging, and working with customs brokers to ensure customs compliance
  • Providing an effective insurance plan for the carried cargo while also overseeing freight claims
  • Supervising and processing payments, receipts, and invoices related to freight transportation
  • Improving transportation performance, reducing travel time, lowering expenses, and managing environmental factors to ensure that the transportation process runs smoothly.There are many companies that can help you with transportation, for instance, A1 Auto Transport for shipments in Canada and US.

In addition to these activities, freight management staff may also handle additional tasks depending on the specific requirements of each cargo load. Without efficient freight management, essential organizational operations can suffer and ultimately fail.

What is Logistics Management?

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Logistics management is the process of coordinating the acquisition, storage, and transportation of resources to their final destination. Logistics management, in particular, is a component of supply chain management. It involves controlling the planning and implementation of effective cargo forwarding and storage, as well as conveying relevant information between the point of origin and the point of use to suit client expectations.

The functions of logistics management include inbound and outbound transportation management, fleet management, warehouse management, materials handling, order fulfillment, logistics network design, inventory control, supply/demand planning, and 3PL management.

Logistics management includes, but is not limited to:

  • Managing orders from suppliers to customers at all stages of the process
  • Logistics planning and management for warehouses and distribution facilities
  • Managing materials handling, packaging, and final transportation of goods
  • Inbound and outbound logistics management
  • Managing all parts of the supply chain's strategic and tactical planning
  • Designing and optimizing the flow of the supply chain network
  • Managing and establishing supplier connections
  • Managing the flow of materials, analytics and optimization
  • Ensuring end-to-end supply chain visibility 
  • Asset management, including inventories and infrastructure

Logistics Management Vs. Freight Management

There certainly are several major differences between freight management and logistics management, but there are also some striking parallels. It helps to think of logistics management as a broad term that encompasses a variety of procedures, including freight management.

While freight management may be classified as part of logistics management, it’s no less significant. Overlooking this essential component results in far reaching consequences that negatively impact the entire field of logistics management.

The Rundown

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As a business owner, it’s imperative that you take measures to enhance your own logistics management, and the first step is to find the right shipping company and tools to help you achieve your goals.

There are multiple benefits to working with a shipping company, including access to:

  • eCommerce shipping services
  • Competitive rates
  • An extensive network of carriers
  • Innovative shipping solutions
  • Multichannel integrations
  • Warehousing services
  • Fulfillment services
  • Time-saving automation

Whether you're new to eCommerce or a seasoned pro, eShipper can help you expand your online business globally. Contact us today to get started.

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