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?

Shipping company

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

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?

Shipping company

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

Confused? 

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

Shipping company

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.

Abonnez-vous à notre blog

Shipping Strategy 2022