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What’s the Difference Between Asset-Based & Non-Asset Based 3PL?

The purpose of logistics and supply chain providers are to increase overall efficiency of a company, cut both hard costs and soft costs, decrease errors and mitigate risk, and accomplish everything on time. Logistic companies are typically sorted into two categories: asset-based and non-asset based.

A non-asset based logistics service provider does not own assets to manage and implement a supply chain. Their specialty is more for negotiating contracts with carriers and maintaining carrier relationship management programs to manage your supply chain at the lowest cost. Since they are non-asset based, they don’t have to utilize an inventory of assets to remain profitable and are generally more flexible. Even though clients work closer with a non-asset based 3PL provider, the execution of it is all up to the provider in the end. One of the disadvantages of working with a non-asset based logistics provider is that they may find difficulty in finding cost effective solutions.

At US Cargo Link, we are an asset-based logistics provider meaning we own all the assets necessary to run a client’s supply chain. These could include trucks, warehouse, distribution centers, etc. A well-established asset-based 3PL company should be able to lower the expense of moving and sorting goods for their clients. However, because this type of 3PL has made investments in their physical assets, they are somewhat attached and obligated to use those assets when devising ways to manage logistics. This limits options for customization and flexibility. In terms of hard costs of procurement, most of the time asset-based 3PL service providers offer lower costs on warehousing and transportation because they are not paying a third party and are setting their own prices.

We take pride in servicing our customers by providing solutions that addresses every unique concern in a project. We offer competitively low prices, end-to-end solutions for your supply chain, and one-on-one attention for every client– large or small. Contact us today to see how we can fulfill your logistic needs!

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