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  7. Third-Party Logistics Provider
Commercial

Third-Party Logistics Provider(3PL)

Definition

A company that provides outsourced logistics and supply chain management services including transportation procurement, freight brokerage, warehousing, and distribution on behalf of shippers. 3PLs frequently negotiate rail contracts and manage intermodal moves for their clients. They add value through scale, expertise, and technology platforms.

Related Terms

Freight Broker

An intermediary licensed by the FMCSA who arranges transportation between shippers and carriers without taking possession of the freight. In the rail context, brokers often coordinate intermodal moves combining truck drayage with rail linehaul. Brokers earn a margin on the rate spread between what shippers pay and what carriers charge.

Shipper

The party that tenders freight to a railroad for transportation, also known as the consignor. The shipper is responsible for proper loading, securing, and documentation of the lading. In rail rate negotiations, the shipper is the primary counterparty to the railroad.

Intermodal Train

A high-priority train carrying intermodal containers or trailers on flatcars, typically operating on expedited schedules to compete with long-haul trucking. Intermodal trains generally run at higher speeds and have priority over manifest trains in most railroad operating plans. They serve as the interface between the rail and trucking networks.

Transportation Management System(TMS)

Enterprise software used by shippers, logistics providers, and railroads to plan, execute, track, and optimize freight transportation. In the rail context, a TMS manages rate procurement, shipment tendering, car ordering, tracking, freight bill auditing, and performance analytics. Modern TMS platforms integrate with railroad EDI systems and provide real-time visibility.

More in Commercial

Commodity RateConsigneeCar TraceShipperRateCaptive Shipper