The Difference Between Shipping and Logistics and How To Optimize Both

Published on
Nov 30, 2022
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What's the biggest driver of growth for your business? Depending on who you ask, you’ll likely get a different answer. After all, marketing brings in the leads. Sales gets the contract signed. And customer service is definitely important for long-term loyalty. But there is one essential growth driver that is often overlooked: shipping logistics.If you deal with shipping any product, you know the importance of getting it to your customer on time and damage-free. And you know that is only becoming more difficult—markets are changing, supply chains are getting longer, and competition is fierce. That's all the more reason to learn how you can optimize your shipments using the right logistics technology and strategies.

What is shipping vs logistics?

definitions and examples of shipping vs logistics

The definition of shipping is as straightforward as you might think: It means transferring goods or materials between two locations, for example from a factory to a warehouse or from a warehouse to a distribution center. There are many different types of shipping that may require different documentation, handling, and so on—like hazmat shipping or international shipping. But the definition of shipping always comes down to the process of physically moving goods through the supply chain.Logistics is a broader term that refers to how you manage processes and procedures within your organization. For businesses that make tangible goods, logistics includes all of the processes that need to happen to fulfill orders, including making, storing, and transporting your product. Shipping is one of these processes. Others might include sourcing materials, producing, packaging, warehousing, and managing inventory. While all shipping procedures fall under the category of logistics, not all logistics fall under the category of shipping. Most businesses find that they need both to work in harmony in order to manage their supply chain, create happy customers, and grow their business. Many turn to logistics shipping companies for help, but that isn’t always the best answer.

What is shipping logistics?

Shipping logistics is one component of the overall logistics system you need to have in place to manage your freight and fulfill customer orders. It’s the management of the specific processes involved in successfully getting your goods from point A to point B. There are three main types of shipping logistics:

  1. Inbound relates to receiving goods from providers—either receiving the raw materials to create your product or receiving products themselves.
  2. Outbound relates to delivering goods to the customer. It includes packing, determining freight class, securing carriers, scheduling and tracking freight.
  3. Reverse deals with receiving returned goods and shipping a new item if necessary.

Each type can have effects further down the supply chain. If your outbound logistics result in a lot of damaged products, for example, you may have more returned goods—affecting your reverse logistics.Shipping logistics is sometimes used interchangeably with freight logistics, but like the discussion of shipping versus logistics, there are some differences. Shipping refers to any amount of goods, while freight typically refers to bulk goods in larger quantities.

Optimizing freight logistics with Flock

Managing outbound logistics comes with its fair share of challenges—from determining the right type of freight shipping, like TL or LTL, and contracting with logistics carriers, to scheduling shipments and ensuring they arrive on time and in good condition. Luckily, Flock Freight can help.

Reduce freight costs

Unfortunately, businesses can’t control market conditions—and that’s what determines freight costs. At the beginning of 2022, our Drive Research Study on inefficiencies breaking the supply chain found that contract rates were up and many LTL shippers were being forced to pay for other modes due to shrinking size requirements. This meant they either waited for their trucks to fill up or paid to ship air. And it isn't all about shipping rates. Accessorial fees also add up—on average, LTL shippers paid $411,239 in accessorial fees in 2021.Flock Freight offers flexibility and optionality to help you keep costs down. We let you choose any freight mode—such as truckload, traditional LTL, or shared truckload (STL)—to fit your load instead of being locked in to one type of freight. And when you share truckloads, you'll enjoy 20% cheaper fares than TL, and your rate won't change due to reweighs, reclassification, or other common accessorials.

“We use Flock Freight to reduce our costs and improve service with shared truckload.”

– Todd Birman, Senior Manager of Domestic Transportation, Berlin Packaging

Reduce shipping delays

Businesses today are seeing the “Amazon effect” everywhere they look. Customers expect fast, reliable, and inexpensive shipping logistics—period. But traditional less-than-truckload models can be less than dependable, relying on hub, spokes, and terminals. According to our survey of 200 shippers, 100% of LTL shippers reported that their LTL freight arrived late in 2021, with some shipments arriving as many as five to six days late. Unlike traditional LTL logistics shipping companies, Flock Freight’s optimized STL routes are terminal free, which means fewer delays. When you pool freight in a shared truckload, we won't zigzag your freight to places it doesn't need to go. That's why we have 30% more on-time deliveries than standard LTL. On-time deliveries equal happy customers—and happy customers can equal business growth.

“In December [2020], FlockDirect®'s on-time percentage was 97%, compared to that of LTL, which was only 83%.”

– Tyler Wright, Logistics and Operations Manager, Waiākea Water

Maintain visibility on shipments

When your goods go out the door, do they disappear until delivery? Lowering costs and improving reliability are just two benefits of effective shipping logistics. Knowing exactly when deliveries will arrive and with a relatively low risk of damage can really improve your customer satisfaction. Traditional LTL models don't always have a great reputation for visibility or damage-free deliveries. Paying for full truckloads improves visibility but increases your costs. What's an LTL shipper to do?Flock Freight’s shared truckload shipments travel via TL carriers, so you gain access to specific, real-time tracking updates. Log in to our platform to know your freight’s exact whereabouts and delivery dates—so you can make more informed, empowered business decisions.

“Other vendors don’t provide a platform that gives transparency.”

– Gabe Anzaruth, Office Manager, H2rOse

Streamline onboarding and support

Shipping logistics managers and directors may not always have full trucks, but they certainly have full plates. Yet established business practices and existing technology don't have to be roadblocks to improving your processes. There’s always room for growth, especially of the sort that can help lower costs and keep customers happy. Flock Freight’s patented technology may be more accessible to your business than a partnership with a shipping logistics company. It easily integrates with your transportation management system (TMS) via API or EDI to streamline your workflows. Once onboarded, you’ll get reliable support from your dedicated representative on everything from quoting to tracking. At Flock, we’re as dedicated to our customers as you are to yours.

“My rep worked beyond general expectation to get through high-pressure, short-turnaround situations that were critical to us closing new distribution partners.”

Thomas Bentley, COO, Spill Tackle

Switch to shared truckload[sc name="anchtag" id="switch-to-stl" ][/sc]

According to our research, 51% of truckloads moved with empty space in 2021. That means more than half the time, you’re paying shipping logistics companies to ship air. It's the status quo, but it doesn't have to be. Flock Freight is the only company offering you shared truckload—which can save you money by sharing space on direct, hubless routes with less damage, less fees, and more predictable deliveries. Learn more about how our tech-driven freight shipping can help you drive up profit while driving down effort.