Know Your Transportation Terms

Transportation seems like a simple concept. It’s about moving products and supplies from Point A to Point B. But there many options to get the job done and knowing the key terms will help you better understand each offering and the industry as a whole.

Take for instance “Transportation Brokerage” and “Managed Transportation.” The two often are used interchangeably, but they are radically different services. Brokerage involves a third party acting as a conduit for a company and the motor carrier to move loads – a very tactical assignment.

Managed Transportation is far more strategic and involves a company outsourcing all transportation functions to a third party. The provider uses detailed analysis and technology to determine the most efficient way of meeting supply chain goals. Managed Transportation is much broader in its scope, looking at a variety of modes as well as warehouse locations.

Other important terms to know include:

• Freight Forwarder. An expert in supply chain management that moves cargo for companies, often utilizing multiple carrier types for a single shipment. Shipments typically travel internationally.

• OTR. Over The Road. Also referred to as TL (Truck Load), these shipments typically travel greater than 350 miles. 

• Shuttle. These are short runs (less than 100 miles) of raw material from a warehouse to a production facility, or finished goods to a warehouse. 

• Regional. Truck loads that travel less than 350 miles within a geographical region. 

• LTL. Less-Than-Truckload. Refers to a shipment that is less than a full truckload. 

• Intermodal. A method of moving freight through multiple modes of transportation, such as rail, ship, and truck. Freight itself is not handled; the shipping container is transferred between the modes. 

• CTB Certified. The Certified Transportation Broker (CTB) program was developed by the Transportation Intermediaries Association. A CTB designation signifies that the professional has undergone rigorous training and testing to ensure they are an expert in the transportation industry.