TIA President Expects Growth In 3PL Industry

Transportation Intermediaries Association (TIA) President and CEO Robert Voltmann expects to see technology play a role in the continued growth of the third-party logistics industry (3PL).

Voltmann recently sat down with FreightWaves CEO Craig Fuller to discuss the current trends of the $200 billion 3PL industry as part of the FreightWaves.TV show, "Fuller Speed Ahead."

Freight brokers help move the nation's freight from Point A to Point B, however, they don't operate a fleet of trucks. Instead, they utilize technology. 

"The [3PL] industry has always been tech-savvy. The industry has always been the tech adopters and adapters," said Voltmann.

What draws people to freight brokerages is the potential to save time and money. Outsourcing can eliminate the need for companies to hire whole transportation departments and provide better scalability. All a freight broker needs is a laptop and phone, no office required.

Less than 10% of freight is moved through brokers, but the industry has provided both carriers and shippers with the ability to take advantage of freight market changes. 

"What makes a 3PL model different is that they're so attuned to their costs and they can see every single transaction," Voltmann said.

Voltmann expects to see continuous growth in the 3PL industry but also predicts market consolidation over the course of the next decade.

"It's not going to be wholesale consolidation with people being wiped out, but there will be consolidation," Voltmann said.

Voltmann expects to see companies only serving shippers of their size, meaning the biggest companies only dealing with the biggest shippers.

The growth of the 3PL industry has been reliant on the development of new technology for the past 40 years. Voltmann predicts that new technologies, such as autonomous trucking, would revolutionize not just 3PLs, but everyone in the entire trucking industry.

"If trucks become robots, I think it's an earth-altering event for both the asset side and the 3PL side," said Voltmann.

Voltmann believes getting there will require massive changes to how our society travels, automating not just commercials trucks, but passenger vehicles, too.

"Eighty percent of truck accidents are caused by four-wheeled vehicles around them," he said. 

"I think what we're going to see is more automation in trucks, more driver assist, lane-keeping, adaptive cruise control, the same thing we now have in cars," predicted Voltmann on what he expects to see on the road in the near future.

"I think we are 30 years from fully autonomous, drive anywhere, go anywhere trucks without drivers, Voltmann added.

Changing the country's entire highway infrastructure was also a concern of Voltmann. He added that, with all this talk of automation, people tend to forget that autonomous transportation already exists with the extensive collection of railroads in the United States.

TIA has been helping 3PLs grow for over 40 years. With over 1,800 members, TIA represents 70% of the marketplace by value. Members are primarily truck brokers, but they also represent those in the intermodal, air and sea freight industries, too.

"We're helping our member companies be more efficient, understanding their cost through benchmarking and data, and then automating what they can automate," Voltmann said.

Members have access to a number of TIA's assets, including TIA Model Contracts and Frameworks, which protect businesses from legal hardships and help promote better business practices. TIA also provides employee training and company advocacy for its members.

"We really focus on helping them run their business and helping them remain as profitable as they can be," he said on  TIA member benefits.

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