October 3, 2011 by Frank Peditto
In the transportation industry,
there are two primary types of companies, asset based and non-asset based. Asset
based companies are those that own their own equipment. For example, in the
niche of vehicle transportation, asset based companies own their own trucks and
their driver’s work for the parent company. All of the operations are typically
centralized through one primary dispatch. On the flip side are the non-asset
based companies, of which ReloTrans® is one. Typically referred to as ‘brokers’, non-asset based
companies do not own any of their own equipment, but rather partner with
numerous carriers nationwide and even internationally.
From a service perspective, asset based providers
may offer customers lower rates as they own their own equipment and, as such, sometimes
have more flexibility in pricing, especially if they have a driver needing to
get from one location to another and a customer with a parallel need. Some may
argue that asset based providers also have more control over the service
quality being that their drivers are employees of their company.
Non-asset based companies rely on their network
or database of providers, which allows them to be 100 percent customer focused
when selecting a carrier and driver for their customer. In many cases, they are
also able to obtain bids from multiple providers, all of the same quality, to
ensure that the customer receives the lowest possible cost. They are not
limited by physical equipment or ‘assets’ and their capabilities are scalable
based on the number of partners in their network.
While both types of companies have advantages
and disadvantages, our recommendation to customers is to select the company
that best meets their needs, not only in terms of the physical transportation
of goods or vehicles, but also in terms of their business needs in reporting,
communications and technology services. In this business it’s often said that,
‘you are only as good as your last move,’ and in today’s competitive landscape
that is even more true.