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Overreliance on Multiple 3PLs Can Inflate Rather Than Cut Freight Costs

Shippers using numerous third-party logistics providers simultaneously may inadvertently drive up transportation rates instead of reducing them, according to John Conrad, Chief Revenue Officer at Evans Transportation Services.

When multiple 3PLs bid competitively on the same lanes, carriers recognize the pattern and delay accepting loads to extract higher rates — a phenomenon Conrad describes as "broker poker." As brokers repeatedly bid on the same lane, carriers strategically wait for better offers, knowing higher rates will eventually materialize.

Conrad cautioned that legitimate reasons exist for engaging multiple 3PLs, but only when pre-existing, trusted relationships already exist within specific business segments. Evans Transportation retains vetted partner 3PLs rather than displacing established relationships.

On broader market conditions, Conrad noted rates remained elevated even during periods of falling fuel prices and climbed again as fuel rebounded. Gulf Coast markets show load-to-truck ratios reaching hundreds-to-one, creating pressure that could intensify with weather disruptions. Open-equipment and heavy-haul segments represent the most volatile modes in the current market.