Six Factors That Smaller LTL Shippers Need To Consider

In order to avoid being squeezed out by large LTL freight carrier’s small freight carriers must be resourceful.  Smaller LTL companies but consider the factors that follow to provide efficient freight services and compete within the shipping industry with so many large carriers. 

• Transit Time: How fast do shipments need to get to you or to your customers?  Slower transit times are common with long-haul carriers within regional lanes.  Whereas regional and multi-regional carriers tend to produce faster transit times in these lanes but may not provide services in longer haul lanes.

• Geographic Coverage: It is crucial to understand where different carriers deliver. When you understand where carriers offer their services you can optimize which carriers are best suited for the service.  There are many carriers that provide only regionalized direct pickups and delivery services.  Find carriers to work with that provide service to the areas you desire.

• Service Performance: Customer service is incredibly important in shipping. You need vendor shipments to make it to you when you need them and your carriers need to deliver to customers when they are expecting them.  Reliability for most carriers range within the ninety percent range for on time pickup and delivery performance.   Long haul carriers have less reliability than most regional carriers.  Almost all carriers however provide guaranteed delivery services for additional fees. 

• Liability Insurance Coverage: Liability insurance coverage is offered on most shipments.  The price that this coverage will cost is different depending on the carrier, freight classification and if your product is new or used.   Most LTL carriers provide coverage to shippers at a rate of ten dollars per pound.  Best in class coverage is harder to find and tend to be a bit pricier at twenty five dollars per pound.   Some regional carriers offer liability insurance coverage for as low as a dollar per pound. 

• Financial Stability: It is necessary to use carriers that are financially stable. Carriers that are struggling with profitability and debt issues have complications that should be avoided.  It is a risk that can be avoided and should be. With so many LTL carriers it is unnecessary to choose a carrier that is unstable in any element of their business.

• Pricing Factors: When working with different carriers it is crucial to understand the pricing. This is especially important for smaller businesses.  In order to determine the true cost of transportation consider: discounts, base rates, net pricing, minimum charge floors, freight classification, weight, accessorial fees and FAK provisions.

Other things to consider when looking for LTL freight carriers there is almost never one carrier that fits every need you may have.  Work with and established freight broker to do the heavy leg work so that you can focus on what is really important, running your own business.

Jefferson Diversified Group, LLC is a Global Logistics expert offering LTL shipping and more. Check out available rates today at http://www.detroitltl.com.

4 LTL Shipping Tips To Improve Freight Carrier Relationships

Following the rules of less than truckload freight shipping is the most important thing you can do to make sure you maintain a positive relationship between shipper and carrier.  The tips below will help to ensure you continue to improve your relationship with your LTL carriers while helping yourself reduce costs and improve the shipping efficiency of your company.

Don’t Falsify Freight Weight: When it comes to creating a relationship with an LTL carrier one of the biggest mistakes you can make is to falsify the weight of your shipments.  It is important to accurately report all of the cargo’s correct weight.  This information is critical to less than truck load freight carriers as incorrect reporting of weight increases the expenses on their end.  Note that LTL shippers re-weigh eighty percent of their freight as this is the key element to keeping down their expenses and improving their efficiency.

Accurate Bill of Lading:  Decrease the errors in your transportation mananagment system by automating the intergration of your address and commodities books.  Accurate bill of ladings are important for carriers.  LTL carriers are becoming increasing aware of inaccuracies and are working to prevent them.  You can imporve your reputation with your frieght carrier by providign an accurate bill of lading each and everytime you ship a less than truckload shipment.

Lessen or Avoid Accessorial Charges:  Accessorial charges are the fees charged for extras such as residential services, lift gates, set appointment deliveries and more.  In parcel shipping there is a great deal of accessorial charges whereas in LTL shipping there are around fifteen.  When the load capacity is tight many shippers will choose the shipments with less accessorial charges as these are the things that slow the pickup and delivery of shipments.

Properly Packing Your LTL Shipments:  It is important that your shipments are packaged correctly to travel via the mode of transportation chosen by you and the LTL carrier.  If a shipment is not packaged correctly the shipper will have to repack it to prevent damage.  This takes away from the carrier’s efficiency.  If a shipment is packed improperly it can drop off the forklifts when being transferred damaging the contents thus creating more work for both you and the carrier.  This can all be avoided with proper packaging.

By abiding by these simple tips when shipping freight with a LTL carrier you can greatly improve the relationship between you and the carrier.  Following these basic tips will allow you both to improve efficiency and reduce costs.

Jefferson Diversified Group, LLC is a Global Logistics expert offering LTL shipping and more. Check out available rates today at http://www.detroitltl.com.

Understanding LTL Carrier Rates

Seven things to understand about Less Than Truckload carrier rates:

Base Rates:  One of the challenges with purchasing less than truckload freight services is comparing the similarities and differences in costs between different carriers.  Every carrier determines their own base rates which will differ a great deal between carriers and shipping lanes.  A base rate is quoted per one hundred pounds often referred to as centum weight, CWT.  When determining the CWT it is important to understand what it is based on.  CWT takes into consideration the freight classification, the weight of the shipment, the distance travelled, as well as the origination and destination zip codes.

Classification of Freight:  The National Motor Freight Classification, NMFC publishes the different classifications or classes comparing commodities that are moving in interstate, intrastate and foreign commerce.  According to the NMFC there are eighteen different classes that range from fifty to five hundred and are based on the products density, ability to be stowed, handling and liability.  If the freight is a lower class it represents a low risk, dense shipment.  Higher class freight indicates freight that takes up a lot of space and is charged a higher rate.

Freight all Kinds: FAK is an agreement that enables multiple items with different classes to be shipped and billed at the same rate.  This agreement is made specifically between the carrier and customer.   This allows negotiations with the carrier to ship multiple commodities that range in class to ship at a specific rate.  Commodities range in class from one hundred to two hundred that are being shipped are charged at one hundred fifty because of the FAK agreement between the carrier and customer.

Distance: CWT calculations for less than truckload freight also take into consideration the distance the freight needs to travel.  This is a bit trickier as of course the longer the distance the more it will cost to ship.  Some LTL carriers will only service specific regions and if a shipment is sent outside the normal service area the trucking company will transfer the load to another LTL carrier.  This can add to the cost of the shipment.

Weight: With less than truckload shipping you actually pay less per pound the more a shipment weighs.  So a shipment that weighs two hundred and fifty pounds may actually end up costing $1.49 a pound where as a shipment weighing one hundred pounds may cost $2.00 a pound.

Minimums:  With less than truckload carriers there is an absolute minimum charge otherwise known as an AMC.  This is considered the minimum amount that will be charged or the shipment will not go.

Accessorial Charges: The accessorial charges are the fees that are charged for services that go beyond shipping the freight from one point to another.  Examples of these charges are inside pick-up, lift gate services, residential delivery, packing and many other extra services.

Jefferson Diversified Group, LLC is a Global Logistics expert offering LTL shipping and more. Check out available rates today at http://www.detroitltl.com.

Finding A Global Logistic Partner

Whether you are evaluating a new freight broker or shopping for a first it can be hard to assess what you should be looking for.  Every freight broker is different; no one freight company is like the other.  An integral part of your business is the dependability of your freight broker.  In order for success in business your freight broker’s plan of success should be in combination with one another.  Here are some questions to consider when interviewing a freight broker that is new to your business.

Are they licensed and insured?

Recently new laws have been put into place regarding the licenses and insurance that freight brokers carry.  Federal law requires that anyone arranging transportation for compensation has a federal broker license that is issued by the Federal Motor Carrier Safety Administration.  Without at least $75,000 bond as well as the proper authority a freight broker should not be providing arrangements for the transportation of goods.

Have they been in business long?

Avoid working with a freight broker who has been in business less than two years.  Up until this point they are in basic survival mode themselves.  They have not had time to build relationships with carriers and have yet to provide proof of consistent success.  With time freight brokers build history, experience, great communication and personal relationships with their carriers.

Are they multi-modal?

It is important that the broker you work with offer a variety of modes of transportation options to get your good from one place to another.  Using multi-modal transportation brokers can offer business, large or small, the fastest shipping at the best price.  Depending on your needs consider if you need to work with a broker that offers more than nationwide shipping, not everyone needs international shipping but if you do it will be important that your broker works with international freight carriers.

Can you get estimates and shipping rates in writing?

Cheaper is not always better.  All quotes should be in writing.  This allows you to see all the details including accessorial charges on your shipment.  Communicate with your freight broker if charges are not clear.  Don’t be blindsides with duties and taxes, these should be included on the original estimate.  Your written quote should include every charge included in your shipment.

In our next installment on choosing a freight broker we will take a deeper look into how brokers choose carriers, how they bill and all about reviewing their references.

Jefferson Diversified Group, LLC is a Global Logistics expert offering LTL shipping and more. Check out available rates today at http://www.detroitltl.com.

Choosing A LTL Shipper or Shipping Broker

Finding an LTL shipper is a small feat for many businesses.  No matter if you ship a few dozen LTL shipments or a group of pallets monthly you need to find a less than truckload shipper that works within your schedule and budget.  Choosing an LTL Shipper is one of the most important business decisions you will make.  Another way is to choose a shipping broker that will assist you in finding exactly what you need when you need it. Whether searching for an LTL shipper or freight brokers there are a few considerations to make to find someone that will help you build your business.

1)      Work With Those That Will Help You Simplify The LTL Shipping Process

Find an LTL shipper that will works with you to make your shipping as simple as possible.   A company that has your best interest in mind will determine what your requirements are so that no detail is forgotten as your LTL shipments are processed.  The process should be easy for you, every question that needs to be answered should be asked ahead of time in order to ensure the quote you are sent matches exactly what you pay.

2)      Find Companies That Will Help You Save Time

LTL shipping is one of the most complex methods of shipping.  Find a company that will work with you to identify the class of your freight, the weight, routing, rates, packing and documentation.   Work with an LTL shipper or LTL broker that will handle all of this for you so that you can concentrate on your business.

3)      Make Sure You Are Always In The Loop

You want to work with an LTL company or shipping broker that keeps you in the loop when it comes to any and all issues that may affect your business.  If the freight classification changes and it will affect your overall pricing you need to know that the company you are working with will let you know so that you can make changes to your shipping budget.

4)      Saving Money Is Important Too

A LTL shipper or broker should be working to leverage the best deal possible for you shipments.   Work with companies that will offer you discounts and blanket pricing.  A company that is looking to save you money will attempt to combine your shipments to save you shipping dollars. 

5)      Technology Matter

The software and advances in logistics matter when it comes to shipping your products.  Work only with LTL shippers and freight brokers that work with the latest in technology and shipping software.  This will ensure that your needs are met at the best possible rates.

Jefferson Diversified Group, LLC is a Global Logistics expert offering LTL shipping and more. Check out available rates today at http://www.detroitltl.com.