In a Tight Capacity Crunch, Use These 5 Tips to Get the Most Out of an LTL Volume Freight
Who doesn't like saving money on freight? And we are not talking about saving to prosperity or beating up carriers or 3PLs until you find the lowest quote of the day. In today's marketplace no matter where, what or how you do your shipping, logistics professionals are under pressure to reduce transportation costs. With rising fuel costs and (currently) MAJOR full truckload reduced capacity how can you find savings? Your less than truckload (LTL) rates are generally fixed contract rates, whether you have a direct relationship with the carrier or a 3rd party logistics provider. If you are shipping full truckload the price is always going to be volatile depending on how close you are to the end of the month, seasonal capacity, the given lane and current fuel rate. If you have a solid shopping list with a few brokers in place for your truckload needs you will usually find a decent rate. But how do you manage those in between shipments over LTL and under full truckload, that we call "volume freight"? Well, we're going to give you 5 tips on how to shop, so you can impress your boss and improve the bottom line.
5 Ways to Get the Most out Of Your LTL Volume Freight
1. Know Your Dimensions
Volume freight quotes are considered anything greater than five pallets and/or over 5,000 lbs. of freight, but usually no greater at the top end of 24 pallets or 40 linear feet. Volume freight quotes are determined by how much linear space your freight takes up in the trailer, so it's imperative that you or your customer know if the freight is standard pallets (40"x 48") or what the true size is so you can get a quick and accurate quote from the carrier. This is one time that freight class is not as important as the actual real space you are using on the trailer.
2. Shop Consolidators or 3PLs That Work With Consolidators
Consolidators are non-traditional LTL carriers. Consolidators charge by pallet space and/or linear feet. The pros of a consolidator is that they are a low-cost long-haul carrier and with minimal handling of freight because it all stays on the same trailer from dock to dock. The down side is that they only typically service long-haul lanes, have no access to lift-gates and can be a little slower because they won't ship out until the trailer is full. So if transit time is not a major concern consolidators are a great option.
3. Know Your Lanes
Consolidators typically only operate out of major cities that are important logistics hubs. You can find niche carriers in smaller markets, but they are usually lane specific. The best cities to find value options for consolidators are out of Los Angeles, Dallas, Chicago, Atlanta, and New York.
You are paying for the space on the floor, not the ceiling, so don't be afraid to stack those pallets high. As long as there is no issue with stacking your product, try to get your pallets all the way up to 8 feet high. Over the course of the months and year you will save a lot of money and not waste space when arranging your freight in these volume freight moves.
5. Don't be a Chronic Quoter
Lastly, don't be that person that puts out an email with 25 people on your shopping list. There is real value in having a good relationship with your carrier or 3PL. In fact, we've talked about collaboration at length here between shippers and carriers (and even have talked about "Radical" collaboration). Shippers who quote all the time but never reward the carriers with any freight can get blacklisted or develop a bad reputation among carriers. Eventually they'll quote you very high until you go away or won't work with you at all. The best practice is to develop a real business relationship with your carriers by knowing better how they handle your freight. Either develop an internal system to grade carriers and each quarter talk about the results, or hire a 3PL who can offer you a transportation management system which offers you the ability to easily run reports based on the carriers you've chosen.
We have given you some valuable tips on shopping and shipping for volume freight. If you choose the right carriers or logistics service providers, they will find creative new ways to not only save you money as you ship, but truly give you a total savings over the long term by bringing true value to your organization.
For more tips on how to better manager freight, make sure you set up a logistics consultation with a Cerasis Account Executive or sign up to get a free demo of our TMS, the Cerasis Rater.