Shipping LTL Freight – 3 Ways to Beat the System
In a perfect world, every shipper would have their own fleet of full trucks delivering their goods to millions of customers across the USA. Unfortunately, the perfect the supply chain world exists for about 1 percent of all shippers. For the other 99 percent, LTL freight or less than truckload shipments come into play. While LTL carriers are plenty, there are just as many hurdles that can cause headaches, waste money, and lead to lost business if a shipper isn’t prepared to beat the system.
Fortunately, there are a few secret tips that LTL carriers don’t like to talk about that will help a shipper save money, ensure timely delivery, and take care of your customers – all at the same time. Here are three ways to beat the LTL Freight system.
Understand When LTL Freight Shipping is Needed
In that perfect world we mentioned above it was quite clear that shipping via a full truckload or FTL is the most efficient method. It’s rather simple to understand this logic, as fewer individual shipments will naturally reduce logistics costs. However, waiting for enough product to be ordered to fill a complete truckload can reduce your ability to service customers on a timely basis. This is why understanding when to use LTL Freight is the first way to beat the system.
There are a few important factors that should help you determine if an LTL shipment is justified:
• What is the carriers final destination in relation to your stop? Quite often, the leading cause of increased or inflated LTL freight costs is the discrepancy or extended distance between your freight’s ending point and the carriers. If the carrier is shipping locally, you can save money on an LTL shipment.
• How quickly does your customer need the shipment? If you have a priority shipment that needs to arrive to a customer quickly, then customer service should always justify the additional cost of LTL freight. If you have extra time, there are several ways to save some money (which we’ll mention below).
• What’s the size of your shipment? Size matters in logistics. However, when it comes to saving money on LTL, sometimes bigger is better.
In most instances, LTL is designed for multiple-volume stops in a short distance or generally local delivery. The three items above will generally lead to a solid “YES” when it comes to determining if LTL Freight is the right option.
Always Use Multiple Carriers
The smart logistics provider understands the value of maintaining relationships, especially with multiple carriers. This is especially true when it comes to choosing an LTL carrier. When you’ve created and established solid relationships with multiple LTL freight carriers, your ability to negotiate tariffs, surcharges, rates, and availability is significantly improved. It is often believed that an LTL carrier holds the ‘buying power’, especially due to the last-minute or rushed nature of most LTL shipments. But this is not always true. In fact, shippers can often find smaller carriers who serve local regions that will provide them with more competitive rates. Sometimes simply gaining a written estimate from one carrier is enough to cause another one to budget.
Have a Solid Understanding of Dimensions and Weights
DIM weights are being used in LTL shipment more than ever. If you’re not familiar with this type of measurement, essentially it factors the size along with the weight of the freight, to determine the most ‘fair’ and ‘accurate’ shipping rate. The problem is that ‘fair’ and ‘accurate’ are typically beneficial to the LTL carrier – and not the shipper. This is why it’s critical to understand what measurements and weights are best for LTL.
In most instances, weights from 150 to 20,000-pounds are best for an LTL shipment. There are several carriers who will provide price breaks for every 100 pounds. Other carriers will offer weight breaks for size (like large pallets or flats that take up empty space). The golden rule of LTL freight with weight is the heavier the better.
Navigating the LTL freight world can be complex, frustrating, and time consuming. Working with an experienced 3PL or third-party logistics provider can significantly reduce the hurdles and struggles that many shippers experience with LTL. An experienced 3PL has relationships with hundreds of LTL carriers, understand all the best practices, and finds creative ways of not only saving their clients money but ensuring on-time delivery of their LTL freight shipments.