Basics in Managing your LTL Freight Spending

As less than truck load (LTL) volumes stabilize, LTL carriers continue to look at areas to increase margins.  One of these areas is ensuring shippers pay for the services they receive.   Below are four essential elements you can use to improve control over your LTL transport spending:

•    A bill of lading.  A complete and correct bill of lading to be more precise.  To ensure your carrier can give you the agreed discount at the best possible rate, make sure that not only are the origin and destination listed on the bill of lading, but also the correct account number, cargo description, piece count, weight, freight class, and freight value are listed.   

•    Shipment weight.   Carriers have the right to re-weigh and re-class your cargo.  Unless the weight of your cargo is correct on the bill of lading, your estimated cost can easily increase and add up to a hefty difference between your budget and your actual LTL spending.

•    Packaging.   In the worst case scenario, improper packaging could cause your cargo to be damaged and ruin your chance to file a claim.  In a more common scenario –and many times overlooked- poor packaging will increase your transport cost due to increased volumetric weight, and/or if the carrier has to shrink wrap or repackage your freight in any way to withstand the standard handling and transport conditions.  Note that the issue could sometimes occur the other way around: excessive packaging may also cost you more.

•    Accessorial charges.   If your cargo needs special arrangements such as a lift-gate, dividers, or inside delivery, there is not much you can do about it.  However, you should negotiate these types of service needs at the same time you are negotiating your rates.   Accessorial charges are like ordering a meal off the menu and then continually ordering more side dishes, your restaurant tab will just keep growing.  If you want to manage your cost, strive to cover all your needs from the beginning.

LTL carriers are not in the business of making your life difficult or finding ways to nickel and dime you, but they do need to charge you for services rendered.   To better manage your cost, what you really want is to make it as easy as possible to move your freight.  Give all the information you can to the carrier up front and negotiate your rates and discounts based on this.  Then just make sure your bill of lading is complete and correct, and ensure your cargo is packaged and secured properly.   It may take some work with your own internal teams, but controlling your LTL spending will benefit you in the long run.   Contributor: Amparo Elizondo, Allyn International Americas Logistics Manager, Florida.

If you need help with LTL negotiations, process assessment or packaging consulting, just let us know!  AllynLogisticsConsulting@allynintl.com