U.S. e-commerce revenue is about $423.3 billion and is steadily climbing. Whether it’s full truckload, less-than-truckload (LTL), or parcel, carriers are being forced to adjust to changes in the retail industry. With all of these changes being implemented at such a rapid rate, it’s only natural for people to make mistakes when working on LTL shipping arrangements. But with some quick insight, you can prevent these mistakes and improve LTL shipping efficiency. Without further ado, here are just a few mistakes you don’t want to make with LTL shipping.
According to the U.S. Department of Transportation, the value of freight moved is expected to increase from $882 per ton in 2007 to $1,377 per ton in 2040. And when bidding out your LTL freight, the first course of action is typically to shop around for the best carrier. While rates are sure to vary based on factors like lanes and commodities, it’s easy to get carried away and focus on the rates alone. But when you’re vetting through potential carriers, make sure to take other factors into consideration, such as customer service, technological expertise and resources, performance and accountability, accessorial charges, and overall flexibility. Weigh these factors carefully before choosing the right carrier.
Trucks carry the largest share of freight by value, tons, and ton-miles for shipments moving 750 or fewer miles. Rail, on the other hand, is the dominant mode by tons and ton-miles for shipments moved from 750 to 2,000 miles. That’s why you’ll have to make sure to take more than price into consideration when negotiating your contract. Once you’ve settled on a carrier and need to sign a contract, you should also look at other financial inclusions: there are likely to be base rates or tariffs, accessorial charges, fuel charges, general discounts, load board integration, and FAK, otherwise known as ‘freight all kind.’ Make sure you’re aware of the financial details and potential discrepancies of your contract and do your best to work them out.
Ultimately, the LTL market is estimated at approximately $35 billion. Understanding these mistakes is the key to maximizing efficiency across all operations. For more information about LTL shipments or load board integration, contact 3PL Systems.