Tag: manage your supply chain

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.

Four Of The Most Common Answers In LTL Shipping

In shipping there are many more questions than answers.  Freight carriers involved in less than truckload shipping are a unique entity in the shipping equation.  Below you will find the answers to the top five questions asked about LTL shipping.

What is less than truckload (LTL) shipping exactly?

When shipping a load that consists of freight that takes up less than a full truckload it will be less expensive for freight to be sent LTL.  In shipping there are there are three main shipping modes, less than truckload, parcel carriers and full truckload carriers.  Parcel carriers usually handle smaller packages and freight that is broken down into units that are less than one hundred fifty pounds.  Full truckload carriers move freight that consists of a load fitting into a semi-trailer.  Semi-trailers are between twenty six and fifty three feet.  They require a large amount of freight to make it cost effective for shippers to choose this option in freight shipping.

How exactly do LTL shippers operate?

An LTL shipper usually carries a load of freight between one hundred and fifty one pounds and twenty thousand pounds.  Most LTL carriers work through a hub and spoke system.  This allows smaller shipments to be sent through a variety of channels and paired with other shipments headed to the same place to create a full truckload.  This keeps the costs down and allows for many smaller shipments to get where they need to be without the expense of a full truckload shipment. Many small picks ups can occur, creating smaller shipments, centered in one local hub shipped out through a variety of spokes to other LTL carriers at a lower cost to shippers.

What is the advantage of using a carrier that ships LTL?

The major advantage of using an LTL carrier is that you can decrease the costs associated with transportation on your freight shipments.  Also, additional services are offered through LTL carriers such as lift gate services at pickup and delivery, residential services, indoor deliveries, notification of pickups and deliveries, freeze protection and more.  If you need a more hands on approach to your shipment it is ideal for you to look at LTL carriers for transporting your goods.

What is the main difference between the operations of LTL shippers and parcel carriers?

Parcel carriers usually ship pieces that weigh less than one hundred and fifty pounds.  LTL carriers and parcel carriers still compete for shippers as larger shipments can be broke down into smaller packages.  An LTL carrier prefers to ship loads that don’t need a great deal of handling.  An LTL carrier prefers to ship pallets.  LTL shipper ship one pallet which may contain many boxes wrapped together to form one shipment where as a parcel carrier will break it down into smaller loads.   The typical per pound rate of LTL carriers is less than the per pound rate of parcel carriers overall.

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

Freight Shipping Methods Used In Less Than Truckload Shipping

It is important that you choose a freight company that meets your needs when you are shipping larger items. Less than truckload shipping is a popular option within the freight industry. There are several methods used to ship freight. The one that you choose will depend on a few things such as what you are shipping, when it needs to arrive, if it’s perishable or fragile. Below you will find each method used within the industry. When you are choosing a freight carrier you can choose one or more methods of getting your LTL shipment where it needs to be when it needs to be there.

Options for Shipping Freight

Shipping By Road: Trucks are used for large items that can fit into a transport vehicle. This method is most often used when travel from one location to another is convenient. It is however, one of the slowest methods in shipping so time should not be a factor when shipping by road.

Shipping By Rail: When you have a large cargo shipment that does not fit into a transport vehicle railway is the way to go. Rail is a quick method of shipping large cargo items. When there is a time crunch rail is one of the best shipping methods. Rail is most often used for shipping vehicles, manufacturing goods, equipment and farm supplies.

Shipping By Sea: Shipping by sea is one of the most cost effective ways to send large shipments. It is also one of the slowest; it takes a lot longer to ship an item via sea over other options in shipping. Larger vehicles, industrial vehicles, heavy machinery, manufacturing vehicles and more are shipped by sea.

Shipping By Air: Using an airplane to ship is another option. This method is used to get goods to remote locations, when there are no time constraints, there are no roads or routes to the location or your shipment needs to go to another country.

Consider the type of shipment you are sending as well. If you are shipping perishable items or hazardous items you will want to be sure the carrier you select is equipped to handle it. Some companies will not ship these items that need to be handled with special care.

You will also want to look into the companies shipping track record when choosing a shipper. Make sure they are reliable, honest and have a solid customer service record. Also check to the carrier’s damage history. Carriers that offer 24/7 support is preferred over those that are only offer support during normal business hours.

The shipping rates and transportation methods carriers’ use are important as well. LTL freight shipping can be complex but when you take your time to understand the process and research freight carriers you will come out on top.

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

Freight Pricing Simplified

Freight pricing is a bit confusing especially when it comes to less than truckload companies. LTL companies use a variety of methods to determine the price to charge for your shipment. The most common way this is done is using freight class. Rules and guidelines are in place for the trucking industry to use to determine the classification of shipments. This directly affects how much you pay to ship an item.

Not only does the classification on your shipment affect how much you pay so does the shipments density. Density is calculated by determining how many pounds per cubic foot your shipment is. This allows the carrier to figure out how many other shipments can also be put on the truck. Less than truckload companies load several LTL shipments onto one truck to make a full trailer. The lower the classification of your shipment the less it will cost to ship.

Another factor that helps determine what you are charged is the items likelihood to be damaged. Fragile items or items with a lot of bulk fall into freight classes between one hundred twenty five to five hundred and account for most expensive shipments. Your service provider is knowledgeable in these differences and will assist you in figuring out the freight class charge of your shipments.

Some brokers are granted “Freight All Kinds” pricing with certain carriers that they contract with for LTL shipping. This means that higher classed items are shipped at lower cost classification. The only way an individual shipper can benefit from this is to ship though a broker such as those you can find online. Trucking companies do not offer direct discounts to private individuals.

Shipping a full truckload is usually calculated by mileage. The company figures in all the factors such as operating costs per mile as well as a markup that adds up to the amount you pay. You will realize bigger logistics savings when working with a freight broker. Brokers work with many trucking companies and can instantly shop for the best price to send your shipment. Freight brokers can always work out a better deal than you can as a private shipper. Dealing directly with shippers is more expensive by upwards of fifty to eighty five percent over what brokers can negotiate. The most private shippers can negotiate is usually five percent.

When choosing a broker to work with to handle your shipments look for other qualities other than a low price. Find a broker that only works with trucking companies that have the same customer service values as you do. Work only with freight who work with shippers that value on time shipments and consistent quality service.

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 Logistics Partner Part 2

Accessing a new freight broker or shopping for one initially often comes with some confusion.  Every freight broker works a bit differently, no two are the same.  There are several things to consider in your quest to find a perfect match with your business philosophy.  We will look in depth at questions to use when you are interviewing freight brokers.  Remember that the freight broker you choose will be an integral part of your business success; your goal is to find a dependable company to work that has the same customer service philosophy as you do.

How do they select their carriers?

Just like you have to research a freight broker they have to investigate carriers to work with.  You need to ask about the selection criteria they use to choose carriers for shipping your freight.  They should be concerned with the carrier’s safety records, reputation within the industry, length of time they have been in business, the age of their equipment fleet and the number of trucks and drivers they have.  Their carriers are about to become your LTL freight shippers.

How are their communication skills?

You need to choose a freight broker that works with carriers that will represent your company and product as if you were hand delivering it.  The carrier’s dispatchers will be working directly with your clients on status updates, delivery notices and ensuring that the shipment arrives where it should and in the condition it was promised.  How well the broker communicates with you is a solid indicator of how well communication runs throughout their operation.

How good is their billing department?

This may not seem super important to you but in reality is a key aspect of logistic organization.  Find a freight broker that offers accurate, detailed and timely billing.  This is important to your business as many times the cost of shipping can be passed off to your customers.  Inaccurate billing on the part of the freight broker in turn leads to billing errors to your customers, thus throwing off the finances within your logistic department.

Ask them to provide references?

Check out the freight brokers references.  Meet with references that manufacture and ship similar goods to what you offer in the same areas that you ship too.  This will give you a complete idea of what you can expect from them.  Talk in depth about recent performance, including issues and how they have been handled.

There is a lot to consider when choosing a broker to handle your LTL freight services.  Follow your instincts.  The cost of their services should not be the only reason to hire or not hire a freight shipping broker as good customer services is often worth some extra pennies here and there.

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

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.

Exactly What Is LTL Shipping and Is It Right For My Business

Shipping cargo is something most businesses will have to do at one time or another.  The sea of options that are available when it comes to shipping makes it difficult to choose one.  How can you ensure that you are choosing the right company for your shipping needs?  Not all shippers will be right for you and your particular shipping situation.  If you are looking to ship a lot of items, or a few large items cheaply but don’t have enough to fill an entire truck your best option is to use an LTL trucking company, otherwise known as less than truckload.

Less than truckload shipping is for cargo that weighs between one hundred and fifty one pounds and twenty thousand pounds.  It is an option for small businesses that don’t have enough shipments to fill an entire truck but are tired of paying the high cost of Parcel Post.  LTL shippers take multiple small loads to create one full truckload.  This allows them to charge less than companies that ship parcels separately.  They fill an entire truck to in order to save money and maximize their profits whereas you are only paying for your share of the truck that is being used.

An example of this is if your shipment only fills a quarter of the truck you pay for that portion of the truck.  Then the rest of the truck is packed with orders from other companies to fill it completely.  Each company only pays for the amount of the truck that their shipments are taking up.

Even though LTL shipping can handle shipment upwards of twenty thousand pounds the ideal shipments will weigh around one hundred to ten thousand pounds.  When shipments weigh over one hundred pounds is when they become too expensive and too heavy to ship Parcel Post.  At around ten thousand pounds the expense of LTL shipping gets close to that of full truck load shipping at twenty thousand pounds.  These are things to consider depending on if you will have more shipments and you can hold off until they are ready to lessen the overall expense of your shipping needs.

Most local shipping companies offer less than truckload shipping options.  In order to find one that meets your needs shop around and research your options.  Find a company that is based around customer service, a solid reputation, availability and lastly price.  If a company is cheap but unreliable and falls short on customer service you are not better off in the long run.

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