LTL is an efficient and cost-effective way to ship — if you avoid these common blunders and get the most out of it
LTL is on the rise, and it’s easy to see why. This economical, efficient shipping method is ideal for businesses that need to use a trailer but don’t require all the space — and expense — that involves. Even amidst the COVID-19 pandemic, LTL remains a popular choice, especially for online retailers and other emerging e-commerce businesses. Industries across the map that ship about $1M per year can use LTL to scale back their logistics budgets while offering customers a cost-efficient and fast way to receive products.
However, the popularity of LTL comes with some caveats. Carriers are capitalizing on elevated LTL demand by adapting their own models to deliver what the market wants. In many cases, this comes with some unexpected costs — both literal and figurative. Errors can be made by both the business and the carrier when it comes to navigating LTL shipping, and these errors can cost you time, money and reputation.
In this article, we’ll lay out common LTL mistakes made by both those seeking the service and those offering it:
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Paying too high a minimum charge
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Mischaracterized freight class
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Overlooked fees
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Incorrect information
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Not asking for a discount
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Base rates
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Subpar packaging
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Poorly estimated weights
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Being afraid to ask for help from a logistics expert
1. Paying too high a minimum charge
When a business opts for LTL, the contract with the carrier will include information about a minimum charge. This is designed to allow the carrier to make a profit when dealing with businesses that do not require FTL. Pay close attention to this minimum charge; it is the lowest possible rate you will pay on your LTL shipment. In a competitive logistics market, there is no need to overpay for this, especially if you’re not shipping large volumes.
2. Mischaracterized freight class
Occasionally — or, with the wrong carrier, often — a freight class is mischaracterized. This can occur due to lack of knowledge about freight classification, lack of tools or lack of time. Whatever the reason for this error, the result is delay and higher fees, especially when dealing with international shipments.
3. Overlooked fees
What services are associated with LTL? What services does your business actually need? These are questions to ask when choosing a carrier for LTL shipping. Examine the contract for associated fees, including fuel surcharges and lift gate services. Look for clauses that seem superfluous and missing items that could incur a fee at a later date.
4. Incorrect information
Thanks to automated technology, incorrect labeling information is less of an issue — at least it should be. Whether it’s an error with an address, classification, product description or some other clerical mistake in the paperwork, incorrect information will result in surcharges, delays, lost shipments and damage to your brand reputation.
5. Not asking for a discount
In the competitive landscape of logistics, it never hurts to ask for a discount. This is especially true for first-time customers. Remember carriers should be working to win your business. Ask about discounts on base rates and compare prices before committing. Failure to do so could cost you money.
6. Base rates
All carriers work from a base rate tariff. Each carrier has their own base rates, and there are other base rates also available to shippers. Base rates change each year; however, carriers are willing to use older base rate tariffs even if they are not their own in-house tariff. Obviously, more current base rates are higher than older base rates, but it all comes down to the discounts that are offered. An 80% discount may sound attractive, but if it is on a newer base rate tariff, a 75% discount may be better off of an older tariff. The base rates depend upon the origin three- or five-digit zip to the destination three- or five-digit zip.
7. Subpar packaging
Packaging is everything, no matter what the industry is. A product should arrive not only on time, but intact. In the complex world of logistics, packaging is so much more than just placing the product into a box, taping it shut and sending it off.
Consider how often shipments are handled during LTL shipping. These items are loaded onto pallets and placed into a shared space with other shipments. Packaging items with quality materials that are suitable for that individual product is always sound advice, but it’s especially crucial in the world of LTL, where your shipments will be handled more frequently.
8. Poorly estimated weights
Guessing on weight, size and dimension is a shockingly common practice. Even a slight miscalculation can drastically change your shipping options and result in reclassifying shipments. This translates to fees, delays and headaches all around.
9. Being afraid to ask for help from the experts
Whether you’re choosing an LTL carrier for the first time, auditing a contract or reevaluating your logistics spend, it pays to get help from an expert. Resource Logistics Group is your ally in the often-fraught process of LTL shipping. Our trusted experts will help you demystify contract language, choose the right shipping partners and select shipping options that save you time and money — all while allowing you to maintain control over your operation.
If you have questions about LTL shipping and are eager to start saving money contact Resource Logistics Group today.
