Working in the 3PL world, some people envy LTL coordinators, because they think they’re sitting on easy street with a fleet of trucks always ready for their freight. Others – specifically the people actually working in LTL – know better. LTL is a wild west of quoting freight, coordinating deliveries, tracking drivers, and praying for the best.
With full-truckload, once you find a truck for your load, you’re pretty much olly-olly-oxen-free. The pallets get stuffed into a trailer, and the driver doesn’t even look at the load until it reaches the final destination. With LTL carriers like Saia, Southeastern, AAA Cooper, Old Dominion, and more, you’re not always so lucky.
The World of LTL Shipping
If you’re not familiar with the world of LTL shipping, here’s how it works. Drivers pick up and deliver freight all over a certain area. In the morning, they empty their trucks, then in the afternoon they fill them back up with smaller loads from all over. They return their full truck to an LTL station, where the freight is loaded on a dock and distributed to different trucks. Those trucks then carry the freight in different directions based on the carrier’s normal distribution routes. Usually LTL carriers have trucks that run the same route every night – for example Atlanta to Knoxville and back again.
The ease of LTL carriers is their appeal, and they’re also more affordable if you’re shipping anything less than about half a truckload. The problem is that, because they’re more hands-on with the freight, they’re more picky about what they ship. That’s because certain things are more prone to damage in the process of loading and unloading the freight onto docks, back onto trucks, and onto docks again. That’s where freight classes come from.
Freight Classes and Their Challenges
Freight classes are how LTL carriers determine how much to charge for certain shipments. Freight classes start low – 50 for dense, heavy, non-breakable stuff – then they go up to 500 for really light, flimsy, and easily damaged stuff. Freight classified at 50 will be cheaper per pound to ship than stuff classified at 300.
The really frustrating thing about freight classes is that they’re not the easiest thing to figure out. Ultimately, the freight carrier decides how to classify the freight, and they can take certain liberties in reclassifying the freight after it’s already picked up. For example, you might think that a pallet of lumber is freight class 50, but then Saia picks it up and determines your pallet is actually freight class 100. If that happens, the cost goes way up. If you’re a 3PL, you’ll be on the hook for lost margin, unless you want to really upset your client by telling them you quoted their freight wrong.
If you want to keep your clients, that’s probably not an option, meaning it’s in your best financial and business interest to make sure you’re classifying freight correctly on the front end. Here are three tips to help prevent financial losses when shipping LTL, specific to freight classes:
1. If You’re Not Sure, Estimate High
The problem with freight classes is that the same type of item (e.g. lumber) can be anywhere from freight class 50 to 150. That means you have to use your best judgment on your shipments. My advice: build in extra margin in case the shipment gets reclassified or just quote using a higher freight class. It’s really the only option to make sure you don’t get bitten financially by the reclassification bug.
2. Get Your Quotes in Writing, Including Freight Contents
If you’re quoting a shipment, and your client says they’re shipping a pallet of bricks, and you quote the shipment as a pallet of bricks, you’ll want to make sure that’s in writing. The last thing you want is for the LTL carrier to pick up the pallet, and it’s actually filled with stuffed animals classified at 400. Your costs in that difference are going to skyrocket, and if you don’t have your quote with contents in writing, you’ll probably be left holding the bag if the freight gets reclassified.
3. Communicate With Your Client
The worst thing you can do in freight is make bad assumptions and not communicate. Knowing your client’s business and having an open line of communication is the best way to make sure you’re quoting your shipments competitively and not getting hit with LTL reclassifications that eat into your profits. Talking to your clients, being up front and honest, and ensuring neither of you run into surprises is the best course of action.
LTL freight shipping has its positives. Unless you live in the boonies, you know that it won’t be a problem getting your freight picked up the same day and shipped basically anywhere in the world. On the flip side, the LTL carriers have a decent amount of leverage when it comes to classifying freight. Make sure you’re checking the freight class of every shipment, and if there’s any ambiguity in what you’re shipping, always bake in some extra wiggle room in the margin of your quote. It’ll save both you and your clients a world of hurt and a bunch of headaches down the line.
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