When it comes to moving small freight, less-than-truckload (LTL) shipping is often the most cost-effective option. But finding the lowest rates for these shipments isn’t always as straightforward as it looks. Requiring more complex contracts and a higher level of specificity than some shippers may be used to, LTL shipments, however small, can come with surprise costs when shippers aren’t prepared.
To make the most of this shipping option, shippers can do some things to optimize their LTL shipments—and bring costs down.
Be aware of accessorial fees.
Depending on the nature of the shipment, some LTL shipments can accrue accessorial fees—as additional charges on the bill of lading. These fees, charged on top of the initial quote from the LTL carrier, can leave unsuspecting shippers paying much more than they initially intended.
Common accessorial fees include:
- Blind fees: when the receiver’s name is not listed on the bill of lading.
- Overlength fees: when freight takes up a lot of space in the trailer.
- Reclassification and reweight fees: when shipment details (like dimensions, weight, and class) are missing or incorrect.
- Sort and segregate fees: when a driver is forced to do additional handling, like moving items between pallets.
Many accessorial fees result from shippers not properly classifying their freight or paying attention to the details when looking for pricing. Others come down to avoidable mistakes like incomplete paperwork. There are some ways to at least plan for these fees to keep costs in check:
Do the proper legwork.
With LTL shipments, legwork can go a long way toward helping shippers access the most accurate upfront rates and avoid charges after the fact.
Best practices every shipper should follow include:
- Take pains to properly classify. Misclassifying or failing to properly categorize freight will result in unwanted fees and delays. The devil is in the details, so don’t measure by eye. Underestimating your freight class may result in a lower rate initially, but the fees for re-classifying it can be exorbitant.
- Specify any special handling needs. Communication is critical. If freight contains hazardous, fragile, or perishable items, carriers need to know in advance, as these items may require special handling or need to travel on a separate vehicle—resulting in additional charges.
- Double-check the paperwork. Confirming the shipping documents are complete and accurate helps prevent unnecessary fees and delays.
While those steps can help you avoid paying more than you intended to from shipment to shipment, you can also optimize LTL contracts to consistently keep rates low:
Hand negotiation to a partner that has deep experience with LTL shipments.
At CTSI-Global, we’ve been working in the logistics world for more than 60 years. That wealth of experience has put us in a prime position to negotiate a better LTL rate structure for our clients, so they can get the most value out of every small shipment.
Our LTL expertise stems from our:
- Rich knowledge of contracts. We know LTL contracts inside and out. Combined with our experience with historical patterns and carrier capabilities, that knowledge allows us to tap into bigger discounts.
- Leading-edge modeling capabilities. Using real-world scenario analysis and our pricing matrix, we can determine your optimal tariff year, discount level, and FAK structure.
- Sophisticated industry benchmarking. Thanks to our robust customer base, we’re frequently able to use benchmarks to negotiate lower classes of pricing.
Let us handle your LTL negotiations for you—and get you the best rates. Contact us today.