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difference between ftl and ltl

Differences Between LTL and FTL Shipping

Deciding the best mode for shipping your freight can be complicated. To determine the primary way to move freight, shippers should identify the size of the shipment, the budget, the delivery schedule, and the freight’s fragility. To know which mode fits you best, you have to know the difference between LTL and FTL shipping.

Low transportation rates and fuel surcharges are affecting truckload carriers more than LTL companies. As a solution, many truckload carriers are removing old trucks from their fleets to close the overcapacity gap until freight demand picks up. LTL carriers, however, are not experiencing overcapacity and have maintained, and even raised rates due to the deficit of LTL trucks. In July 2016, both truckload and LTL carriers added jobs.

What is full truckload (FTL) shipping?

  • Freight shipments that need the entire space or weight limit of a truck’s trailer is a full truckload (TL) shipment. TL shipping is the best option when the freight weighs more than 15,000 pounds, or the shipper has more than 10 pallets of freight.
  • Full TL shipments travel on one truck to its destination, creating a more reliable timeframe for shippers. Truckload shipments are generally more expensive and require less handling than LTL shipments.

What is less-than-truckload (LTL) shipping?

Less-than-truckload or LTL shipping is a transportation mode where freight shipments do not require the entire space in a truck’s trailer and are often combined with other shipments. LTL shipping is the best option for shipments that weigh less than 15,000 pounds.

difference between ftl and ltl

LTL shipping allows multiple shippers to share space on the same truck. Since you’re sharing the truck’s space with multiple shippers, there is a higher risk of damaged goods. With LTL trucks, your freight is usually loaded and unloaded multiple times before arriving at its destination.

Due to the concept of space sharing, LTL often lets shippers save costs on transportation and be more flexible with their shipping.

What is the difference between LTL and FTL shipping?

The main difference between LTL and FTL shipping is the freight volume you are going to ship. Full truckload better suits shippers who have a large amount of cargo to fill out the entire trailer. If you send a few pallets, LTL shipping will be a better option for you.

When using OTR transportation, there are a variety of trailer choices, including:

When looking for consistent service, shipment visibility, cost-effective modes, and reliable routes, shippers of all sizes turn to 3PL services. 3PLs offer shippers size, scale, flexibility, and technology.

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Market Update: LTL Volume Down but Prices Stay Firm

The less-than-truckload (LTL) market is adjusting to a soft freight environment, triggering less volume, revenue and profits. As the U.S. freight economy weakened, LTL carriers saw a slip in revenue year-over-year. To date, the only large LTL carrier that hasn’t reported a decline in revenue is FedEx.

In the first quarter of 2016, LTL carriers posted a 3.1% rise in yields (revenue per hundredweight) despite a 2.7% drop in tonnage per day. Compare that with a 6.6% rise in yields on a 0.9% rise in tonnage per day in the first quarter of 2015.

Most LTL carriers said freight demand was better in July, but still reduced compared to a year ago. Stifel trucking analyst, David Ross, called the LTL pricing environment “a little more competitive than originally anticipated.” But, most LTL executives say pricing remains rational, even during the usually slow first quarter.

“Despite near-term headwinds from decreasing fuel surcharge revenue and an inconsistent industrial economy, we believe LTL pricing remains rational,” says James Welch of YRC Worldwide. “LTL companies are focused on evolution of the supply chain distribution process and getting an adequate return on the capital,” Welch continued.

LTL carriers have been able to maintain rates even with declining volumes. Some LTL carriers have even increased rates. The pricing ceiling grown by LTL carriers since the last recession and LTL price war appears to be holding firm despite the sluggish economy.

LTL carriers aren’t experiencing excess capacity like the truckload sector. 55% of shippers surveyed said LTL capacity was balanced. Only 6% expect LTL capacity to increase over the next 12 months, while 74% said they expect capacity to remain about the same.

Since LTL rates aren’t decreasing anytime soon, shippers can avoid extra fees and negotiate better base rates by working with a 3PL. In order to negotiate lower transportation rates, shippers should consolidate freight, leverage freight spend, highlight attractive freight and utilize the CzarLite Tariff.

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Announcing the Newest Surcharge for LTL Shipments

The US transportation system moves more than 54 million tons of goods worth nearly $48 billion each day. Freight tonnage is expected to increase by 45% by 2050. In the US, nearly 70% of all freight tonnage is moved by trucks.

To meet the strict requirements of consumers, many shippers find themselves sending smaller, more frequent freight shipments, using less-than-truckload shipping. LTL freight shipping has increased about 1% this year.

Best Practices of LTL Shipping

Shippers who select LTL freight shipping can make their freight more attractive to LTL carriers by correctly weighing the shipment, providing longer lead times, consolidating orders and learning LTL trends.

  • Accurate Weight & Number of Pallets. Carriers reweigh about 80% of shipments, which means extra fees and reduced efficiency. Accurately weighing your shipment and reporting how many pallets are being hauled will pay off in the long-term.
  • BOL. Every detail on the bill of lading needs to be reviewed to avoid miscommunication. Wrong information on the bill of lading can affect rates and transit time.
  • Accessorials. LTL carriers charge an extra fee for a variety of services, like reclassifications, collect on delivery, limited access, and pallet jacks. There are wide variances of rate bases and accessorial fees, so it’s important to check carrier’s rules tariff and create a relationship.
  • Packaging. When carriers have to take extra steps to handle a packaged shipment, time and money is lost. When freight isn’t packaged correctly, it risks being damaged.

Recent Changes with Popular Carriers

Due to the changing logistics industry, FedEx said the company has seen an increase in residential deliveries and larger-sized packages. To continue safe handling and on-time deliveries, providers increase fees.

In early May 2016, FedEx and UPS announced new surcharges for additional handling on ground packages in the US and Canada. For FedEx, the rule states that any ground package that measures more than 60 inches, but equal to or less than 108 inches along its side will be charged. For UPS, the surcharge is applied to any package with the longest side exceeding 48 inches. For both carriers, the fee is $10.50. This rule is effective June 1, 2016.

According to Internet Retailer, FedEx said the handling charge threshold was lowered to account for the fact that e-commerce shipments are more dynamic and varied in size, and the surcharge will help handle the increased complexity of sorting those items.

Carriers add fees and surcharges because customers are ordering online, and providers must adjust their fees and services to remain profitable.

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3 Ways CPG Shippers Reduce LTL Shipping Costs

CPG shippers rely heavily on LTL transportation, which leads to several inefficiencies. CPG shippers rarely have the freight volume to utilize a full truckload, and often feel stuck using more expensive, slower LTL transportation. But, there are ways to make LTL shipping as efficient and cost-friendly as TL shipping. 

LTL transportation is expensive and rates continue to climb. Other issues with LTL shipping include a greater risk of damage, slower transit time, inconsistent pricing models and a bigger carbon footprint.

LTL shipping is a necessary part of a CPG shipper’s transportation strategy, but CPG shippers don’t need to live with the downsides of LTL freight moves.

3 ways CPG shippers can reduce LTL costs:

  1. Cross-Docking. It’s unlikely you can cross-dock all of your freight – many CPG shippers find the cross-docking process difficult due to limited inbound freight visibility. But, when a strategic portion of your freight is cross-docked, you save money by eliminating the time and costs associated with the handling and storage of products at a warehouse facility. Freight moves through your supply chain and to customers more quickly.
  2. Load Consolidation. Retailers bring in products from thousands of suppliers. CPG shippers ship to the same retail location as hundreds of other companies, even competitors. Consolidating loads to make full truckload shipments makes sense. Load consolidation is quicker and utilizes available trailer space, leading to lower costs and increased service levels.
  3. Rate Negotiation. There are many ways you can negotiate rates with LTL carriers. You can consolidate your entire freight spend to leverage lower GRIs, base rates, fuel surcharges or even accessorial costs. When you negotiate, you can keep the LTL carrier base small so that bids are more competitive. Accurate data and transparency in the process will also make LTL carriers want to work with you, and lower their rates to do so.

CPG shippers who apply these 3 tactics will see decreased costs and improved service in LTL freight moves. Plus, you’ll experience reduced inventory carrying costs, decreased occurrence of lost or damaged products, and a more efficient overall transportation strategy.

Typically, CPG shippers partner with a 3PL or multiple 3PLs to help manage the costs and complexities of LTL transportation. 3PLs have the leverage to find the best rates and the technology to efficiently control LTL freight. They also have access to a large network of LTL carriers and can provide you with the best, most reliable carriers for your freight.

Want more CPG shipping tips? Click here: 4 Logistics Solutions for Struggling CPG Shippers

When Partial Truckload Shipping is Right for You

What is Partial Truckload Shipping?

Partial truckload, or volume LTL, is a mode used by shippers looking for faster transit times, less handling and lower costs. Partial truckload shipments are used by shippers with whose freight is less than a full truckload, but more than an LTL shipment. The exact amount of freight needed for a partial truckload shipment depends on the weight, linear feet and service requirements.

Partial truckload or volume LTL shipments are typically between 7,000 and 28,000 pounds and/or contain more than 7 pallets.

Why Should I Consider Partial Truckload?

partial truckload shipping

Partial shipments are intended for shipments that are larger than LTL, but smaller than a full truckload. Shippers with low-density freight and time-sensitive freight find the most benefits through partial truckload shipping.

When you don’t have enough freight to fill an entire truck’s trailer, but want benefits of traditional truckload shipping, then partial shipping is a great option. During the partial truckload shipping haul, other freight will be combined on the truck, but the truck will not make as many stops as an LTL haul.

What are the Benefits of Partial Shipping?

  • Cost Savings
  • Partial truckload shipment cost is determined by the number of linear feet the freight takes up.
  • No freight class required.
  • There are no surprise accessorials or other transportation fees – shippers pay for what they use.
  • Traditionally, partial truckload shippers find discounted rates (compared to a parcel, TL or LTL).
  • Less Damage and Better Service
  • Partial truckloads move through fewer terminals, so freight is touched less.
  • Freight ships on one truck.
  • Fewer stops increase the percentage of on-time delivery.

Related PLS Logistics blogs:

 

 

5 Ways to Save on LTL Transportation

Less-than-truckload (LTL) transportation, inbound and outbound, can be a complex and expensive process for many companies. Moving LTL freight requires a different approach than moving truckload freight. Without the proper technology and manpower in place, it can be difficult to know where to start implementing cost-saving strategies, and if those strategies are effective. 

5 ways to save money on LTL transportation:

  1. Create Visibility into LTL Freight Spend. Many companies lack the ability to see how much they’re spending on LTL and which components are the most expensive. This is crucial information while trying to implement changes – not only to identify specific inefficiencies but also to measure the progress of implemented solutions. A transportation management system (TMS) is the best way to gain visibility into LTL freight spend. Detailed, customized performance reports, along with instant status notifications, give you all the information you need about LTL transportation spend.
  2. Work with Suppliers on Inbound LTL Freight. Suppliers often hide the true cost of transportation in the price of their products, making LTL transportation a source of profit. It is best to take control of inbound freight to find the most efficient carriers and routes. This is especially important for retailers, who have to deal with omnichannel challenges, shipping LTL and partial shipments to several different locations at the same time. Inbound LTL freight can be costly. By properly managing inbound LTL transportation, you will find savings through reduced rates and efficient delivery.
  3. Avoid Extra Accessorials. Some accessorial charges, such as lift gate services or remote access locations, are mandatory. But many accessorial charges can be avoided, such as limited access fees, where a driver has to enter a building to find the consignee. Avoidable fees add up over time and significantly contribute to the price of LTL transportation. By accurately filling out the bill of lading and setting standard shipment receiving procedures, you can quickly reduce or eliminate the number of extra accessorial fees you receive for LTL transportation.
  4. Negotiate Lower GRIs or Base Rates. LTL transportation rates are set to rise in 2016 and beyond. FedEx and others have implemented GRIs, along with fuel surcharge increases, which will raise rates for everyone, however, there are opportunities to negotiate lower GRIs or base rates. By doing things like consolidating and leveraging LTL freight spend, utilizing the standard CzarLite Tariff, and highlighting attractive freight, you can directly negotiate lower LTL rates.
  5. Work with a 3PL. A 3PL company has resources that are too expensive or too time to consume to own and operate in house. 3PLs have internal expertise and can find hidden cost savings opportunities. 3PLs have their own prequalified LTL carrier network that can complement your current assets or be used as leverage to find the lowest rates. A 3PL will find time and cost savings in LTL transportation.

Want to read more about LTL transportation? Check out these posts:

 

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How to Negotiate Lower LTL Freight Rates

Operating costs are rising for LTL carriers due to a number of factors – the driver shortage, rising pay, and aging equipment. Spot market and contract rates have both risen to compensate for these extra costs, however, contract rates rose higher than spot market rates and remain higher. Knowing how to get and negotiate the lower LTL freight rates is important if you want to save costs.

This is unusual since promising freight volume ahead of time typically leads to freight savings.

So, why have contract rates risen above spot market rates?  Because contract carriers bought a record number of trucks in 2015 and boosted driver pay, all in an effort to regain capacity and reclaim market share that had been lost to spot market providers.

how to negotiate LTL freight rates

These rates aren’t going down anytime soon, as operating costs continue to climb. Unfortunately for shippers, the transportation industry has a serious shortage of capacity and most companies find it necessary to pay higher LTL contract rates to get truck capacity. How can you avoid paying such high contract rates for transportation?

Here are 3 tips to negotiate lower LTL freight rates:

Use the CzarLite Tariff

The CzarLite tariff for LTL freight is independent of trucking companies and is the transportation industry’s base rate standard. Most carriers develop their own tariff and encourage you to use it. For example, a carrier may offer you an 80% reduction on fuel surcharges if you use their base rate, which sounds great, but their base rate will likely end up costing more than the savings. The CzarLite tariff transparency into negotiations by providing you more visibility into costs compared to other carriers.

Utilize LTL Guaranteed Service Levels

Using guaranteed freight services is a way to negotiate lower base rates or GRIs in the future. Guaranteed freight is when an LTL carrier guarantees a specific service level. Carriers prefer to operate theseltl-rates-on-the-rise.jpg services – it gives them an opportunity to acquire more freight spend. With guaranteed freight, a shipper immediately spends less time on track and trace operations. By paying for a service that carriers want to perform, you gain preference and can leverage lower rates on standard shipments, fuel surcharges or GRIs during future negotiations.

Highlight Attractive LTL Freight, but Don’t Hide Unattractive LTL Freight

Shippers should highlight attractive freight during rate negotiations. Carrier-friendly freight, in general, allows carriers to utilize their truck space effectively. Dense, small, and stackable freight that fits properly on a pallet will be easy and efficient for a carrier to haul. It’s also important to disclose information ahead of time about freight that will be difficult or inefficient to haul.

Eliminate any surprise charges and keep the carrier compliant with all state and safety regulations. LTL carriers need to know their risk liability before hauling freight because this affects their view of the value and cost to carry the freight. Carriers are rated by a CSA system by DOT. Losing rank in CSA due to compliance issues the carrier was not notified about can hurt their chances of getting new business, and you can be sure they won’t want to give you any discounts.

Learn more about reducing transportation spend in post 7 Steps to Reduce Freight Costs.

Need help with freight rates? Get a free quote right now! 

Less Than Truckload Shipping: An Ultimate Guide

What is less than truckload freight shipping?

Less than truckload shipping is a transportation method where your freight doesn’t take the entire container space. Freight is combined into one trailer with multiple shipments. LTL shipment typically weighs between 151 and 20,000 pounds. When a freight shipment isn’t large enough to fit into a 48- or 53-foot trailer, a shipper’s best option is to use LTL.

less than truckload

This transportation option is more cost-effective and environmentally friendly when only some products need to be transported.

The benefits of LTL shipping include gaining control over shipment visibility, decreasing costs, and obtaining scheduling flexibility.

How does less than truckload shipping work?

LTL trucking has suffered for a long time. Historically, it has been an expensive mode of transportation. However, the past couple of years it has seen unusual growth. Short capacity in the full truckload sector forces some freight to move via LTL. Some LTL carriers are benefiting from this, but many aren’t.

Most of the time, a billion-dollar LTL trucking company will handle your LTL freight. The industry is dominated by these large carriers, and this trend is likely to continue. The top 25 LTL carriers own approximately 91 percent of all LTL revenue and are benefiting significantly from the rise in economic activity, increasing revenue by 9.1 percent in 2014.

This is all at the expense of small LTL carriers, whose revenue dropped 6.6 percent in 2014, which followed a 3.2 percent drop in 2013, and many are going out of business. But for large LTL carriers, the future looks bright. They will continue to grow and eat up more of the LTL market.

As economic activity continues to rise, there will be more pressure on freight capacity and pricing in the LTL trucking sector. 3PL-shipper relationships are valuable and common because 3PLs know how to negotiate with the large LTL carriers and secure better rates and better service than a shipper.

Determining less than truckload pricing

less than truckloadLTL rates can be very confusing because a variety of factors calculate the final payment. For truckload shipping, rates are determined based on per-mile or per-hundredweight plus a fuel surcharge, but LTL shipping is influenced by weight, density, class, distance and more.

Less than truckload shipping is used for shipments that are too large to be sent as a parcel but too small to fill an entire truckload. LTL carriers collect freight from various shippers and consolidate that freight to its destination.

Here are 8 factors that determine less than truckload freight rates:

  1. Weight: For LTL shipments, the more a shipment weighs, the less you pay per hundred pounds.
  2. Density: Shippers have to know how to accurately calculate the LTL shipment’s density and mark it on the BOL. You divide the total weight of the shipment by the total cubic feet to determine density. If the shipment is on pallets, use the dimensions of the pallet, the combined height of the freight and the pallet, and the total weight of the shipment. Once density is calculated, you can determine the freight’s class.
  3. Freight Class: There are 18 different classes – ranging from 50 to 500. The class is determined by density, value, stow-ability, and handling. Lower classes have lower rates and higher classes are subject to higher rates.
  4. Distance: If an LTL shipment has to be interlinked, then there could be more charges. Interlining occurs when a shipment’s destination is outside the carrier’s standard service area and the carrier must find another LTL carrier to finish the delivery.
  5. Base Rates: LTL carriers establish their own base rates, which are quoted per one hundred pounds.
  6. Freight All Kinds (FAK): FAK is an arrangement between the client and carrier that enables multiple products with different classes to be shipped and billed as the same freight class.
  7. Minimums: LTL carriers apply a specific price point, an absolute minimum charge, which they will not charge below.
  8. Accessorials: These charges apply if LTL carriers perform more duties than stated on the BOL. Usually, these charges can be negotiated or avoided.

What is the LTL freight class?

Freight class for less than truckload shipments is important because it plays a substantial role in calculating how much the LTL carrier will charge for moving the freight to its final destination.
There are 18 different LTL freight classes: 50, 55, 65, 70, 77.5, 85, 92.5, 100, 110, 125, 150, 175, 200, 250, 300, 400 and 500.

The higher the class, the higher the rate for every hundred pounds you ship. If a product’s classification is inaccurate, then the shipper runs the risk of paying too much, violating transportation laws that could lead to major fines.

To learn more about freight class, download our free eBook here!

What characteristics determine LTL freight class?

Density and Value

The density is the space the item occupies in relation to its weight. The density is calculated by dividing the weight of the item in pounds by its volume in cubic feet. Density guidelines assign classification 50 to freight that weighs 50 pounds per cubic foot. The Commodity Classification Standards Board (CCSB) assigns classifications 70, 92.5, 175 and 400 to freight with densities of 15, 10.5, 5, and 1 pound per cubic foot, respectively. Freight less dense than 1 pound per cubic foot is classified as 500. Your item’s volume in cubic feet is Length x Width x Height/1,728, measuring all dimensions in inches. The density of your item equals Weight/Volume, where you measure Weight in pounds and Volume in cubic feet.

Stow-ability

Most freight stows well in trucks, trains, and boats, but some cargo is regulated by the government or carrier policies. Excessive weight, length or protrusions can make freight impossible to load with other freight. The absence of load-bearing surfaces makes freight impossible to stack. A quantifiable stow-ability classification represents the difficulty in loading and carrying these items.

Handling

Most freight is loaded with mechanical equipment and poses no handling difficulties, but some freight, due to weight, shape, fragility or hazardous properties, requires special handling.

Liability

Liability is the probability of freight theft or damage, or damage to adjacent freight. Perishable cargo or cargo prone to spontaneous combustion or explosion is classified based on liability and assigned a value per pound, which is a fraction of the carrier’s liability. When the classification is based on liability, density must also be considered.

How to reduce LTL costs?

There are two notable ways to drive down less than truckload freight costs. The first is to avoid or mitigate accessorial charges. These occur when a carrier has to provide services above and beyond the standard shipping procedures.  There are three different types of accessorials:

  • Organizational: These are charges when a carrier has to make an unnecessary appointment call, reweigh an LTL shipment or correct the bill of lading (BOL).
  • Transportation: A carrier will charge extra for transportation when a driver has to go inside a building to deliver a package, is going to an area that is difficult to get to, or if the freight doesn’t fit neatly onto a pallet or into a truck.
  • Equipment: These charges are most common.  The fuel surcharge belongs to this category.  A carrier will make additional charges if you need a lift gate, forklift or other equipment for delivery.

There are many different accessorial charges a carrier may use and sometimes it is impossible to avoid them.  However, you can avoid or mitigate most accessorials by being aware of what charges may apply to your individual LTL shipments.

The second, to work with a 3PL. They are very knowledgeable in the LTL industry and can help you avoid accessorial charges.  A 3PL also has the experience to negotiate prices with LTL carriers, so they can get you the best rate with the best service.  3PLs can also provide a number of other services to give you visibility and control over your LTL shipments.

Why do LTL carriers add GRIs?

A general rate increase (GRI) is the average amount that LTL carriers increase base rates. Carriers apply a GRI to all or specific trade routes in order to balance the cost of business. The rate increase helps carriers maintain service levels, attract and retain drivers, compensate high fuel costs and integrate technology to enhance customer service.

For shippers, GRIs generally means that you will pay more to move your LTL freight. To avoid a GRI surcharge, you can negotiate special rates with carriers or leverage a 3PLs buying power to secure competitive pricing. A 3PL helps companies recognize when a GRI is affecting their bottom line and can advise shippers on how to keep costs down.

How to improve the attractiveness of your less than truckload freight?

To secure capacity from LTL carriers, shippers need to consistently differentiate themselves and improve their attractiveness to carriers. Today, carriers expect more from shippers in exchange for competitive rates, including:

Annual freight spends and shipment data

Shipment level data should include ship dates, origin and destination zip codes, freight class, weight, details of accessorial charges, number of pallets, their dimensions, and shipment density. With more information at the carrier’s disposal, there is less risk.

Pictures

Provide LTL carriers with photos of common inbound and outbound shipments from your dock, as well as corresponding weight and dimensions of LTL shipments in those photos.

Transparency

Disclose your historical frequency of guaranteed service, volume shipments, and frequency of claims. Hiding information from a carrier because you fear higher rates may ultimately lead the carrier to increase GRI or undergo major supply chain disruptions.

Know the trends

Ask carriers to bid using current tariff rate bases and use a standardized market fuel surcharge program.

Enlist a 3PL

Shippers will benefit from a 3PL’s pre-qualified LTL carrier network, technology, analytical tools, relationships and support without the fixed expense of managing and tracking LTL freight in-house.

 How 3PLs benefit LTL shippers and carriers?

Moving LTL freight isn’t easy and often shippers need assistance, but where does a carrier go for assistance? Many people are unaware that 3PLs are there to help both shippers and carriers. Although a 3PL may negotiate a low price from a carrier, they will help that carrier in other ways. Otherwise, the carrier would never agree to lower prices.

  • Pricing: When a 3PL manages to price, less than truckload shippers can go to one place to look for capacity instead of calling multiple carriers, repeatedly providing pickup zip, destination zip, piece count, and weight. Carriers working with 3PLs can get the targeted freight they want at a reasonable price and protect margins.
  • Administrative Tasks: Inevitably, everyone has to do paperwork. A 3PL will facilitate document creation with a shipper and transfer them to the correct LTL carrier. The shipper will save time doing the paperwork and the carrier will save time waiting for it; both can focus more time on core business functions.
  • Technology: TMS technology from 3PLs simplifies the shipping process for both carriers and shippers. LTL shippers will automatically get the best rate, lane, and mode while LTL carriers will be connected with their ideal customer base.
  • Special Shipping Arrangements: These can be time-consuming and difficult, especially for LTL shippers. A 3PL will have pre-qualified carriers for any special shipping requirements. Also, it may even be able to help mitigate LTL accessorial charges. This saves the shipper time from searching around for the perfect carrier. LTL carriers benefit, too, as they can spend less time and resources on advertising/promoting their special shipping capabilities.

Download our free LTL Freight Savings eBook and get to know more of the LTL freight pricing and how to make it more profitable for your business!

What Determines LTL Freight Class?

freight classWhat is Freight Class?

When it comes to moving Less-than-Truckload shipments one of the first things to consider is how the product is defined by the trucking industry.

Each shipment is defined by a classification, depending on the nature of the product. This Freight Classification plays a prominent role in calculating how much the carrier will charge you for transporting it. Choosing the wrong Freight Class could waste money, time, resources, and delay shipments. It is important to classify a shipment correctly.

There are 18 different freight classes defined by the National Motor Freight Traffic Association (NMFTA): 50, 55, 60, 65, 70, 77.5, 85, 92.5, 100, 110, 125, 150, 175, 200, 250, 300, 400, and 500. The higher the class, the higher the rate for every one hundred pounds shipped.

How to Find Freight Class?

Most transportation management systems (TMS), such as our own PLS ProSM, have built-in freight class estimators. If possible, contact the manufacturer of the product. The manufacturer will know the freight class of their own products. Official freight classes are listed by the National Motor Freight Traffic Association (NMFTA), and can be viewed in their publication NMFC, or National Motor Freight Classification tariff.

How are Freight Classes Determined?

There are a couple of factors that affect LTL Freight Class. The main four are the density of the product, how the product is handled, its ability to be stowed, and the type of liability it assumes. Here are further explanations of each:

    • Density: Density guidelines assign classification 50 to freight that weighs 50 pounds per cubic foot. The Commodity Classification Standards Board (CCSB) assigns classifications 70, 92.5, 175, and 400 to freight with densities of 15, 10.5, 5, and 1 pound per cubic foot, respectively. Freight less dense than 1 pound per cubic foot is classified as 500.

      The density is the space the item occupies in relation to its weight. The density is calculated by dividing the weight of the item in pounds by its volume in cubic feet. Your product’s volume in cubic feet is Length x Width x Height/1,728, where all dimensions are measured in inches. The density of your item = Weight/Volume, where Weight is measured in pounds and Volume is measured in cubic feet.

    • Stow-ability: Most freight stows well in trucks, trains, and boats, but some articles are regulated by the government or carrier policies. Some items cannot be loaded together. Hazardous materials are transported in specific manners.

      Excessive weight, length or protrusions can make freight impossible to load with other freight. The absence of load-bearing surfaces makes freight impossible to stack. A quantifiable stow-ability classification represents the difficulty in loading and carrying these items.

    • Handling: Most freight is loaded with mechanical equipment and poses no handling difficulties, but some freight, due to weight, shape, fragility, or hazardous properties, requires special attention. Therefore, a classification that represents ease or difficulty of loading and carrying the freight is assigned to the items.
    • Liability: Liability is the probability of freight theft or damage, or damage caused to adjacent freight. Perishable cargo or cargo prone to spontaneous combustion or explosion is classified based on liability and assigned a value per pound, which is a fraction of the carrier’s liability. When classification is based on liability, density must also be considered.

Freight Class plays a large role in the price of shipping. Choosing the wrong Freight Class can lead to surprise fees. Select the correct classification with the help of a TMS, like PLS Pro, or by subscribing to the NMFC publication, and keep shipping without hassle.

6 Key Factors That Determine LTL Freight Class

determine ltl freight classWhen it comes to moving less-than-truckload shipments from point A to point B, one of the first things to consider is its definition in the trucking industry. In the world of freight shipping, each product definition is its classification. It is important to know how to determine LTL freight class because it affects the final price of your shipment.

The class of freight plays a prominent role in calculating how much the carrier will charge you for transporting it.

How many freight classes are there?

There are 18 different classes LTL freight can ship under: 50, 55, 60, 65, 70, 77.5, 85, 92.5, 100, 110, 125, 150, 175, 200, 250, 300, 400 and 500. The higher the class, the higher the rate for every hundred pounds you ship.

How do you determine LTL freight class?

The many definitions or classes of freight are listed in the National Motor Freight Classification tariff, commonly referred to as the NMFC. The NMFC is a publication for motor carriers containing rules, descriptions, and ratings of all commodities.

There is a publication to classify freight for freight bill rating purposes. Besides defining the classes of shipping commodities, the NMFC also assigns item numbers to each type of commodity. The item number relates not only to the commodity itself, but to its packaging, the material of the commodity, and other considerations.

Item numbers associate with rates as well as commodity classifications. PLS Logistics Services’ LTL department is very familiar with the NMFC classification and can help you determine the proper class of your item.

Which factors affect LTL freight class?

Before a class can be determined, there are some characteristics of the freight that needs to be identified. You need to know how the freight’s density, the stow-ability, how to handle it, and what type of liability it assumes. There are several main factors that determine the LTL freight class, including:

Dimensions

Essentially, dimensions play a large role in estimating the final price of your shipment. Especially, when shipping LTL. Although it goes along with many other factors, length, width, and height are important. It is crucial to provide an exact and correct number since even small discrepancies may result in additional charges.

Weight and Packaging

The next critical measure of your shipment’s cost is the actual weight. Most likely you’ll have to palletize your freight, so the actual weight means the weight including the pallet. Additionally, your shipment’s package will be considered when determining the freight class.

Density and Value

Density guidelines assign classification 50 to freight that weighs 50 pounds per cubic foot. The Commodity Classification Standards Board (CCSB) assigns classifications 70, 92.5, 175 and 400 to freight with densities of 15, 10.5, 5, and 1 pound per cubic foot, respectively. Freight less dense than 1 pound per cubic foot is classified as 500. The density is the space the item occupies in relation to its weight. You calculate density by dividing the weight of the item in pounds by its volume in cubic feet. Your item’s volume in cubic feet is Length x Width x Height/1,728, where all dimensions are measured in inches. The density of your item = Weight/Volume, where Weight is measured in pounds and Volume is measured in cubic feet.

Stow-ability

Most freight stows well in trucks, trains, and boats, but some articles fall under the regulation by the government or carrier policies. Some items don’t fit together. You need special conditions to move hazardous materials. Excessive weight, length or protrusions can make freight impossible to load with other freight. The absence of load-bearing surfaces makes freight impossible to stack. A quantifiable stow-ability classification represents the difficulty in loading and carrying these items.

Handling

Loading freight with mechanical equipment poses no handling difficulties, but some freight, due to weight, shape, fragility or hazardous properties, requires special attention. You have to mention a classification that represents ease or difficulty of loading and carrying the freight and assigns it to the items.

Liability

Liability is the probability of freight theft or damage, or damage to adjacent freight.
Perishable cargo or cargo prone to spontaneous combustion or explosion is classified based on liability and assigned a value per pound, which is a fraction of the carrier’s liability. When the classification is based on liability, density must also be considered.

In conclusion, the class of your freight plays a prominent role in calculating how much the carrier will charge you for transporting it. Knowing the characteristics of freight is very important.

If the product class is inaccurate, you risk paying too much. Also, you violate transportation law which leads to hefty fines if caught trying to pay a cheaper rate.

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