How to save at least 20% on your LTL Freight shipment (or even more!)

Every penny counts and the pressure is always on, saving money on Less-Than-Truckload (LTL) freight shipping can feel like a daily puzzle. As a shipping manager, you’re in the hot seat, constantly juggling the need to cut costs with the demand to maintain quality and efficiency. It’s a tough gig, but there are ways to make it a little easier on your wallet and your peace of mind. Here are some practical tips to help you trim those LTL shipping costs without compromising on service.

Why LTL Cubic Capacity is a Critical Metric for Shippers

When managing logistics, particularly in less-than-truckload (LTL) shipping, cubic capacity is a fundamental concept that can significantly influence both operational efficiency and cost-effectiveness. Understanding and managing this aspect effectively is crucial for any shipper looking to optimize their freight operations. Let’s explore what cubic capacity entails and why it’s so vital for your shipping strategy.

Defining LTL Cubic Capacity

Cubic capacity in the context of LTL shipping refers to the total volume that a shipment occupies within a trailer, measured in cubic feet. Unlike full truckload (FTL) shipping, where a single shipper uses the entire truck, LTL shipments share trailer space with other freight. This method makes efficient space usage a priority, as each shipper only pays for the space their cargo occupies.

The Importance of Managing Cubic Capacity

  1. Cost Control: Exceeding the allocated cubic capacity can lead to substantial additional charges. Carriers typically have strict policies on space usage, and shipments that occupy more space than what is paid for incur fees. These can escalate the cost of shipping dramatically, affecting your overall logistics budget.
  2. Operational Efficiency: Properly calculating and optimizing the use of cubic capacity ensures that you can load the maximum possible goods without wasting space or incurring extra costs. This efficiency is crucial in maintaining the flow of goods and meeting delivery schedules without delay.
  3. Pricing and Budgeting Accuracy: Many LTL carriers use dimensional pricing models, which take into account both the weight and volume of shipments. Understanding the cubic capacity helps in predicting shipping costs more accurately, allowing for better budget management and financial planning.
  4. Strategic Packing and Loading: Knowledge of cubic capacity impacts how shipments are packed and loaded. Efficient packing reduces the volume of shipments, potentially lowering shipping costs and minimizing the risk of damage during transit.
  5. Enhanced Negotiating Power: Being knowledgeable about the specifics of your shipments, including their cubic capacity, can provide leverage when negotiating terms with carriers. This information demonstrates your understanding of the logistics involved, which can lead to more favorable shipping rates and terms.

Key Considerations for Shippers

  • Measure Precisely: Ensure that all dimensions of a shipment are accurately measured to calculate the correct cubic capacity. Small miscalculations can lead to significant discrepancies in space allocation and costs.
  • Optimize Packaging: Evaluate your packaging strategies to make them as space-efficient as possible. Consider the use of multi-depth boxes, adjustable pallets, or collapsible containers to optimize space.
  • Stay Updated on Carrier Policies: Carrier policies regarding cubic capacity and associated fees can change. Keeping abreast of these updates helps prevent unexpected charges and ensures compliance with shipping regulations. WE CAN HELP YOU WITH THIS!

Conclusion

Cubic capacity is not just another metric in shipping; it’s a pivotal aspect that directly affects the cost and efficiency of your LTL freight operations. By understanding and effectively managing this element, shippers can avoid unnecessary expenses, improve operational workflows, and maintain competitive advantage in the logistics sector. Knowledge of cubic capacity is thus not only about saving on costs—it’s about strategic shipping management.

Do you have a loading dock?

This is a question that we genuinely feel can help save shippers hundreds, if not thousands of dollars every year from not having surprise charges added to their shipments. If you just had a flash cringe memory of a charge that got added to one of your shipments for a limited access delivery, or a residential charge than you know exactly what I mean.

Sometimes these charges can be somewhat significant, which is painful. And they can completely eat up your profit margins. Especially on smaller orders. Let’s dive in to learn more.

The carrier IS GOING to add charges without authorization.

That’s the unfornuate reality with LTL Carriers. Operationally, it would be extremely taxing on LTL Carriers to stop and wait for approval every time something additional is needed to make a delivery. It could also result in the carrier not being able to finish all of their pickups or deliveries. Drivers tend to have several stops they have to make every day and it’s important to maximize their time. The nature of LTL Freight is that you agree to pay additional charges as needed to complete a delivery.

Why you should ask if your customer has a loading dock.

This is a great way to determine if there may be additional accessorials required. If a business has a loading dock, it can be assumed that whoever built the building made sure there was plenty of room for a tractor-trailer to fit and back up to the dock. It would indicate the location is made in part in the activity of loading and unloading trucks. These types of building are almost always located in an industrial area or at a location that is suitable for larger vehicle traffic. If there is a loading dock at delivery, it’s very unlikely to require additional services to complete delivery.

What if your customer says no?

Well, now it’s time to start asking some questions to help determine what will be required for delivery. In a few short moments you can determine exactly what kind of delivery you are making and save yourself from those annoying additional charges.

Let’s have a look at some of the additional charges we see most often on LTL deliveries.

Residential Delivery

Many businesses are ran out of their homes. Receivers will say things like “It’s a business delivery”. Let me help sort this out in as simple of terms as possible. If someone builds a tiny home and puts that thing out in front of a massive Amazon Fulfillment center, it won’t matter if there are 100 docks, that’s a residential delivery.

We’ve seen it all. Receivers that have their driveway expanded, receivers that have a massive parking lot installed on their property, customers that do both and get a mobile dock. It doesn’t matter. If there is a house, than it’s residential pickup/delivery and the customer is going to add the charge on.

Some tips to determine if the delivery is residential:
Ask your customer directly. “Is this a residence?”, “Is this a house?”, etc.
Do a quick google search and see if any links pop up for Zillow or Realtor.com. This is a major indicator.

If you determine that you are delivering to a residence, the next important question is whether or not they need a lift gate. Please don’t let your impression of the size and weight of your delivery be the deciding factor. If the consignee asks for a lift gate, they are going to get it and the charges will be sent to the original billing party.