Shipping your product aboard pallets is beneficial in many ways. The manner in which the shipping company views your cargo is in both logical and practical means. They are simply looking for the most efficient and cost-effective way to transport your product along with everyone else’s. A keen understanding of the methods involved in these determinations is key to your shipping success.
Shipping on pallets provides the carrier with a nice, easy to handle load. It stows away nicely on a ship, truck, or plane, and it can be easily measured and weighed for cost. As much as shipping companies love the efficient business of managing palletized cargo, their distaste for poorly packaged, uniquely shaped, fragile, expensive and un-palletized shipment is equally as strong.
In essence, the “bottom line” is the bottom line. You will be able to cut cost by creating a shipping strategy which utilizes pallet freight shipping, and in turn will incur a greater cost for each inconvenience created for the shipping carrier. Learn the nuances of each to better manage the cost of shipping.
The trucking industry implements a standard structure for analyzing each freight shipment by following the guidelines of the NMFC, the National Motor Freight Classification. Freight is organized into one of 18 classes based on density (dimensional weight), handling, stow-ability, and liability. The cost rises with each increased freight class, as a load that would cost $25 in class 50, would double to $50 in class 125, and jump to $250 in class 500.
The NMFC can also provide you with excellent guidelines to manipulate your shipping to save costs. You should be able to make better packaging and manufacturing decisions to find ways to jump into a more desirable freight class. And you’ll be able to shop around armed with better knowledge of the shipping game.
Some carriers allow for pallet pricing, where your entire load is based on a standard pallet freight size and weight, rather than a more complicated freight class code. This makes it easier for you to calculate your pallet freight shipping costs. The pallet shipping rate is derived from a maximum total size and weight of freight. Most commonly, pallet limitations are set at 48” (L) x 40” (W) x 48” (H) and a maximum weight of 1650 lbs. If you manage to consolidate and arrange pallets to take advantage of this system, you may save money, time, and hassle.
Transportation companies prefer this system because it is much easier to calculate loads by knowing exactly how many pallets they are able to carry, as opposed to adding up several products of varying sizes and weights. In this case, carriers know exactly what they are handling, and can make the appropriate accommodations quickly and accurately.
Freight invoices tend to be more accurate, as sometimes density is improperly calculated and must be adjusted by the carrier. Since, with pallet pricing, weight is only measured not to exceed 1650 lbs., the weight of your LTL shipment is flexible. Therefore, additional audits should be unnecessary and extra charges for increases in weight should be avoided.
Common Shipping Fees and Accessorial Charges
Not every package or pallet enjoys a problem-free and effortless journey—complications do arise. There are many instances in which it may be necessary for a transportation company to charge additional fees as a result of additional services required to deliver cargo. These fees are commonly called accessorial charges or accessories. Predicting or eliminating these foreseeable charges will help you obtain a more attractive rate without any surprises.
You will be charged a flat fee for accessorial charges, but they are broken down according to several different factors.
Some common adjustments made to pallet freight cost include:
Whether exceeding the pallet pricing dimensions or shipping a product greater than 8 feet in length, most transportation companies charge more for oversized freight.
For shipments exceeding 72” in height or 100 lbs. in weight, or pickup or delivery locations without accessible docks, your cargo may require a truck with a lift-gate.
Limited Delivery Access
If the pickup or drop-off location is inconvenient for a carrier to load or unload, such as a busy entrance open to the walk-in public, or an instance in which there is no employee present to assist in direction, additional fees will usually occur. Any residential, non-commercial, unmarked, difficult-to-find, or difficult to navigate area such as a construction site or convention center will require more effort and transit time to deliver goods and subsequent fees will increase.
There is a regular charge if a carrier does not deliver outside of normal business hours.
Some carriers charge a fee to handle cash received upon delivery.
If a freight class was quoted inaccurately according to the NMFC guidelines, a re-class audit will be made and you will be charged additionally for the proper class.
Bill of Lading Changes
Any changes to the original agreement between the shipper and other parties will draw additional fees.
If there are delays deemed to have been caused by you or your shipment receivers, and the delivery must be postponed, additional charges may be added.
Truck Ordered Not Used (TONU)
If your shipment was not ready in time or it became necessary to cancel a delivery for any reason, you may be charged a fee depending on the cut-off time set by the carrier.
You will be charged an accessorial fee if you keep the driver or the truck for an additional amount of time outside of what was agreed upon.
As the price of fuel fluctuates, so will fuel charges for transporting goods. This relieves the burden on carriers to speculate on the price of fuel upon departure and adjust their fee according to the market.
You will be charged if the carrier must store goods for any length of time. They may charge a fee by the hour or by the day, depending on the specifics of each situation.
Accessorial fees vary by carrier. It would be expected of you to inquire about these and other additional fees that each transportation outfit requires as part of their service. Often, by exhibiting knowledge, flexibility, and loyalty to a single carrier, these fees can be negotiated.
By truly understanding your pallet LTL freight shipment, you can identify opportunities to save money. Eliminating risk and inconvenience for your carrier goes a long way in facilitating a smooth transaction and delivery of your product. Remember to think like a shipper, and anticipate problems that may delay your delivery or cost them more.
Adjusting your product or packaging to manipulate your freight class in terms of liability, handling, stow-ability, and density, exploring pallet pricing, using standard-sized shrink-wrapped pallets, and avoiding situations that may require accessorial fees will all help to reduce your freight shipping costs. Once you have established a packaging and shipping structure based on strong knowledge of the transportation industry, you can focus more on development and growth in other areas of your business.