New changes are coming in the LTL shipping world. Over the next year, you may need to prepare to say goodbye to LTL rates based on freight class. Dimensional pricing is the future, for better or worse, and we’ve got all the details you need to know.

What is dimensional pricing?

Historically, LTL carriers have priced their shipments based on freight class. The freight class of your shipment is determined by characteristics like density, value, ease of handling, and stowability. These freight classes have allowed for standardized, predictable pricing across LTL carriers.  

This new form of pricing, however, means the cost of your LTL shipment is strictly based on its dimensions. To put it simply, pricing will be based entirely off the freight’s height, length and width only.

Why the change?

LTL carriers have realized that switching to dimensional pricing would generally allow for more shipments to be moved at a time, which would boost their profit.

According to carriers, some customers are taking up a lot of valuable space on their trailers with relatively light and bulky shipments, essentially “cubing them out”. The trailers aren’t anywhere near their weight limit, but there’s no more room in the trailer to haul other shipments.

Some LTL carriers feel that it’s easy for customers to work the system by “misrepresenting” their freight class in order to get a lower rate. Switching to dimensional pricing leaves little room for misrepresentation, as the dimensions of the freight are clearly measurable by the carrier.  They also feel that dimensional pricing is fairer to the customer, as it will be more closely related to actual shipping costs for the carrier.

Is this guaranteed to happen?

There has been a significant amount of talk among LTL carriers about testing out the dimensional pricing method and looking into the scanning technology needed to easily calculate freight dimensions. This has been sparked by a switch to dimensional pricing in the parcel world. At the end of December 2014, UPS switched to dimensional for its ground services. FedEx Ground shifted to dimensional on packages three cubic feet or more in January 2015.

Since such major parcel carriers have already made the switch, experts are agreeing it’s a good indication that the LTL industry is soon to follow suit. In fact, UPS Freight, the LTL branch of UPS, has begun offering dimensional pricing as an alternate to class rates.  

What changes can I expect for my LTL shipping rates?

After the switch to dimensional pricing, you’ll notice cheaper shipping costs for more dense freight, whereas those shipments that are light and take up more room could be more expensive than you’re used to. For example, a large pallet containing boxes of ping pong balls would be much closer to shipping the same size pallet of bricks, while pricing based on freight class would mean two very different rates for those shipments.

Just keep in mind that LTL carriers are looking to ship as much freight as possible in one trailer to meet their profit margin. If your freight takes up most of their space, the new pricing will reflect that.  

The change may not have happened in the LTL industry yet, but it’s definitely on the way. With that being said, Trinity will be here to update you on any progress in the matter. Keep an eye out for future blogs on pricing updates and ways to save money with dimensional pricing. 

There seem to be a lot of misconceptions about intermodal shipping, especially compared to other modes of transportation. Shipping over the rail is definitely worth your consideration, so we’re going to set the record straight on some of these intermodal myths. Have you discounted the idea of intermodal shipping because of one of these misunderstandings?

1.“Shipping via rail is slow.”

Because rail shipping has been around for a long time, it was, as you can imagine, quite a slow method of transport many decades ago. However, it’s a very different story now. The fact is: yes, moving freight via rail is usually slower than moving it over the road, but probably not as dramatically as you think.

Most lanes are only about one day behind truckload shipping. Sometimes, loads that must be interlined between railroads can take a bit longer. However, for most customers that utilize rail shipments, the extra day or two of transit time is a small price to pay for such large cost savings in comparison to other modes of transportation.

2.“Intermodal shipping is unreliable.”

Before technology and infrastructure developments, the rail was deemed too unreliable, with unpredictable transit times and delivery dates. These days, that couldn’t be further from the truth. In fact, countless major retailers utilize the rail to move their shipments across the country, depending on its reliability. Most intermodal lanes are in the high-90th percentile for on-time delivery.

3.“There’s a much higher chance of damage and loss with intermodal.”

Some may claim that shipping intermodal increases the chances of damaged freight due to the combination of truck and rail services. The bottom line is that this isn’t true. As long as the freight is blocked and braced properly, the train is in for a smooth ride; in fact, in a study done by the Association of American Railroads, they found that the ride quality environment on the railroad is similar to the ride quality on the highway. There’s also a lower risk of damage due to accidents and weather.

Others seem to think that chances of loss are higher with intermodal shipping. Again, this is just an untruthful myth. In fact, chances of loss are significantly lowered, because once the container is loaded onto the train, it is locked up and on the move for almost the entirety of its trip. The freight is not vulnerable to be hijacked at a rest stop like it would be on a truck.

4.“Tracking intermodal freight is difficult.”

When you ship over the rail, there’s truly no need to wonder or stress about when your freight has been picked up and delivered or where it’s at in between. It doesn’t “vanish” once the train pulls away from the rail yard. Many intermodal containers are equipped with tracking devices that allow your logistics provider or rail carrier to provide you with real-time updates on the location of your freight. When you ship intermodal with Trinity, we are in constant contact with the rail provider to ensure we have up-to-date information on the location of your freight.

Just like swallowed chewing gum doesn’t take seven years to digest, intermodal shipping is not a mode of transportation you should avoid due to inaccurate myths. This mode of transportation can save you a significant amount of money and is worth your consideration. To get an intermodal quote, click here.

Over the past year, women have been the talk of the trucking industry. The numbers of female truck drivers are on the rise, and the challenges that come along with being a woman in the industry are becoming better known. We spoke to some women in trucking to get a clearer picture of the current situation.

More women behind the wheel

Some say it’s because of the national driver shortage, and others say it’s because of rising wages, but the fact remains that there are more women in the driver’s seats of big rigs now than ever before.

In fact, the percentage of women in trucking (versus men) has more than doubled since 1990. According to the U.S. Bureau of Labor Statistics, women made up only about 2.1 percent of truckers in 1990, but in 2012, they were up to about 5.4 percent. These numbers may not seem drastic, but considering we’re talking about thousands of truck drivers, that’s pretty significant.

Even events outside of commercial driving, like the National Truck Driving Competition in Pittsburgh, have seen an increase in female truck drivers. Their most recent competition event in August 2014 had 11 female participants, which is more than they’ve seen in over 77 years of hosting the event.

Some women are attracted to the truck driving industry because of the salary, but others are motivated by personal struggles.

“I was recently divorced with a young daughter and needed to get back into the workforce fulltime with a good income to provide a good life for my daughter,” said Joanne Fatta, a 15-year trucking veteran.

Fatta was able to use state funding to go to driving school and has been with the same company since graduating over a decade ago.  She was the only female driver at her company for many years.

“As truck drivers, we also unload trailers, which is very physically demanding. I stuck it out through many work-related injuries and was awarded driver of the year for 2013, which is a huge honor at my company,” Fatta said.

For other women, the reaction from the public is motivation to keep them in the driver’s seat.

“Honestly, I love the looks and reactions I get from other drivers and customers,” said Monica Horne, a trucker in her fourth year of driving, “men look at me in almost disbelief or amazement.”

The unique traveling opportunities are also a perk for female CDL holders.

“I always tell people that I’m a paid tourist, as I’ve seen some gorgeous places,” Horne said.

“I keep a journal of our travels and share with friends, and I have even self-published four volumes,” said Chris Miller, a truck driver for seven years. “My husband and I do the lower 48 states and Canada.”

Facing unique challenges

Although more women are making their way into the trucking industry, they sometimes face challenges that may hinder their overall success – or halt them completely.

Sexual harassment is one of the biggest issues that women, in particular, are facing in the trucking industry. While this can happen on the road or during training, sexual harassment also comes in more forms than you might think. According to the U.S. Equal Employment Opportunity Commission, sexual harassment is a blanket term that refers to any situation where a person is harassed or discriminated against because of their gender.

Some women are encountering these discriminations in the CDL training process. In a recent federal court case, a judge ruled that New Prime, Inc., which is one of the nation’s largest trucking companies, violated a federal law by requiring that female truck driver applicants be trained only by female trainers. This was hindering the number of female students graduating the course because there were only a few female trainers available for students. This was ruled as sexual harassment and discrimination by the federal courts.

“It’s still like the 1950’s out here,” remarked Desiree Wood, President of REAL Women in Trucking, referring to classic gender roles in the transportation industry. According to Wood, women are having a hard time being seen as equals behind the wheel of a truck.

“Simply put, women are invisible in this industry,” said Wood, “they need support.”

Support Groups

Some individuals have seen a need to offer support services for both current and prospective female drivers. Those with experience in the trucking industry, like Wood, have seen the struggles women go through to get their Commercial Driver’s License, let alone actually getting a job as a paid driver.

“Only one in six women who attempt to get their CDL actually makes it,” Wood said.

She feels that many of these women fall through the cracks of the system and are kicked out for unfair reasons, like not passing dock loading tests due to lack of one-on-one training time. This is one of the main reasons she offers a free membership for female trucking students to her grassroots association, REAL Women in Trucking.

REAL Women in Trucking offers information for students about CDL testing and the trucking industry, as well as advice from experienced female CDL holders. For those with six months or less of truck driving experience, Wood offers virtual mentorship with follow-up phone calls through each step of the training and testing process, as well as an emergency crisis phone line.

“The numbers of women in the trucking industry are going up, but they could be even higher if women got the support they need to make it through CDL training as well as their first year of commercial driving,” Wood said.

For more information on REAL Women in Trucking, please visit www.realwomenintrucking.com.

Sources:

Federal Judge Rules Prime Trucking’s Same-Sex Training Policy Violates Federal Law, U.S. Equal Employment Opportunity Commission

More Women Showing Off Skills At National Truck Driving Championships, CBS Pittsburgh

Current Population Survey 1983-2002 and 2000-2012, U.S. Bureau of Labor Statistics

The U.S. Department of Transportation (DOT) recently announced it will allow Mexican carriers to apply for permission to conduct long-haul, cross-border trucking services in the United States.

Currently, Mexican drivers are not permitted to haul freight across the U.S. border. Shipments coming from Mexico are transloaded at the border, and an American truck driver hauls the freight to its final destination in the U.S. Now, with approval, Mexican carriers will be able to haul the freight all the way from Mexico to its American destination.

It is the federal government’s hope that this change will expand international trading opportunities for the nation and eliminate more than $2 billion in annual retaliatory tariffs on U.S. goods.

Initial Pilot Program

In order to test out this cross-border idea, the federal government rolled out a three-year pilot program for Mexican carriers, which concluded in October 2014.

The FMCSA reported that fifteen Mexican trucking companies enrolled in the pilot program. These carriers crossed the border more than 28,000 times and drove more than 1.5 million miles in the United States. During this time, more than 5,500 safety inspections were conducted by American officials.

The DOT concluded from the pilot program that Mexican carriers are able to comply with safety regulations just as well as carriers from the U.S. and Canada; therefore, the government could safely move forward with the cross-border carrier program.

Elimination of Retaliatory Tariffs

The U.S. is hoping to eliminate the retaliatory tariffs on trades with Mexico that arose due to a 2009 U.S. appropriations bill that sabotaged any chance at opening the American border to Mexican truck drivers. Since the cross-border pilot program’s debut in 2011, the Mexican government has suspended the tariffs. With the new cross-border program being instated, this could eliminate the tariffs altogether, which total over $2 billion annually.

The Beginning

As of January 15, the FMCSA has officially begun accepting applications for Mexican truck drivers to have the authority to operate their trucks on long-hauls across the Mexican-American border. This means that drivers without American licenses will be able to haul goods into the nation.

This new international driver program has received some heavy criticism from U.S. Representatives. Some, including Rep. DeFazio of Oregon, plan to use their legislative authority to put pressure on the FMCSA to take into consideration some problems that the open-border may cause. DeFazio claimed that the pilot cross-border program did not have enough participants to make a safe and fair decision.

For some, this also leads to concern about criminal activity. This program might seem to provide a golden opportunity for transporting illegal drugs across the border. However, the DOT has declared that their safety checks and regulations will prevent the crimes.

For supporters, especially U.S. agriculture shippers, this is an opportunity to lessen the truck driver shortage. Essentially, opening the borders to Mexican carriers will add drivers and truckload capacity for Americans as well.

The Impact            

With the U.S. facing a driver shortage estimated around 30,000, a new pool of drivers might not be such a bad idea. The DOT assures that Mexican drivers will not be taking American jobs; rather, they will be helping to fill the empty truck cabs that are unable to take on these long-haul moves. In turn, this frees up American carriers for in-state lanes.

This will also result in less handling of freight while it crosses the border, as a transload will no longer be required.

According to the U.S. Bureau of Transportation Statistics, trade by value shipped across the border rose 9.6 percent year over year to $34 billion in October. If the retaliatory tariffs are eliminated, this program could result in a major return for Americans and the U.S. economy.

Sources:

US Ag Shippers Applaud Truck Border-crossing Decision, JOC

FMCSA Officially Opens Authority Application Process for Mexican Carriers, Overdrive

Congress May Use Highway Bill to Challenge FMCSA’s Cross-border Expansion, Overdrive

As winter weather sets in for most of the country, you should take precautions to keep not only you and your truck safe, but also others on the road. We’ve put together ten useful tips to help you get your loads delivered safely this winter.

1. Monitor the weather

This one might seem really obvious, but knowing ahead of time that a storm is brewing is key to staying safe.  If a blizzard or wintery mix is predicted in your area, you can set into motion your plan of action for pickups and drop offs. Since weather predictions ahead of time can be faulty, don’t forget to stay tuned to the radio, radar maps, or the Weather Channel for information on real-time road conditions.

2. Plan your trip

Before getting on the road, take the time to plan and map out your route according to the weather. Take into consideration that some roads may be closed or too rough to navigate. If possible, plan the times you will be going over overpasses to be after the snow has melted, or at least, plowed. Calculate your driving speed for heavy snow weather to be about 25 mph and plan safe parking places and pick-up and delivery times accordingly. This way, you won’t be facing possible issues with your Hours of Service (HOS) before making it to a safe resting stop. Make sure to have a few alternate safe stops planned, just in case conditions get too bad in other places.

3. Check equipment pre-trip and mid-trip

It’s always vital to check your equipment before you hit the road, but especially so when winter weather strikes. Check that all lights are working properly, air is drained from the truck’s and trailer’s tanks to avoid frozen brake lines, and tire pressures to prevent a disastrous flat.

After hitting rough patches of snow or ice, make sure to make a safe stop to knock off tire flaps and undercarriages. This could prevent damage to your rig, but also other vehicles when the packed ice eventually comes off.

4. Have extra equipment on board

Be prepared for the iciest conditions by having some of the best snow gear on board. You should make sure to have:

5. Maintain as much space as possible

One of the most common factors in winter accidents is following too closely behind other vehicles. You may not be able to control the cars behind you, but you can do your best to make sure there is enough cushion space between you and the car ahead of you. This leaves you with options if your brakes aren’t working as quickly as they should.

6. Slow down

Put the posted speed limits into context. If roads are covered in snow or ice, it might not be safe or feasible to maintain that 50 mph speed limit. Going faster leaves more room for error with stopping the truck and trailer, as well as reduces your reaction time. Slow down and only go as fast as you are reasonably able to. Keep to the right and let other vehicles pass you if they want – don’t feel pressured to speed up if they are following too close behind. You are driving with everyone’s safety in mind when you go easy on the pedal. 

7. Know what to do if you lose traction

There’s no fool-proof method for not losing traction in bad weather. It’s important that you know what to do if it happens, since this lessens the severity of any possible accidents. The number one thing to remember: never use the clutch or engine brake when traction is lost, as this could make the situation worse. Just gently let your foot off the pedal and steer in the direction that the back end of the vehicle is going, which should allow you to then gain back control.

8. Be careful getting in and out of the truck

Again, this might seem obvious, but just remember that steps will most likely be slippery. It’s not unheard of for a driver to fall and seriously injure themselves by underestimating the condition of truck steps. Make sure to wear boots with good grip and take your time going up and down. Also, always keep in mind your surroundings. Take extra caution getting in and out of the tractor on roads with low visibility. Always wear an orange safety vest.

9. Hold your steeling wheel firmly and with confidence

Winter weather is not the time to be reaching for a snack or answering a text. Always keep your hands firmly on the wheel in case you hit a rough patch of snow, or need to react quickly to unforeseen conditions on the road. At the same time, be confident in your driving skills. Try to remain calm and avoid sporadic driving.

10. Know your and your vehicle’s limitations

There may come a point in which the weather simply makes the roads too unsafe to travel. Don’t push your luck if conditions are bad – yours and others’ lives are at the top of the priority list.  Take this time to make a safe stop and wait the storm out. Catch up on some rest to get back on the road as soon as possible.

You may have heard on the news recently that West Coast ports have been clogged, delaying the importation of international goods.  This is having an effect on both intermodal and truckload shipping. Here’s the lowdown on the problem and how it could affect you.

What’s going on?

West Coast ports, particularly those in California, have experienced slowdowns and delays on their docks. Ships are lining up at sea, waiting their turn to get in, as it’s taking longer to unload the cargo of each ship while it is in port.
Longshoremen (those who load and unload ships) are purposely taking their time with each ship, which forces the draymen (truck drivers who transport the cargo from the port to the rail) to sit idle. The draymen are getting paid less due to the longshoremen’s slowdown, which has led to them picketing at the ports. Dockworkers are walking out mid-shift in retaliation.
The culmination of all this: major port congestion that is crippling productivity and movement of goods across the U.S. You’re probably wondering why on earth this is happening.

What’s the cause?

Longshoremen are on strike due to the lack of salary negotiation on their contracts and refusal of the ports to recognize them as employees, not contractors.
This all started back on June 30th, when the last contract expired between the Pacific Maritime Association (PMA), which represents employers operating shipping lines and port terminals, and the International Longshore and Warehouse Union (ILWU). The two parties have yet to negotiate the next contract for the dockworkers, which would recognize workers as employees in order to receive certain benefits.
In the past five months, scrutinizing accusations have been thrown between the ILWU and the PMA. The ILWU claims that the PMA is refusing to negotiate the contracts and blaming its members for the port jamming in its entirety. In return, the PMA is accusing the ILWU of deliberately coaching its members to halt dock operations by conducting over-exaggerated inspections and working as slowly as possible.
The truth is that the ILWU is coordinating work slowdowns and additional inspections, which have caused productivity to plummet. So far, the ports that have been affected are The Southern California Region, Port of Seattle, Port of Tacoma, Yusen Terminal, Long Beach Container Terminal, APM Terminal, Seaside Transportation Services, and Total Terminals International.
Aside from all of the contract negotiation and labor issues going on, there were already problems affecting the ports prior to this. These include a higher volume of mega-ships (more cargo and longer wait times), chassis shortages, shortage of dray carriers, and a higher volume of shipments.

What’s the prognosis?

Recently, the National Retail Federation wrote a letter to President Obama, citing concern of a looming port shut-down if there was not intervention by a federal regulator to negotiate the dockworkers’ contracts. Obama responded by saying that the PMA and ILWU will work it out themselves in due time.
With that being said, no contracts have been negotiated yet. This could mean continued and worsened port delays and backups. The more that the ILWU backs the longshoremen’s strike, the more the draymen and drivers will picket, which increases the likelihood of an eventual port shutdown. This could create a domino effect, affecting imports on the East Coast as well.

What impact will this have on you?

In response to the congestion that is now affecting many of the West Coast ports, carriers are now tacking on surcharges to make up for the loss of profit due to the increasing time it takes to move and be unloaded. This could mean higher costs to get your shipment onto the rail, plus longer transit times overall.
Luckily, the Federal Maritime Commission (FMC) has been keeping a close eye on these shipping surcharges. Shipments that are already in-transit, or waiting to be unloaded, are not eligible to be assessed fees.
Even though the turmoil between workers, unions, and the PMA seems to be unrelenting, there are still options for getting your goods from the West Coast and distributed throughout the country. Trinity offers intermodal, truckload, and LTL services. You may need to rely on a different mode of transportation than you normally do. Depending on the lane, some of these modes may be temporarily more expensive or take longer than they usually would. We can be your trusted resource in determining the most cost-effective and logical way to move your freight during this turbulent time.
Rest assured that Trinity is staying informed on the port congestion issue as it unfolds, and our sales representatives will be able to provide you with the best avenue to keep your freight moving.
Sources:
“Labor strife threatens West Coast ports”, The Produce News
“Dozens of vessels heading to US West Coast ports face dock congestion”, JOC
“Shipping companies announce container surcharge at ports”, The Seattle Times

Do you find yourself with little space for inventory? Is a large chunk of your money tied up in stocking materials that aren’t needed yet? The just in time (JIT) supply chain model might be the best solution for your space and budget.

How does a JIT program work?

JIT is utilized as a means to protect profit and warehouse space in all types of industries, but especially in manufacturing and food production. This strategy can be used for the inbound delivery of raw materials, the outbound shipping of finished products, or both. The ultimate goal is to save money on inventory and storage costs by cutting (or completely eliminating) the amount that’s sitting on shelves or in the warehouse.

This model allows for goods or materials to only be delivered when they’re needed immediately, or “just in time”. While this makes for a constant drop-off and pick-up of products and materials, it lessens the amount of money and space invested in raw materials before they are needed in the manufacturing process, which frees up funds that might be needed elsewhere.

Why would a company choose JIT?

JIT became popular in the 1950’s and 1960’s, most notably in the car manufacturing industry. This allowed for vehicles to be made and put together piece by piece, without taking up huge amounts of space and money on parts that weren’t ready to be installed yet.

Toyota still works primarily off of this business and logistics model, but JIT can work especially well for smaller companies too. Those with limited space and funds between each stage of manufacturing, as well as those with large gaps of time between production and delivery, may want to consider switching to the JIT model.

If your business requires high value products to be stored, like metal, JIT might be a good fit. Since large amounts of inventory aren’t kept on hand, there is less time between manufacturing and shipping for products to be lost, damaged, or stolen.

Businesses with perishable goods should also look into converting to JIT. It’s important to keep expiration dates in mind when ordering products with a shelf life, and having them delivered only when and in the quantity needed, reduces waste and protects your bottom line.

The great thing about JIT is that it can be adjusted for times when business is either booming or slowing. Companies that see slow seasons could especially benefit, as the logistics ”spigot” can be turned down (or off completely) and you won’t be left with a wasted surplus. Essentially, if parts or stock aren’t needed, they don’t have to be ordered or delivered.

How can Trinity help me switch to JIT?

As a full-service 3rd party logistics provider (3PL), Trinity can assist with all stages of the transition into the JIT program. We can arrange the JIT shipments of both inbound materials and outbound product. Our network of over 30,000 certified carriers means that timely pickup and delivery are easy to arrange. If you need to switch to a smaller warehouse space to accommodate your new JIT plan, we also offer warehousing solutions.

Trinity offers extremely flexible and customizable supply chain services, so that if production is slow, we can slow down your shipments going in and out, or if you hit peak sales, we can get carriers moving to match your pace. Rest assured that all of our logistics and warehousing solutions are adjustable and streamlined to allow your time and energy to be most focused on your own business.

To request a consultation or more information about switching to a JIT program, click here!

With the U.S. economy strengthening, and industries booming, truck drivers are seeing some of the largest wage increases in years. As encouraging as it is for drivers to be seeing bigger paychecks, the reasoning behind the pay raises can’t be ignored: the nationwide truck driver shortage.

Why are truckers’ wages going up?

It’s no secret that truckload capacity has been tight lately. Truckers who were unable to afford the shortage of loads when the economy was suffering left the industry behind for jobs that allowed them to be closer to home. Not only that, but the tougher federal regulations introduced in 2013, which put tighter limits on driving hours, didn’t exactly persuade truckers to stay in the industry. That leaves about 35,000 spots unfilled, according to the American Trucking Associations (ATA).

Now that the economy is bouncing back and there is an increase in demand for goods, there is also a stronger need for getting those goods to market. A limited number of truck drivers and high demand from shippers leaves even some of the largest carriers in a scramble to get their unmanned trucks on the road.

With hundreds of trucks left idling and the average turnover rate for drivers with large carriers being just over 90%, fleet managers have had to make the driver’s seat look more appealing to potential truckers. The best way to get that message across is by fattening paychecks, as well as taking on licensing costs and offering signing bonuses. This means higher salaries for those who are left, but also those in the younger generations that need to make up for the 96,000 drivers leaving every year for retirement.  If carriers don’t take measures to boost hiring numbers, we will see a shortfall of 240,000 drivers by 2020, the ATA said.

Read our blog about truckload capacity to learn more.

What impact will this have on my supply chain?

So, here comes the bad news for shippers. Since carriers are upping their labor costs, they need to still protect their profit margin. In order to do this, they must raise their bottom lines – in turn, raising their rates.

Until the driver shortage flames have been put out, expect capacity to be tight and rates to be high.  There are still not enough drivers to cover the volume of loads needing to be shipped. Carriers are forced to turn down loads because of not having trucks available, and if they’re not turning them down because of capacity, they are hanging up because the rates offered are just too low.

How can I avoid the higher costs?

As long as you’re shipping truckload, rising rates are something you’re just going to have to factor into your budget. You will not be able to continue shipping at the same rates you locked in one year ago. This is the unpleasant truth.

However, there is an alternative.

If paying higher rates for truckload shipping is simply not an option, consider moving freight over the rail (intermodal).  Not only is intermodal usually cheaper than truckload, it’s environmentally friendly and can meet many of the requirements demanded in the truckload industry, like transporting reefer shipments in temperature controlled cars. However, its most appealing characteristic is the fact that it can offer plenty of capacity when trucks are hard to find for a reasonable price.

Just this year, intermodal volume for all of North America increased 5.7% to 13 million trailers and containers, according to the Association of American Railroads. Intermodal freight shipping is on the rise, and shouldn’t necessarily be your last option, because it’s easily becoming your best. Even if you only utilize intermodal shipping a few times a year, it could save you time, money, and stress.

Check out our blog about intermodal shipping to learn more.

Sources:

“ATA MC&E: Economy Improves, Driver Shortage Continues”, Truckinginfo
“Turnover at For-Hire Carriers Largely Unchanged During the First Quarter”, ATA
“Drivers Gain From Wage Race as Truckers Turn Away Cargo”, Bloomberg
“Expanding U.S. economy exposes rising truck driver shortage”, Reuters

When you get a rate for an LTL shipment, the cost is influenced by so many different factors that it’s actually pretty easy to make some simple changes and see your LTL shipping costs go down. While these tips may not be possible for everyone to implement, you’ll likely find at least one or two of them are relevant to your situation!

Let’s get right down to it.

Maximize the density of your shipment

A truck can only haul so much weight. LTL carriers make a profit by fitting as many different LTL shipments into one single trailer as possible. So which do you think they prefer… a 5,000lb shipment that takes up 25% of the space in the trailer, or a 5,000lb shipment that only takes up 10% of the space? The more space your shipment takes up in the trailer, the more you’ll be charged to ship it.

While the weight of your shipment is out of your control, the density is not! Do everything you can to compact your shipment and increase the density as much as possible. If your pallets are not stackable, find a way to make it so. Pack your product more densely (less empty space between cases or product on the pallet, if possible). Stack an extra row on top of each pallet to possibly eliminate an extra pallet. Brainstorm about all the ways to make your shipment take up less space, and you will definitely see a financial reward.

Consolidate your shipments

Shipping a full truckload of freight is often far less expensive than shipping multiple LTL shipments. Have you ever considered consolidating your LTL shipments into a multi-stop truckload shipment? Of course, it depends where your shipments are delivering – for example, a multi-stop truckload picking up in Maine and delivering in Florida, Minnesota, and California might not make financial sense compared to shipping LTL. But if your delivery points are close to each other, or if they form a line across the country (at least vaguely), getting a quote on a consolidated truckload shipment would be very wise.

Negotiate a FAK

Those of you who have not heard the term “FAK” are probably raising your eyebrows. “FAK” stands for “freight all kinds”. This literally refers to when a customer ships all kinds of freight. Let’s say you ship some products at class 50, some at class 55, some at 75, and some at 150. (If you have no idea what I’m talking about, go read this blog to learn about freight class.) Since your freight class impacts the cost of your LTL shipment, and getting a rate for different classes all the time can quickly become time-consuming and complicated, you actually have a different option here. We can negotiate a FAK on your behalf, which basically means you can ship all your LTL freight at the same class. Not only does this simplify things for you, it also typically results in cost savings!

Provide accurate information

Most shippers are painfully aware that the rate for shipping their LTL freight is highly dependent on the size and weight. For this reason, some people are tempted to slightly “underestimate” the dimensions or weight of their shipment in the hopes it will result in a slightly lower shipping cost and the LTL carrier will be none the wiser.

Whatever you do, DO NOT DO THIS! Rather than saving money, you’re putting yourself at risk of being fined. If the carrier happens to double check the dimensions or weight of your shipment, and it doesn’t match what’s on the BOL… let’s just say you’ll be in a world of trouble. Your shipment cost will be raised accordingly, but you’ll also be charged with an inspection fee, and it’s possible the carrier will red-flag your freight to be inspected every single time you ever ship with them in the future.

By ensuring the weight, size, and all other information listed on the bill of lading is accurate, you will not be risking these extra fees.

If you don’t ship at a high volume, work with a 3PL

If you ship a large amount of LTL freight, you can negotiate lower pricing with LTL carriers (or have a 3PL negotiate on your behalf). But what if you don’t ship LTL that often? Does that mean you’re stuck paying the highest rates every time you call up your LTL carrier of choice? If you work directly with LTL carriers, then yes, maybe. But a great alternative is to ship your LTL freight through a 3PL (like Trinity Logistics). Because of the high volume of freight that 3PLs arrange (all of their customers combined!) they will have the lower contracted rates available that you can take advantage of without having high volume of your own. This will result in a significant cost savings, especially over time.

SEAFORD, DE, September 11, 2014 – Trinity Logistics, a 3PL (third party logistics) provider headquartered in Seaford, DE, was named to two important lists this week: the 2014 Top 3PL and Cold Storage Provider list, published by Food Logistics magazine, and the Inc. 5000 list of fastest-growing privately-owned businesses in America.
Food Logistics, a publication dedicated exclusively to global supply chain solutions for the food and beverage industry, named Trinity to its 2014 Top 3PL & Cold Storage Providers list for 2014. This is the second year in a row that Trinity was chosen for the list. The Top 3PL & Cold Storage Providers serves as a resource directory of third-party logistics and cold storage providers whose products and services are critical for companies in the global food and beverage supply chain.
“Companies in the food industry and food packaging supply industry have always made up a huge portion of our customer base,” said Jeff Banning, Trinity Logistics’ President and CEO. “This has allowed us to become true experts in the area of dry and refrigerated food logistics, and we are dedicated to serving this important industry.”
“Our growing list of 3PLs and cold storage providers indicates how important these two segments are to the food industry and the level of expertise and services required to support today’s growers and processors, shippers, and grocery retailers,” noted Lara L. Sowinski, editor-in-chief for Food Logistics. “Assuring a safe and secure global food supply chain is paramount. In addition, reducing food waste, managing fuel and energy costs, and responding to new demands related to omnichannel retailing are just some of the expectations the food industry has of their 3PL and cold storage providers.”
It was also announced this week that Trinity Logistics was named to the Inc. 5000 list of fastest-growing privately-owned businesses in America. This is the fifth time that Trinity has been featured on the Inc. 5000 list. Companies are ranked based on their rate of growth over the previous three year period. Trinity experienced 75% growth over the past three years.
“Our company culture focuses on growth – we invest in the personal growth of our team members, and that’s what leads our company to grow overall,” Banning said. “Being featured on the Inc. 5000 list for the fifth time is a direct reflection of that commitment.”