Less-than-truckload (LTL) shipping strategies have become essential for ensuring timely deliveries without breaking the bank for shippers or passing costs onto consumers. Letting shippers pay only for partial truck space, optimizing cargo utilization in trucks, and reducing shipping expenses for smaller loads ultimately benefits the entire supply chain, streamlining operations and enabling more competitive pricing. What’s more, having multiple shipments from different customers onto a single truck is key to curbing carbon emissions and meeting sustainability goals.
Still, the many moving parts and complex nature of this distribution strategy make it difficult to secure the most cost-effective LTL shipping rates. Here’s what it takes to get the best LTL quotes.
7 Tips for Finding the Best LTL Shipping Rates
Optimizing your LTL shipping rates requires a multi-pronged approach that involves improving both internal efficiency and external carrier relationships. Start with these six strategies:
Optimize Packaging
When shippers take care to select durable and space-efficient packaging materials, they can better protect goods during transit while maximizing space utilization within shipping containers or pallets. Reducing damage rates decreases the number of customer returns, further saving on shipping costs.
Choose the Right Freight Class
The National Motor Freight Classification (NMFC)®️ system helps carriers define standard rates for goods by categorizing them based on parameters like density, liability, and handling requirements of the goods being shipped. It’s critical for shippers to carefully measure each of these factors to choose the right class. This avoids both overpaying for unnecessary services and higher freight class assignments or underpaying and facing a surprise charge from the carrier once they’ve processed a package. Improving the accuracy of freight class selection upfront can make a dramatic difference in LTL shipping rates for operations that have been careless about it in the past.
Negotiate Volume Discounts
Carriers prioritize steady revenue streams to improve their financial planning, so shippers can leverage their expected shipping volume and frequency within a region as a bargaining point in future contract negotiations. By committing to consistent shipping volumes, it positions shippers to argue for volume discounts that lead to lower rates per unit or other cost-saving benefits, resulting in overall better LTL shipping rates and lower logistics costs.
Track Carrier Performance
Another strategy for securing better carrier rates is to gather hard data about carrier performance, which is useful for both overall selection and positioning for more favorable contract terms. Tracking carrier performance metrics like on-time delivery rates, transit times, and customer service response times allows shippers to assess the reliability and service quality of each carrier. In turn, shippers can leverage this insight as criteria for selecting better-performing and more cost-effective carriers, or to negotiate better agreements with existing carriers.
Utilize Regional Carriers
When shipping in specific geographic areas or smaller regions, leveraging smaller and local carriers is an easy way to reduce LTL shipping rates — but it might require more research and planning. Regional carriers often offer more competitive rates and faster transit times compared to large national carriers who justify larger rates with their market share and the convenience factor. In fact, compared to UPS and FedEx, some regional carriers can save customers as much as 40%. However, switching to regional carriers when possible can both reduce costs and improve delivery efficiency.
Explore Intermodal Shipping Options
Intermodal shipping options that spread shipments across rail, trucking, and other modes of transport can generate significant savings, particularly for long-distance shipments and for shipments without stringent transit times. As long as coordinators can leverage the strengths of each mode to optimize routes, it’s possible to significantly reduce shipping costs per unit, and even improve other metrics like delivery times.
Optimize Carrier Selection With Rate Shopping or Spot Market
Rate shopping for contract LTL rates and utilizing spot market LTL rates are two of the most effective strategies for optimizing carrier selection in logistics. Comparing contracted rates in real time, allows shippers to ensure they are leveraging the best long-term deals available. Coordinators can also explore the spot market to capitalize on lower rates that may arise due to market fluctuations — especially beneficial for shipments that are less time-sensitive. These complementary approaches allow companies to strategically navigate carrier options, enhancing both cost efficiency and adaptability in their supply chains.
Secure the Best LTL Shipping Rates With 3G Transportation Software
All of these strategies can help shippers significantly reduce LTL shipping rates, but it’s still a matter of allocating the time and resources to manage them effectively. Transportation solutions like the 3G software suite can help users automate most of the labor-intensive aspects of securing better shipping rates. 3G even connects users to a proprietary and up-to-date carrier network of trusted providers, with fully visible rate and capacity data to streamline planning and coordination.
Want to experience the difference 3G can make for your LTL shipping rates? Schedule a demo of the platform today.
