LTL carriers can significantly impact a company’s bottom-line profitability. Whether it’s a small business or a large enterprise, studying the concepts of negotiating with Less-than-Truckload carriers is highly valuable. LTL carriers can offer cost-effective shipping solutions over full truckload shipping. Learn how to leverage these providers effectively and negotiate better rates. Here are some tips for rate negotiating better rates with LTL carriers.
Tips for Negotiating Better Rates with LTL Carriers
Understand Your Shipping Needs
Unpack your shipping needs prior to the negotiations. Examine your shipping data and find patterns in the most used shipping methods, weight, and volume.
That background strength sketches a clear picture of your business during the negotiations. Knowing your needs will help you assess which carriers best fit your business model and needs for:
- Specific delivery times
- Origin and destination
- Additional services
- Freight Classification
Research Carrier Options
Not all LTL carriers are created equal. Each carrier will have its strengths and weaknesses, as well as those serving specialty niches. Research top-rated LTL carriers near you. Learn more about their service offerings and coverage area, and take the time to read through the customer reviews.
This research identifies carriers that match your potential shipping needs. You can use this information to your advantage when negotiating LTL shipping rates. It offers the flexibility to bring in alternative carrier options and allows you to use competing offers as leverage.
Build Relationships with Carriers
Be sure to build relationships with carriers. Developing a good rapport with your account representative has the potential for better terms and service. Regular communication and a good working relationship make your carriers willing to accommodate you with better rates.
LTL shipment carriers are more willing to give better rates to companies they feel appreciate them. Establishing this balance can lead to the company’s commitment to a great rate.
Leverage Volume and Commitment
Utilize your shipping volume and commitment to get better rates from LTL carriers. With a volume commitment, there’s room for negotiation. Show regular volume patterns and commit to using a certain carrier for the long run. Carriers like guaranteed business and are often quite open to providing discounts on rates based on volume commitments.
LTL Carriers Better Rates With Consolidated Shipments
Consolidate shipments to save money and receive better rates with LTL carriers. Turn many smaller shipments into bigger ones and lessen the aggregate volume in your shipments.
The company benefits from better rates through higher volumes. This is a win-win situation. Work with your carrier to determine these opportunities with a third-party logistics provider.
You can also create a proper distribution strategy inside the company. Consolidated trailer space saves costs, makes processes more efficient, and reduces damage risk in transit.
Negotiate Supplemental Charges
Supplemental charges are usually significant expenses involved in shipping. These services can include:
- Lift-gate Delivery
- Residential Delivery
- Extra Labor
- Transit Time
- Fuel Surcharges
- Freight Class
Address these charges during negotiations and try to reduce or eliminate them. Fuel prices are constantly changing, and they can be common and costly. Carriers should urge you to get a detailed description of accessorial charges. This aids in negotiating for lower LTL freight rates, fees, or outright waivers.
Use Freight Brokers
Freight brokers can be key allies in getting great rates from LTL carriers. Brokers maintain relationships with multiple carriers, and their wide net of providers gives them the pricing power to negotiate excellent rates.
This understanding of the procedures and their industry experience allow them to secure a competitive rate, and save their clients time and effort in negotiations.
Compare and Benchmark Rates
Compare and benchmark the rates from different carriers to find the best deal. Utilize online tools for rate comparisons between freight providers to get more information on market rates.
Benchmark your current rates against the industry standard to determine if they are competitive. Use it as leverage in negotiations to secure better terms with your carriers.
Be Transparent and Honest
Communicate your business’s shipping needs, including volumes and expectations. The more transparent you are with your needs and limitations, the more trust you build with the carrier.
The more productive the foundation of the negotiations, the more advantageous it is to both parties. Carriers like to do business openly with customers and will give you the best rates if you are willing to work with them. They need to understand your needs.
Building Long-Term Partnerships Result in Better LTL Carrier Rates
Focus on building long-term relationships with your carriers rather than arguing over short-term savings. Long-term relationships lead to stable rates and better overall value, which, in turn, leads to increased service levels, competitive rates, and priority services.
Cannonball Express Transportation
Cannonball Express Shipping Company has been providing top-of-the-line service at a reasonable rate. Based in Omaha, Nebraska, we provide nationwide refrigerated LTL services, as well as, local delivery services. Contact us today!
Nationwide Shipping Company Services:
- Refrigerated LTL deliveries in the lower 48 states
- Refrigerated Cross dock
Local Shipping Company Services:
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- Redelivery Services
- Truckload & LTL Capabilities
- PUP
- Cross dock
- Transload
- Warehouse and Distribution capabilities from multiple Omaha Locations