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Originally Posted On: https://atslogistics.com/what-to-consider-when-getting-a-freight-shipping-quote/
COVID-19. Shipping regulations. Travel congestions. Unbalanced global recovery. High demand for shipping avenues.
You can name your reason, but one way or another, higher shipping costs are here to stay.
That does not mean that your business is implicitly priced out. It just means you have to understand how your freight shipping quote works and how to achieve the most cost-effective outcome. Here’s what you need to consider when you get a freight shipping quote.
How Shipping Quotes Work
A freight quote is an estimate of your shipping cost based on the details of the job, just like any other type of quote. It’s based on things like:
- Pickup location
- Delivery location
- Commodity type
Most shippers will get their quote from one of two services:
- Carrier
- Third-party logistics (3PL)
A freight carrier physically transports your freight from Point A to Point B. A third party logistics company (3PL) is considered the middleman between the customers and the carriers. They handle everything for each customer and offer several different transportation solutions to successfully ship your cargo. Think of a carrier as one part of the service you get from a 3PL.Here’s what you get from each quote.
Freight Carrier
A freight carrier is a company that the owns trucks, trains, airplanes, or cargo ships that transport your products from the origin to the destination. Your freight quote will vary depending on which mode of transportation you choose to move your freight. For example, LTL and truckload charges are going to have different prices as are the other modes of transportation due to the difference in commodities and the uses for them.
You should also make sure you have a crystal clear understanding of the services each carrier offers—and what services you need. When in doubt, ask your carrier representative to talk you through the various services and line items. You should come into the conversation with an idea of the services you need. That way, you’ll be able to identify if the carrier is the right fit.
3PL
When you’re working with a 3PL, you’ll have more options when shipping your freight than a carrier may have. Unlike a carrier, a 3PL takes care of all of your shipping requirements for you, from negotiations to customs clearance, and can pick from a network of multiple carriers. For example, a 3PL can offer services such as TL, LTL, international, ocean, air, rail, warehousing, government, expedited, and many more!
A 3PL will provide a unique freight quote that will include any services and needs put together specifically for each shipment. This is a good choice for shippers who need a variety of available services as well as any single, limited service. At a 3PL you will have a logistics coordinator that is an expert on the market and the services needed to ship anything successfully and efficiently.
What Goes into Freight Quote?
While your choice of a logistics company has a significant influence on your shipping costs, there are some aspects of your shipment that can affect the final cost no matter who you choose to partner with. If you understand the different parts of a quote in advance, you can better account for the shipping rates for your shipment.
Here are a few of the big ones.
Freight Class
Every LTL shipment falls within one of 18 classes established in the National Motor Freight Classification book published by the National Motor Traffic Association. The freight class is determined by:
- Density
- Handling
- Stow-ability
- Liability
The freight classes vary widely and are determined by commodity type. Class 50, for example, is durable freight that fits on a standard 4 x 4 pallet and weighs 50 or more pounds per cubic foot. Class 500, on the other hand, covers exactly two items: gold dust and ping pong balls. In simple terms, the lower the freight class number, the lower the shipping cost.
Keep in mind that every commodity has both a freight class and an NMFC code. Freight class refers to the commodity category, while the NMFC code covers the commodities within each class. Bricks and steel pipes would both be freight class 50, but they have different NMFC codes.
Distance
Another major factor is distance. Basically, the more miles your freight accumulates, the more expensive it is.
Regional carriers typically serve a specific area. If they have to ship outside that area, they recruit a shipping partner who services that ZIP code. That’s called interlining, and it eats any discounts you might otherwise receive.
Destination Type
Did you know that shipping to a church may get you different shipping costs than a school? In fact, any of the following destinations may raise your shipping costs:
- Schools
- Churches
- Military installations
- Farms
- Fairgrounds
- Construction sites
- Commercial areas not open to the public
- Storage units
Your freight broker has to consider the amount of time spent at the final delivery site, the conditions required to reach it, and the difficulty of reaching the site. Basically, the harder it is to deliver with a quick turnaround, the more expensive it is.
The Third-Party Logistics Partner You Need to Succeed
As you can see, a freight shipping quote isn’t so much a price tag as a conglomerate price based on a unique combination of factors for your specific freight item. The key is finding the right freight partner for the job.
That’s where we come in. We offer comprehensive shipping services, from LTL logistics to expedited freight to warehousing. Whatever you need to get your freight from Point A to Point B, we’ve got you covered.
So if you need something shipped, get in touch today to find out how we can help your freight get where it needs to go.
