the PartnerShip Connection blog
the PartnerShip Connection blog
the PartnerShip Connection blog
the PartnerShip Connection blog
the PartnerShip Connection blog
What are Accessorial Charges? A Guide to LTL Freight Fees
04/27/2023 — Leah Palnik
No one likes surprise fees. Unfortunately, there are quite a few extra costs that are likely to pop up with LTL freight. Known as accessorial fees, these charges cover a wide variety of extra services and can add up fast. In this post, we'll answer the question, "what are accessorial charges?" and provide a list of common LTL accessorial fees to help you better understand and manage your freight costs.
What are accessorial charges?
Accessorial charges are fees for services performed by the carrier that are considered to be beyond the standard pickup and delivery. These fees make up just one part of your freight rate, but can be challenging to manage. Understanding which accessorial charges you can plan for and which ones you can avoid is necessary if you want to keep your freight costs in check.
What are some common LTL accessorial charges?
You might be wondering what is considered an extra service, and you’re not alone. We’ve compiled some common LTL accessorial fees so you know what to look out for.
- Lift Gate Service
When the shipping or receiving address does not have a loading dock, manual loading or unloading is necessary. A lift gate is a platform at the back of certain trucks that can raise and lower a shipment from the ground to the truck. Having this feature on trucks requires additional investment by an LTL carrier, hence the additional fee.
- Residential Service
Carriers define a business zone as a location that opens and closes to the public at set times every day. If you are a business located in a residential zone (among personal homes or dwellings), or are shipping to or from a residence, the carrier may charge an additional residential fee due to complexity in navigating these non-business areas.
- Collect On Delivery (COD)
A shipment for which the transportation provider is responsible for collecting the sale price of the goods shipped before delivery. The additional administration required for this type of shipment necessitates an additional fee to cover the carrier's cost.
Shipments containing articles greater than or equal to twelve feet in length. Since these shipments take up more floor space on the trailer, additional fees often apply.
- Fuel Surcharge
An extra charge imposed by the carriers due to the excessive costs for diesel gas. The charge is a percentage that is normally based upon the Diesel Fuel Index by the U.S. Energy Information Administration.
- Inside Pick Up/Inside Delivery
If the driver is required to go inside (beyond the front door or loading dock) to pick up or deliver your shipment, instead of remaining at the dock or truck, additional fees will be charged because of the additional driver time needed for this service.
- Advance Notification
This fee is charged when the carrier is required to notify the consignee before making a delivery.
- Limited Access Pickup or Delivery
This fee covers the additional costs required to make pickups or deliveries at locations with limited access such as schools, military bases, prisons, or government buildings.
- Reweigh and Reclassification
Since weight and freight class determine shipment base rates, carriers want to make sure the information on the BOL is accurate. If the carrier inspects a shipment and it does not match what was listed, they will charge this fee along with the difference.
Navigating the many nuances of LTL freight accessorial fees to determine which services you need and which you can avoid will help ensure the most cost effective price. Carriers generally publish a document called the "Rules Tariff 100" which provides a list of current accessorial services and fees. The shipping experts at PartnerShip are well versed in these documents and are happy to help with any questions you may have.
Want a more in-depth look into freight accessorial fees and how to avoid or offset the added costs? Check out our free white paper!
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- Lift Gate Service
5 Hard Truths About Freight Quotes
03/27/2023 — Jen Deming
LTL freight quotes can be tricky and are often full of surprises - which isn't exactly fun when invoices are involved. Even experienced freight shippers may encounter some stumbling blocks, so it's essential to stay on top of the factors that impact your quote. From lead times to accessorial fees, we are breaking down five brutal realities about freight quotes that you must know to ship successfully.
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Your One Week Action Plan to Lower Manufacturing Shipping Costs
03/09/2023 — Jen Deming
Right now, the manufacturing industry is tough. Our economy is unpredictable, and both labor and raw materials expenses are high. When looking for cost-saving opportunities, it’s critical that manufacturers assess areas of the business where you may have the greatest degree of control, such as shipping. With a little bit of planning, your team can tackle one cost-saving strategy a day to ensure lower freight charges within a work week.
Day 1 - Audit your top freight classes
Freight classification is an important part of LTL shipping, and it’s important to make sure the ones you are using are accurate. If they are incorrect, your freight may be reclassified and you will pay a fee, which is both expensive and disruptive.
Make sure your team is reviewing your most commonly used freight classes and checking them against current NMFTA codes. Manufacturers have an extra challenge due to the sheer volume of materials being shipped, often within one load. Product classes for items like parts, tools, or built-machinery can vary wildly, especially if they fall within a density-based category. Codes are updated regularly, so you can’t just look it up once and think you’re good to go on every shipment you move. Even small changes in weight, dimensions, or packaging type can affect your class and freight charges.
You should regularly audit your freight invoices for discrepancies between what class you’ve used to quote and what shows up on your final bill. If you see any class codes that are regularly corrected, make sure you’re adjusting that for the future. For new products, always review resources like ClassIT or speak with an experienced freight professional who can help you decode your freight class.
Day 2 - Optimize your packing strategies
The way you approach packing procedures for your freight shipments can greatly affect your shipping costs. Palletizing your loads keeps your products together and improves the structural integrity of your shipment as it travels through the LTL network. Being intentional in your packing choices keeps freight charges under control by managing density and protecting against damages.
Take a look at your current pallet-stacking strategies to see where you can make positive changes. You may be able to improve density by adjusting which products you are grouping together on a pallet. Small, dense shipments typically have a lower freight class, so don’t overstack pallets with large, lightweight materials. Your team should also review how often you are losing money due to loss or damaged shipments.
Manufacturers have options to better protect freight with a few specific tweaks, like using custom crates for extra fragile loads or using recycled-plastic pallets instead of wood. Recycled-plastics pallets are sturdier and more durable than wood, and are also less likely to break over repeated trips. For any pallet type, you can also add shrink wrap or corner protection for additional security. Prevention is the best strategy when it comes to lowering damage costs.
Day 3 - Look for ways to consolidate
When it comes to spending less on freight, consolidating shipments is an area many manufacturers may overlook. By finding opportunities to ship more efficiently, you can greatly lower costs. One way to do this is to make the most out of every load by eliminating the extra ones.
Review your inbound order cycles for items like parts or tools that you need to regularly replace or service. Plan these orders ahead of time so they can be shipped at the same time to save money. Discuss any opportunities to combine orders with your customers who ship most frequently. For example, if you’re shipping product components monthly, review if the order amount can be adjusted and sent quarterly. Strategies like this may lower costs for you and improve efficiency for both parties in the long run.
Day 4 - Evaluate opportunities to limit accessorials
Freight charges can quickly add up when you overspend on extra services. Accessorial fees like liftgates or driver assist can be avoided if your team has the proper loading equipment. The real struggle starts when you’re hit with fees at your customers’ locations that you didn’t budget for. Make sure that your customer knows any extra help with loading or specialized equipment costs extra. Requests like these need to be made early on so that you can accurately build freight charges into your customer orders.
Manufacturers shipping to rural areas have a higher risk than other shippers of incurring less common accessorial fees. Put simply, limited access is applied whenever a location is tough to get to or has unusual business hours. Manufacturers within the agriculture industry who are shipping equipment to rural dealer locations or farms experience this charge most often. Do your homework and make sure you’re familiar with your customers' needs.
Day 5 - Get a freight shipping audit from a quality broker
Freight charges can be complicated and time consuming to manage, making it hard to become an expert in LTL when tackling other areas of business. Fortunately, freight brokers can help look for cost savings and inefficiencies by reviewing current freight invoices. At PartnerShip, we understand the difficulty manufacturers face when trying to save on freight, and our experts can help you look for opportunities that can save time and money.
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3 LTL Freight Fees That Are Actually Worth Your Money
01/19/2023 — Jen Deming
Keeping shipping costs low should be a goal for any LTL freight shipper, and is a smart tactic to successfully manage business expenses. What you may not know is that there are some scenarios where spending a little bit more can actually be beneficial. In certain cases, paying extra for an LTL freight fee may help avoid headaches, improve service, and create more efficiency. Let’s take a look at three scenarios where the fee is worth the extra cost.
Spend on: Freight Insurance
Probably the most important added fee that is worth the cost is extra freight insurance. The fact is that despite your best intentions (and packing procedures), your freight will at some point encounter damages and loss. Thinking that you’re safe with a claim payout from the carrier will lead to trouble.
We hate to break it to you, but payouts are usually pretty low, and don’t often approach the actual value of your shipment. The process is slow, tedious, and complicated - it's very easy to make a misstep that can jeopardize the approval of the claim. If you do acquire approval, your payout is based on dollar per pound and freight class, which can complicate things. Lower freight classes typically have lower dollar per pound payouts, so a discrepancy between actual shipment value can make it challenging to recoup your losses. Other freight classes, especially those that include used items, may not be covered at all.
Freight insurance usually comes at nominal cost with major extra coverage. The payout is based on the actual value of your freight, and you won’t have the responsibility of proving that it was the carrier that caused damage to your shipment. You also won’t be so hard-pressed for time in submitting a claim, and your payout will be faster. A quality broker should offer options to add on insurance coverage to your loads. When requesting a quote, just make sure to mention that you’re interested in additional coverage - for a minimal fee, you should be protected.
Spend on: Special Services
It’s always a smart idea to make sure your warehouse is well-stocked with proper loading equipment, and that your staff is adequately trained. But, sometimes you simply don’t have the resources.
Shipping locations without docks, small teams with low staff, and limited access businesses or special loads all warrant the extra money. Carriers offer a slew of extra services that cost money, but can be a life-saver depending on what you need to safely move your load. Liftgates, refrigerated trucks, and conestogas all fall into this category. You can also request driver assistance with loadings or delivery. While this isn’t a typical responsibility for the driver, if you’re willing to pay a little more, you can secure the extra help.
The most important thing about adding on these premium services is planning for the extra cost so that your invoice isn’t a surprise. Make sure you quote accurately, and include any additional options at the time of your request. If you’re unsure whether something may come with a hefty price tag, consult your broker or the carrier directly - especially since these services usually vary in cost across carriers.
Spend on: Carrier Appointments
Certain types of businesses require very specific shipping procedures and protocols. This happens often with high volume shippers that have trucks arriving all day long. These businesses frequently require appointments for delivery and pick-up. Grocers like Whole Foods or Trader Joe’s, and mass box stores such as Walmart and Target fit into these categories. Appointments help curtail truck pile-up and keep perishable goods stable.
Some businesses are designated as limited access, and may also operate within restricted shipping hours, like schools, universities, prisons, churches, or construction sites. Appointments can help ensure arrivals fall within that open window and avoid unexpected deliveries that may disrupt business operations or cause scheduling issues.
Neglecting to follow any business’s shipping and receiving protocols may result in a driver being sent away, which will likely incur missed appointment or redelivery fees. If you are shipping fresh produce and other perishable goods, any major delays are disastrous, resulting in damages to the load. Make sure you know whether or not your load will require appointments, and schedule them in a timely manner. Be extra mindful of any new locations you may be working with, and make sure any changes are communicated between all shipping parties.
Don’t be afraid to spend when the circumstances are right
It’s important to be budget-minded, but the most successful shippers know when to shell out versus when to save. If you need freight insurance, special services, or appointments for arrival, it makes sense to pay just a bit more to ensure less headaches down the line. These extra services ultimately help your freight - but you need a plan. PartnerShip can help determine which “extras” make the most sense for your business.
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3 Warning Signs Your Business Needs a Freight Broker
06/14/2022 — Jen Deming
Managing your growing business can present some unique challenges. On one hand, orders are coming in, your sales are increasing, and your customer base is thriving. The flipside to that success, however, may mean new operational issues that eat up your time and bottom line.
Shipping freight successfully during this growth period is a stumbling block for many business owners and logistics teams. You may find yourself needing more time and a larger workforce – at some point you may even wonder whether it’s time to outsource help. A freight broker can help manage many of your freight challenges, from overarching issues like lowering costs to tackling day-to-day issues like ensuring delivery accuracy. The bottom line is that you shouldn’t be stressing out more than enjoying the success of your business. If you’re experiencing any of these three signs your business needs a freight broker, it’s time to get the help from the experts .
Warning Sign #1 – You are making big mistakes when shipping orders
More sales is something to celebrate, but trying to keep up with the increase in orders without accommodating the volume is impossible. To make matters worse, packing and shipping is a very detail-oriented business, and rushing to get orders out quickly means an increased chance for error. There’s plenty of opportunity for mistakes that can snowball quickly.
Issues such as labeling or paperwork inaccuracies or even quoting errors can quickly escalate and create major problems. For example, something as simple as a wrong address on your freight shipment can, at best, cause delays. That means inconvenienced and aggravated customers. If your customer is paying for shipping, and you’ve quoted the cost incorrectly, you can’t go back and ask for more money – that’s your loss. You need to make sure you’re quoting freight accurately the first time by using exact details and the correct classification.
Mistakes like these cost you time and money, as well as customer satisfaction, which is pivotal when you’re a growing business. If you’re seeing shipping errors like those mentioned above, it’s definitely a sign that your business would benefit from a freight broker. A quality freight broker has a dedicated staff of freight experts who can help offer advice and resources on how to tackle the details that trip up many freight shippers.
A great freight professional can help you avoid mistakes by assisting with every step of the freight shipping process:
- Offer guidance on product classification and freight NMFC codes
- Collect competitive and accurate quotes from carriers who fit your needs
- Create necessary paperwork for delivery
Warning Sign #2 – Your billing department is becoming overwhelmed
Unless you’re an established, larger-sized business, it’s likely that your employees are juggling several different responsibilities. It’s not uncommon for a business owner to be playing the part of shipping manager and billing specialist to boot. Being burnt out and behind schedule is a pretty clear warning sign your business needs some help from a freight broker.
When your business is growing, it’s safe to say your shipment volume is increasing, and you may even be shipping with several different carriers or using a variety of services. Managing all of these invoices can be overwhelming, especially when you’re checking for accuracy, meeting payment due dates, and processing claims.
A freight broker can help simplify the billing process for your freight shipments by acting as an extension of your own team. Most will offer consolidated invoicing which can help cut down on billing chaos. You’ll also benefit from auditing services to double check for errors and savings opportunities. Should you experience damages, your broker can act as your advocate and help navigate the very particular requirements for filing your claim. Relying on these services can help shoulder some of the responsibility that your business just may not have the time or resources to do thoroughly on its own.
Warning Sign #3 – Your shipping costs are digging into your bottom line
Let’s face it, running a business is expensive, and while more customers mean a greater chance at making a profit, it can also mean that your shipping budget needs to increase. Between packing materials, labor, and freight transportation, these expenses can multiply quickly.
It’s key to make sure your freight rates make sense for your growing business. This can be done through carrier discounts and other means like order consolidation or taking a look at what types of LTL service providers work best for your business. Securing discounts and identifying savings opportunities can be challenging, especially if you’re not running a large corporation or shipping huge volumes of freight daily.
The great news is that through established carrier relationships and collective buying power, working with a broker can give your business access to higher freight discounts that are typically reserved for higher volume shippers. A quality freight broker will also a conduct cost savings analysis for your business to see where you are overspending on both inbound and outbound shipments. Lastly, they can also quote and compare among carriers to make sure you’re getting competitive pricing to help combat the current freight market.
Let us help you
Everyone wants to see their business grow and succeed, but keep in mind that as you do, new challenges will arise along the way. If you’re encountering major freight shipping issues like quoting inaccuracies, invoicing headaches, or rising costs, managing on your own may have run its course. These mistakes are signs that working with a broker may benefit your business, and PartnerShip can help get you started.
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Freight Quote vs. Invoice: Why Don’t They Match?
08/13/2021 — Jen Deming
One of the most common questions we get is from customers wondering why the heck their final freight invoice doesn’t match the rate they were originally quoted. It’s a valid concern because once you have that bill, it’s next to impossible to get more money from your customer and you’re going to be eating that cost. Your knee-jerk reaction may be to blame the carrier, but the real reason they are different may sting a bit – it’s usually a shipper error. Before you start pointing fingers, review these common reasons your bill doesn’t match that original quote.
Reason 1: Your product is classed incorrectly
One of the most common reasons a quote differs from a final bill is because your product is classed incorrectly. With classification being a huge factor affecting your freight quote, even a small error can impact your price. If you guess or miscalculate, your class may be way off.
The issue may be that sometimes your product is difficult to fit in a particular NMFC category. Take glass jars for example. This type of product falls under NMFC code 87700. It’s not as simple as that, however. Because glass jars are typically fragile, they are broken down by volume, and depending on that calculation, the class can be anywhere from class 65 to 400. In an average freight shipment, that’s a difference of hundreds of dollars. Make sure you are utilizing ClassIT, and consulting freight experts if you have any questions on class, or how to properly calculate density.
Reason 2: A liftgate service inflated your bill
When checking your freight quote vs. invoice, unexpected extra services are the second most common reason for a mismatch. One example we see time after time is for liftgate service. If you didn’t specify you would need a liftgate when you got your quote, but then your carrier provides the service at pick-up, it will cost you. Additionally, if your customer doesn’t communicate they need one for delivery, that can be added on without your approval or knowledge, surprising you once you get the bill.
Communication between both parties and ensuring you have the proper equipment can avoid this completely. Make sure you both understand that the added cost of an accessorial may raise your rate, but will help your shipment get where it needs to. Understanding that these types of special trucks equipped with liftgates are not as common, both parties will know they need to be requested on the front-side.
Reason 3: Too much time has passed
First and foremost, it’s important to know that a freight quote is an estimate to begin with.
So many factors can change - for example, fuel costs fluctuate frequently. Additionally, depending on when you are scheduling your shipment, peak periods can cause capacity issues, and this generally results in higher charges.
As a general rule, we like to inform our customers that quotes for standard LTL service are valid for about a week. That window is even tighter when you’re using time-critical services. If you’re wanting an estimate so you know what to bill a customer, build in some room for your final cost, or requote as close to the actual shipment pick-up date as possible.
Reason 4: Your delivery location has changed
While not quite as common, sometimes a change in delivery address can affect the final cost of your freight. Changes may occur after a load is quoted or may have to be made while the shipment is already in transit. Reasons for this might include a location being closed, or a consignee that isn’t ready to receive the shipment.
LTL freight shipments can be rerouted, but that adjustment will definitely incur costs: distance and fuel will increase if the location is further out. On top of that, special service fees such as a redelivery charge or even location-specific fees like limited access could also be applied. Do your best to requote if any details of your delivery location change. If the change is made at the request of your customer, be sure to communicate that fees will apply. If you want to absorb those charges as a courtesy, be sure to build some room in your customer cost to begin with. Otherwise, make it clear who is responsible for those fees.
Reason 5: The wrong carrier picked up your shipment
You’d be surprised, but the wrong freight carrier picking up an LTL load happens much more often than you’d think. We’ve seen customers quote a general rate with one carrier and then hand it off to whatever carrier arrives that day just to get it on the road and off the dock. Your shipping department is likely very busy, but this sort of simple mistake can cost you so much time and money in the long run.
Not every LTL carrier has the same base pricing, and even accessorial costs fluctuate between carriers.
If you quote with one carrier, and hand it off to another, you could be paying much more if that carrier charges more for their services. Even worse, if you have negotiated pricing with one carrier, the incorrect one won’t know to bill using your discounts. Worst case scenario, you may be billed at full-cost. Make sure your warehouse team is aware of what carriers are to move which loads. Creating color coded carrier labels and marking your shipments can help ensure a quick once-over to avoid this drama completely.
Reason 6: You have a paperwork error that affects billing
When comparing your freight quote to your invoice, also take a look at your paperwork and shipping documents. Billing errors and missing information can create an expensive and exhausting headache.
If you are arranging a shipment, and have special pricing or are using a third-party, make sure an accurate BOL states the correct carrier and “bill-to” party. If you are receiving the load, but responsible for the shipping arrangements, don’t leave it to the shipper to create the BOL. In doing so, you run the risk of an incorrect billing party or other inaccuracies that mean your discounts won’t be applied. Even after the fact, a letter of authorization (LOA) can sometimes fix this by informing a carrier of the correct billing party, but it’s not guaranteed and it definitely delays the process.
Don’t freak out if you’re seeing some discrepancies between your freight quote vs. your invoice. While they can be unexpected and troublesome, educating yourself and your customer about what can change your rate can help you make better decisions when planning your LTL load. Strong communication and a plan of action can help mitigate expensive invoice issues. If you have concerns about your freight quote vs. your invoice, PartnerShip can help dodge the guessing, help choose the correct services based on your shipping needs, and side-step costly errors.
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How Small Retailers Can Save on Shipping Without Volume Discounts
08/12/2021 — Jen Deming
Small businesses have it tough, and the fact that volume shipping discounts aren’t always an option makes shipping expensive. The good news is that small retailers have options to decrease shipping expenses without having to rely on volume discounts. Check out our helpful video to learn how.
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5 Times The Lowest Freight Quote Won't Work For You
07/08/2021 — Jen DemingIf you're keeping LTL costs low by shopping for great freight rates, you're doing a pretty good job of shipping smarter. But here's a curveball: there's a few specific scenarios where the lowest quote might do more harm than good for your load. Our newest video covers five key instances where you may want to rethink that cheap quote and pay just a bit more for better service.
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5 Painless Ways to Save on Freight
03/12/2021 — Jen Deming
Everybody wants to lower their business operating costs, but nobody wants to spend a lot of time doing it. Decreasing your shipping spend is a good place to start, and there are five painless ways shippers can keep their freight costs low. From auditing your current carriers to tightening up your packaging practices, we break down simple ways to spend less on freight using minimal effort while gaining maximum payoff.
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The Essential Guide to the 2021 FedEx and UPS Rate Increases
12/08/2020 — Leah Palnik
It’s been a wild and unpredictable year, but there’s one thing you can count on as we head into 2021 – the annual FedEx and UPS rate increases. For the fourth year in a row, both carriers announced an average increase of 4.9% for air and ground parcel services. The new rates for UPS will go into effect on December 27, while the new rates for FedEx will go into effect a week later on January 4.
How to budget your parcel costs for 2021
While it may be tempting to budget for a 4.9% increase, you have to dig a little deeper to uncover how much your costs will actually go up in 2021. The actual rate increases vary quite a bit depending on the service you use and your package characteristics.
Both carriers have made the new rates for 2021 available:
You will also need to account for updates to FedEx and UPS surcharges. Common surcharges like Residential Delivery and Address Correction will be more expensive in the new year. But on top of that, FedEx and UPS have both made changes that could cause a package to incur a fee that it wouldn’t have in the past. For example, they both broadened the qualifications for their Additional Handling fee and have updated the list of zip codes for Delivery Area surcharges.
You can view a complete list of the changes that the carriers have each posted:
How to analyze the 2021 FedEx and UPS rate increases
While it’s imperative for you to be aware of the changes coming ahead in the new year, combing through every detail of the new rate charts is challenging and time-consuming. A good place to start is to identify the changes that will have the most significant impact on your budget. First, take a look at your shipments from the last year and identify trends for the services you typically use, your package characteristics, and zip codes. From there you can use the new report from PartnerShip, which highlights the areas with the highest increases and outlines the important changes.
The state of the parcel industry
Aside from the general rate increases, it’s important to understand what’s happening within the parcel industry. Within the past several months, the coronavirus pandemic has brought on a great deal of logistical challenges. Carrier networks have been strained as they struggle to keep up with demand and deal with restrictions. As a result, both FedEx and UPS have instituted peak surcharges.
Most notably, since the beginning of the pandemic FedEx and UPS have been applying peak surcharges to international shipments. Air cargo capacity has been limited which has disrupted the global supply chain and driven costs up.
Additionally, residential deliveries have increased substantially as more people are relying on online shopping. High-volume B2C shippers specifically have been ramping up their business. FedEx and UPS have responded to this increased demand by instituting peak surcharges. Instead of simply applying a surcharge on all residential shipments during the holiday season like they’ve done in the past, UPS and FedEx are applying it to those shippers with a large volume of packages or those who are experiencing a significant increase. That’s good news for many small businesses, but tough on those larger ecommerce retailers.
Even if these peak surcharges don’t apply to your business right now, it doesn’t mean that you’ll forever be immune. There are still a lot of unknowns related to the coronavirus pandemic and how it will continue to impact the supply chain. You will need to stay vigilant and keep up to date on announcements from FedEx and UPS.
What you can do to combat rising shipping costs
With everything the industry is experiencing right now, shippers don’t exactly hold the power. Add the general rate increases on top of that, and you may feel helpless against rising costs. However, there are things you can do to mitigate the damages. Download our guide to the 2021 FedEx and UPS rate increases to help identify the problem areas. Then contact PartnerShip to find out if you qualify for one of our discount shipping programs, and we'll help you ship smarter.
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A Practical Guide to Parcel Shipping Rates
04/23/2020 — Leah Palnik
The ever-rising cost of parcel shipping is a hot topic. FedEx and UPS raise their rates regularly and find clever, new ways to recoup costs. The changes aren’t always clear and can catch shippers by surprise. However, if you have a solid understanding of what determines small package rates and what to look out for, you’ll be in a good position to manage your costs.
How parcel shipping rates are determined
- Weight. No surprise here, but how much your shipment weighs plays a large part in how much it will cost to ship. If you take a look at the service guides for UPS and FedEx, you’ll notice that the heavier the package, the higher the rate.
- Dimensions. You can’t look at just the weight alone. In fact, your package dimensions could cause your shipment to be rated at a higher weight, thanks to what is known as dimensional (DIM) weight pricing. Carriers use this to ensure you’re paying for the space that your shipment takes up in their delivery vehicles. Larger packages take up more room, leaving less space for other deliveries. To avoid this increase in your parcel shipping costs, it’s imperative that you’re efficient with your packaging.
- Service. If you need your shipment to get to its destination sooner rather than later, you’re going to pay for it. Air services that offer delivery overnight or next day will cost you the most. In comparison, if you can plan for some extra time, using a ground service will save you.
- Distance. Your origin and destination ZIP codes play a big part in determining your rate. The farther your shipment needs to travel, the more you’ll pay. This is based on groups of ZIP codes that parcel carriers refer to as zones.
- Fuel. This is a tricky one to put your finger on because both UPS and FedEx will make adjustments on a weekly basis based on information published by the U.S. Energy Information Administration (EIA). The surcharge is a percentage and applies to the base rate, as well as a number of accessorial charges.
- Surcharges. Based on your shipment’s characteristics, you can be hit with additional fees known as accessorials or surcharges. These fees are assessed for things like residential deliveries, additional handling, and oversized dimensions. The best thing you can do is educate yourself on the common fees so you can budget for the unavoidable ones or make some changes to avoid the ones you can.
- Discounts. Not every account is created equal. You may be able to secure discounts directly with your carrier if you have significant volume. For everyone else, you can get discounts by working with a third-party like PartnerShip.
The history of FedEx and UPS rate changes
At the end of every year, FedEx and UPS both announce a general rate increase (GRI). In recent history, it has been an average increase of 4.9%. However, that is only an average – meaning that some rates will actually increase by more or less based on service and package characteristics. Throughout the year, keep track of the type of parcel shipments you process – the services you’re using, the weight and dimensions, and zip codes. That way you’ll be able to focus on determining the rate increases that will affect you the most when the time comes. This information can be overwhelming to go through, so get help where you can. PartnerShip publishes a guide to the rate increases every year that can be a great resource for when you’re planning your budget.
Changes to parcel shipping costs to look out for
It’s hard to predict exactly what changes FedEx and UPS will make to their rates, but it’s important to note that they don’t leave them untouched outside of the GRI. In fact, over the past few years they have been making more changes throughout the year. These changes tend to affect surcharges rather than the base rates. Not only how much they’ll cost you, but also how they’re defined. For instance, FedEx and UPS recently lowered the weight threshold for the Additional Handling fee. That means that more packages will get dinged with that surcharge. Obviously this isn’t a rate increase, but it’s a way that your costs could increase.
FedEx and UPS also make changes based on long-term industry trends, seasonal demand, or unforeseen changes in the market. When their networks are strained the most, FedEx and UPS are bound to react. For example, during past peak holiday seasons when online orders are known to be at an all-time high, UPS instituted a surcharge for residential shipments. And most recently, during the COVID-19 pandemic, FedEx and UPS instituted a temporary surcharge on international shipments due to air cargo capacity being limited.
The bottom line on parcel shipping
Understanding all of the factors that make up your parcel rates is the first step to uncovering opportunities to cut your costs. Along with having that solid foundation of knowledge, keep a good record of your parcel shipments and their details so you can accurately forecast your needs and make adjustments. Lastly, stay on top of the latest updates from FedEx and UPS by reviewing their published changes and signing up for service alerts.
You don’t have to navigate these changes alone. PartnerShip provides resources to help you make sense of parcel shipping rates and can help you cut your costs. Contact us to get started.
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2020 FedEx and UPS Rates Explained
12/10/2019 — Leah Palnik
If you’re planning to budget for your costs to go up 4.9% in the next year, you better think twice. The announced average doesn’t paint a complete picture. The rates for some packages will be increasing less than 4.9%, but that means that the cost to ship other packages is increasing far more. What you’re shipping, where you’re shipping it to, and what service you’re using will ultimately determine how much you should budget for your shipping costs in the new year.Here are the released rates for 2020:
FedEx and UPS surcharges
The rates, however, are only one part of the equation. You also have to take into account the additional fees that UPS and FedEx tack on. It’s more important than ever to be mindful of what could qualify your packages for these surcharges. Not only do the costs increase year over year, but the carriers also make adjustments to how the charges are defined – making it more likely that your packages will be hit with them.
A prime example of this is the change both FedEx and UPS made to their Additional Handling fee for 2020. They’ve lowered the weight threshold to 50 pounds from 70 pounds, which means your costs could go up significantly if you ship packages within that window.Here are all of the announced surcharge changes:
Online shopping has had a profound effect on the parcel industry and the way that FedEx and UPS operate. The carriers are moving more residential deliveries and an increased amount of larger packages, as consumers have become accustomed to being able to order almost anything online and receiving it in 2 days or less.
The changes FedEx and UPS have instituted in recent years and are making in 2020 are a direct response to these industry trends. In the past several years, they’ve broadened the use of dimensional weight pricing, added new peak surcharges, and drastically increased the surcharges for larger packages.
Understanding the 2020 rate increases
We know how daunting it is to analyze the 2020 FedEx and UPS rates, so we’ve done the hard work for you. In our free white paper, we break down the new rate charts and simplify some of the complicated changes. It’s the best way to find out what will cost you the most in the year ahead. Looking for ways to offset the rate increases? We can also help with that. Contact us to find out if you qualify for one of our discount shipping programs.
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Parcel vs Freight: What Works Best for You?
10/22/2019 — Jen Deming
The differences between parcel shipping and less-than-truckload (LTL) freight shipping can be difficult to identify, at least on the surface. If you're not using either service regularly, it can be challenging to know which shipping option you really need. But, there are some definite factors that make a difference to a shipper's experience, like transit times, pricing structure, and security risk. Knowing more about the key differences of parcel vs freight shipping can help determine which makes the most sense for your shipment.
Risk and security
Packaging and handling practices can vary between parcel vs freight shipping, affecting your freight's risk of damage. Typically, parcel shipments are smaller, individually boxed shipments that move separately within the carrier system. Most are under 70 lbs., but they are accepted up to 150 lbs. Freight loads are larger and most often consist of multiple boxes or items collected onto a pallet, or within strapped-together crates, and ship together as a group. Both types of shipments have packaging requirements that include protective material inside the container to help prevent damage. Because freight shipments often use shrink wrap or other binding material to keep boxes together, loss is minimized.
Because of their smaller size, parcel shipments can be easily handled and are generally auto-sorted through the carrier conveyor system. They are then taken to a regional location and transferred through multiple stops and service terminals until final delivery. Because of all the handling, combined with the smaller size of loose parcels, there is an increased risk for lost or misrouted boxes. Freight shipping also includes loading and transfer at multiple stops, but it's less frequent than parcel services. Fewer stops means less loading, but because the pallets may need to be moved with a forklift, there is a risk of damage associated with handling that shippers must keep in mind.
Driver service level
A key point to keep in mind when considering parcel vs freight shipping is the truck driver's level of involvement when it comes to handling the shipment. Parcel shipments moved by common carriers such as FedEx or UPS are loaded, unloaded, and delivered by hand. A shipper is responsible for proper packaging and labeling, and a receiver must check the shipment carton count and for damages. But generally, a driver will take care of handling, including front door pick-up or inside delivery.
Freight shipping is an entirely different story. The driver only moves your freight from pick-up to destination; it is up to the shipper and consignee to have a team ready for the loading and unloading of the freight. This means the driver will not assist. Driver assistance can be requested, but because it is considered a special service, expect to pay extra. Additionally, accessorials such as inside delivery or limited access locations may incur other fees on top of regular shipping charges.
Pricing and cost efficiency
One of the most significant differences in parcel vs freight shipping relates to how pricing is calculated. Freight pricing is determined by several variables, including distance traveled, fuel cost, weight, additional services, and the classification of the shipment. Lane pricing is set by carriers and certain routes across the country can be more competitively priced than others depending on the volume of industry or location type. For example, shipping off-mainland or to a densely congested city's downtown area can be pricey. Depending on your product type, or the density of your shipment, the freight class can either increase or decrease. Lastly, carriers tend to have different levels of liability coverage, depending on freight class, in the event of damage claims on a shipment. Freight class is an extremely important factor for freight shippers as it pertains to cost.
Parcel pricing can also be complicated. The shape, weight, and size of a package all affect the cost, in addition to the type of service requested. Shorter, expedited transit times cost more than standard ground shipping options. Additionally, dimensional (DIM) weight pricing has become popular with common carriers. Dimensional weight bases price on the package volume in relation to its actual weight. The practice was implemented in an effort to minimize awkwardly-sized shipments that waste space in a carrier's truck. It's important to properly calculate your dimensional weight so that you can accurately predict the cost of your shipment.
Knowing the differences of parcel vs freight shipping can help you make the right choice in service and save you in shipping costs. If you're shipping larger, heavier items, or can combine multiple shipments into a single load, using an LTL freight service is right for you. If you're shipping smaller, single boxes and want faster door to door service, parcel shipping is the better option.
Understanding how pricing is calculated for both, and what you can expect your shipment to encounter during transit, will help you ship smarter. If you're still unsure which would make the most sense for your business, call 800-599-2902 or contact us today.
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Machinery Transportation: How to Get the Best Rate
08/08/2019 — Jen DemingMachinery transportation is a tricky endeavor that often presents shippers with a unique set of challenges outside of what is “normal” for a standard freight haul. Because larger, heavy machinery may need specific requirements in order to ensure safe transit, it’s important for shippers to be able to determine the proper equipment for the task. Being able to sort out which equipment type works best for your load can also keep costs where they need to be, so that you’re not overspending on a specialized piece of equipment you don’t really need.
Why trucking equipment matters for your machinery transportation
The variety of heavy hauling equipment used in machinery transportation can vary greatly depending on size, maximum weight capacity, structural components, and materials. Certain types of heavy haul equipment work exclusively with pickup and delivery locations that have docks. Others are built to be flexible in order to fit a variety of different loading and unloading needs for places with limited options like construction sites. It’s important for shippers to keep in mind that the more specialized the piece of equipment, the more time needs to be built into quoting and finding an available truck. It’s also likely that the haul may be more costly. Determining certain factors about the machinery you are planning to ship can help you choose which piece of specialized equipment may make sense the most sense for your load.
Types of equipment to consider for your machinery transportation:
- Best for the budget-minded but flexible: Flatbeds/extendable flatbeds
Flatbeds are some of the most common types of trailers used in truckload shipping and are extremely versatile for a wide variety of haul types, especially for machinery transport. They have a maximum weight limit of 48,000 lbs. Dimensionally, the maximum width and height for legal operation is 8.5 feet. A shipment can be wider, or stacked higher, but over dimensional rules and restrictions will apply.
A major drawback to the standard flatbed is that it is typically raised 60 inches off the ground. This means that either a forklift or a crane will need to be used to load and unload freight. So, if your equipment can be broken down and disassembled for transport, this is your least expensive and most readily-available option.
It’s important to keep in mind that flatbeds are open air trailers. This means your load will be exposed to the elements. Depending on the type of machinery you are moving, tarps and straps may be needed for protection. Most flatbed drivers do have these items available, but it’s critical to note that at the time of your request.
Another type of flatbed option is an extendable deck. This type of equipment is essentially a flatbed trailer that can be expanded to carry longer shipments. The most common size is a 48 foot flatbed that is expandable to 60 feet. If you are shipping a piece of machinery that is extra-long or in multiple pieces, this would be a great option for your load.
- Best for extra tall loads: Step deck
A step deck trailer is very similar to a standard flatbed, but the addition of a tiered upper and lower deck creates two levels in order to accommodate for taller cargo. The shorter upper deck is typically 11 feet in length and can fit 8.5 feet in height. The longer lower deck is 37 feet in length and can accommodate up to 10 feet in height. It’s important to note width requirements are the same as a standard flatbed. If you are shipping a piece of equipment over 9 feet in height, it would make sense to look at a step deck trailer option. These types of trailers often have ramps for unloading, and may be safer for forklift pickup since they are closer to the ground.
- Best for loads that need security and versatility: Conestoga
This trailer option combines the security benefits of a standard three-sided dry van trailer with the versatility of a flatbed trailer’s loading and unloading options. Drivers can side load with cranes or forklifts the same way they would with a flatbed, but don’t need to struggle with tarps and straps for protection from the weather and elements during transit. Another added benefit to the Conestoga retractable tarp system is individual access to any part of a load during transit, making multiple drops easier should your shipment need delivery at multiple locations. These trailers also come in a step deck version which are useful for especially tall pieces of equipment. Conestoga trailers aren’t necessarily a standard part of every fleet, so they can be difficult to find and the price may reflect that depending on spot rate trends.
- Best for extra tall, over dimensional loads: Lowboy/Double drop trailer
As one of the most common trailer types for construction equipment loads, lowboy trailers are especially suited for machinery transport. They can haul from 40,000 to 80,000 lbs. depending on the amount of axles on the trailer. These trailers have a maximum 12 foot freight height and overall load height of 14 feet, making them particularly useful for very large equipment. If the load is over dimensional, it’s important to note that they may require additional permits depending on sizes of the load and state regulations within the transit.
- Best for very large, drive-on equipment: RGN (Removable Gooseneck Trailer)
A removable gooseneck trailer is the most convenient option for machinery transportation, especially for the large pieces of equipment such as cranes, excavators, or other large pieces of construction equipment. The front of the trailer detaches, allowing it to be lowered to ground level to create a ramp. This means loads can be driven onto the trailer, either by operating the machinery itself or via forklifts moving smaller pieces of equipment. Maximum freight weight is 42,000 lbs. but can be up to 80,000 lbs. depending on the number of additional axles. Maximum freight height is 11.6 feet and width is the standard 8.5 feet, but there are “stretch” options too for longer loads. If either the pickup or delivery location need to drive equipment on, this is the option for you. But, because this is the ultimate specialized piece of equipment that offers the greatest flexibility, it’s most likely to be the least cost-effective option.
Machinery transportation can be a complicated process, so it’s very important for shippers to be informed in order to get the best rate. Variables such as height, width, and length of your load all impact what trailer type you need. Available options to the loading and unloading team, such as loading dock height and forklift assistance, all impact whether you need a simple flatbed, or a more sophisticated piece of equipment such as an RGN. If you have a truckload shipment and need assistance to find a reliable carrier with a specialty trailer, contact PartnerShip or get a free quote!
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- Best for the budget-minded but flexible: Flatbeds/extendable flatbeds
Vendor Prepaid versus Inbound Collect Shipping
07/24/2019 — Leah Palnik
One of the simplest and easiest ways to immediately cut your inbound freight costs is to change your shipping terms from "prepaid and add" to "collect." Having your vendor or supplier ship collect on your recommended carrier eliminates any handling charges, thus saving you money.
When you gain more control over your inbound shipping, you can save on small package and freight shipments coming into your business every day. As the buyer and receiver of the goods, you can and should designate the carrier and arrange for shipping charges to be billed directly to you at your discounted rate. This is called routing shipments inbound "collect." Collect is a billing option, in which you are invoiced by the carrier. It does not mean paying the driver at the time of delivery.
In general, there are many benefits to having your inbound shipments routed collect. First, it usually saves a lot of money. But even if you don't have as aggressive freight deals as your vendor, their handling markup could be a lot higher than your freight deal.
Shipping inbound collect also reduces the number of carriers from different suppliers arriving at your receiving dock every day. When you control the routings, you control how many trucks deliver to your door. That also makes it easier to maximize your staff's efforts.
There may be some cases where your supplier's prepaid freight can actually benefit you. First, some suppliers do not add any fees for handling, and freight is just a pass-through. In this instance, you may want to continue having your supplier pay the freight to save some time and money. But if you are trying to consolidate the number of trucks at your dock, and increase the control you have over inbound shipping, it might still be worth routing by your carrier, even if it will cost you more.
Another example of where inbound prepaid may continue to make sense is if your supplier has poor packaging. If you have a supplier that ships a high-value product with suspect packaging, you may want them to prepay and add the freight. Even if they are charging a premium for freight, you do not want to deal with the hassle if that shows up at your door damaged. You will be much better off refusing it and letting your supplier deal with the claims process if there are any damage issues.
Taking control of your inbound shipping may take a little work, but the final payoff is reducing your overall inbound freight spend. If you're ready to take control of your inbound shipping and you're not sure where to start, PartnerShip has the process, tools, and experience to help.
- We can provide a complete, inbound freight analysis to help you determine where you can save additional money on your inbound shipping
- We provide simple inbound supplier/vendor management forms making it easy to choose which vendors you use most frequently
- We create updated routing requests and shipping instructions and then we contact your vendors on your behalf
- We maintain great relationships with the common suppliers in the industry to gain routing compliance
- We can provide inbound shipment visibility reports so you know exactly what was shipped to you and by whom
- We consolidate and audit all of your inbound freight bills so you can enjoy the simplicity of a single invoice
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6 Considerations for Choosing an LTL Freight Carrier
03/13/2019 — Leah Palnik
The 25 largest U.S. less-than-truckload (LTL) carriers collectively brought in $34 billion in revenue in 2017. That is a staggering number and a 7.8% increase over the previous year. When the numbers are in for 2018, don’t be surprised to see another healthy rise. As the largest LTL carriers continue to command more of the overall marketplace, shippers must be resourceful when looking to source LTL freight services so as to not get squeezed on price due to the number of market players. Shippers should take the following six factors into consideration when finding the most efficient LTL freight services.
- Transit Times - How fast do you need to get your shipment to your customer, or to receive your shipment from your vendor? Long-haul carriers tend to have slower transit times in regional lanes, while regional and multi-regional carriers are much faster in these lanes, but may not provide service in longer haul lanes.
- Geographic Coverage - Once you get beyond the top 10 LTL carriers, most of the remaining players provide only regionalized direct pickup and delivery services. Understanding carrier coverage areas helps you optimize which carriers are best suited for the service.
- Service Performance - On time pickup and delivery performance is not always the same. Often this depends on where your business is located relative to the nearest freight terminals. Long-haul carriers traditionally have been known to provide lower delivery reliability, while regional carriers tend to provide reliability in a higher range. Almost all of the LTL carriers will guarantee delivery or provide deliveries that are "faster than standard" for additional fees.
- Liability Coverage - The amount of liability coverage you receive can vary and is set by the carrier. It’s not uncommon to see liability restricted to $0.25 per lb. or less, which means shippers need to be diligent about understanding their options. Especially if the liability coverage doesn’t meet the actual value of the freight.
- Financial Stability - Most of the remaining LTL carriers in the industry are pretty stable from a financial standpoint. However, there are a few carriers that continue to struggle with profitability and debt issues. Anyone who may recall when industry behemoth Consolidated Freightways closed its doors in 2002 will understand the importance of not having your freight in the hands of a financially unstable carrier.
- Pricing Factors - Lastly, and perhaps most importantly for many small business, is price. When working with an LTL freight carrier, there are many factors that will determine your true cost of transportation. These include:
- Discounts, base rates, and net price
Most LTL carriers provide pricing in the form of discounts off of base rates, which will vary by carrier. So, a 68% discount from one carrier might actually be less expensive than a 70% discount from another. The main point to consider when comparing LTL carriers is not what the discount or the base rates are, but rather what is the final net price to you.
- Minimum charge
Generally a flat fee under which the carrier will not discount its price. Some carriers offer big discounts, but set the minimum charge high which may result in less of a discount on smaller weighted shipments than you anticipated.
- Freight classification
There are 18 different freight classes ranging from 50 to 500. These classes are based on the density of your product and will definitely impact your overall price.
- FAK provisions
If negotiated, "freight-all-kinds" provisions may allow you to ship products with different classes under a single class from a pricing standpoint.
How much your shipment weighs will play a significant role in how your rate is calculated. Keep in mind that carriers will use hundredweight pricing, which means that the more your shipment weighs, the less you'll pay per hundred pounds.
- Accessorial fees
Extra services performed by the carrier generally add additional fees to your overall freight bill. The fees that carriers charge for these services can often be radically different so it's important to educate yourself.
- Discounts, base rates, and net price
There are other factors not mentioned above that need to be considered when choosing an LTL freight carrier as well, such as equipment specifications (e.g., liftgate, trailer size, etc.), scheduling flexibility, and tracking capabilities, to name a few. It's easy to see why, what may seem like a simple service of picking up a shipment and delivering it, is often more complex than meets the eye.
Generally speaking, there is almost never just one LTL freight carrier that fits every need you may have. Unless you have spare time on your hands, your best bet is to work with an established freight broker like PartnerShip that can do the heavy lifting for you so that you can stay focused on running your business.
Need some help evaluating your freight shipping? Need help finding the right LTL freight carriers? Let PartnerShip provide you with a free, no-obligation quote to get you started.
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The Best Ways to Become a Shipper of Choice and Why it Matters
02/06/2019 — Leah Palnik
Carriers have more power than ever, which means it’s increasingly important that shippers find ways to make their load more appealing than the next guy’s. Becoming a “shipper of choice” is a great way to get a leg up and ultimately get better access to capacity and reasonable freight rates.
How did we get here? The tight capacity freight market
It's basic economics – the demand for freight services is higher than the current supply of tractor-trailers and drivers. This has been the trend over the past several years, due to a number of factors. For starters, there is a driver shortage. According to ATA’s 2017 Truck Driver Shortage Analysis, the trucking industry was short roughly 36,500 drivers in 2016. The appeal of the open road isn’t what it once was, and not enough qualified drivers are entering the workforce to make up for those who have left or retired.
On top of that, there has been an increase in regulations that have put some constraints on carriers. Hours of services (HOS) rules dictate that truckers can’t drive more than 11 hours a day in a 14 hour period, and thanks to the electronic logging device (ELD) mandate, enforcement of that rule is harder to get around. As a result there are less trucks available to move your freight. Carriers hold the cards and can be picky about the loads they want and what shippers they’ll work with.
What is a shipper of choice?
Becoming a shipper of choice means that your load, your location, and your business practices are in line with what carriers consider desirable. They want to make sure that they’re protecting their bottom line and not losing precious time. This is a status that is achieved by showing carriers respect and committing to a long term strategy that enables best practices.
Why you should care about becoming a shipper of choice
Being a shipper of choice will help you secure a truck at a competitive rate when you need it most. It used to be true that having a large volume of freight is what makes a shipper desirable to carriers. While that often doesn’t hurt, it’s not enough anymore. If you have a great deal of freight but constantly create headaches for your drivers, they will likely turn elsewhere for business or charge you more.
Carriers are becoming savvier when evaluating whether they should work with a shipper or not. Think about how you use apps like Yelp. It’s now incredibly easy to see if a restaurant has bad service or isn’t worth the cost. Truckers have apps like Dock411 that help them easily communicate and access information about load/unload time, parking, security, dock conditions, and more.
How to become a shipper of choice
Reaching shipper of choice status is not something that you can do overnight. You need to commit to making long term changes that are advantageous to both you and your carriers.
Here are a few ways you can achieve this:
- Avoid detention time at all costs.
The last thing you want is to get a reputation for holding up drivers. To them, time is money and it’s important to show that you respect that. HOS rules and the way drivers’ time is strictly tracked through ELDs means that every minute they’re waiting at your dock is taking away from the time they could be earning on the road.
According to a survey conducted by DAT, most carriers consider detention a serious problem and the majority of them rank it in the top five challenges facing their business. Making sure you’re able to load or unload within the 2 hour window is a good way to keep your driver happy and be a shipper of choice.
- Be flexible with pick-ups and deliveries.
When you require a strict appointment time, truckers can’t maximize their time on the road. Also, limiting your hours to weekdays forces drivers to travel during the most heavily trafficked times. By opening up options for your carrier, you increase the chances of your load being covered. And when you make this the rule, rather than the exception, you’re more likely to become a shipper of choice.
In lieu of strict appointments times, you could request pick-up or delivery by a particular day and allow for early arrival. If that doesn’t work for you, you might consider moving from appointment times to a window of time. Being open on off-peak hours and during the weekend also will open up your access to capacity.
- Provide parking options.
Thanks to the HOS rules and ELD mandate, drivers have to be efficient at managing their time. However, as you know, there are a number of factors that can cause them to be tied up including traffic, roadside inspections, and maintenance. If they hit their hours while at your dock, it can be a major risk for them to drive to the next available rest stop.
Allowing drivers to park at your location or having an option nearby can be a major plus. It also shows that you care about the challenges they’re up against. While this may fall more in the “nice to have” category, having parking available could make the difference when carriers evaluate if they want to cover your load over another shipper’s load.
- Make sure your location is safe and easy to access.
One major component that carriers take into account is ease of access. There’s nothing worse than arriving at a location that doesn’t have sufficient space for a truck to maneuver easily or has hazards that make it difficult to navigate.
You might not be able to change where you’re located, but shippers of choice will make it a point to eliminate any potential obstacles they can. It’s also important that you provide clear signage that can help direct the driver appropriately when he/she arrives.
- Treat your drivers the way you would want to be treated.
Truck drivers don’t have an easy job, and they spend a tiring amount of time on the road. If you deny them basic amenities like access to a bathroom and a place to stretch their legs while they wait, that is not something they’re likely to forget.
Showing respect and being kind goes a long way. Greet your drivers and provide an area where they can relax and refresh while being loaded or unloaded. Some shippers are even providing full lounges designed to make drivers as comfortable as possible, with wifi, refreshments, and showers. You can’t be a shipper of choice if you aren’t willing to show a little bit of empathy for your drivers.
Now that you know what it means to be a shipper of choice, why it matters, and how you can achieve it, the next step is create a plan. Carrier relationships are incredibly important in today’s freight market, and when you make them a priority, you’ll benefit your business in the long run.
PartnerShip maintains strong alliances with the best carriers in the industry. Our shipping experts can help you find ways to become a shipper of choice, gain access to capacity, and save on your freight rates. Contact us today to find out how you can ship smarter.
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- Avoid detention time at all costs.
The Impact of Natural Disasters on Freight Shipping
10/15/2018 — PartnerShip
Our economy relies on the reliable transportation of goods and materials to link suppliers with manufacturers, manufacturers with retailers, and retailers with consumers. When natural disasters happen, they can negatively impact your carriers, your lanes, your supply chain, and your cost of moving freight.
The natural disasters that have the most profound impact on the movement of freight are floods, hurricanes, blizzards, earthquakes, and ice storms. Each of these natural calamities produces dangerous road conditions that make driving hazardous, and in extreme cases, can wash away roads or make them completely impassable.
Here are 6 ways that natural disasters can impact your freight shipping operations.
Rates. Obviously, your freight shipping rates will increase in a natural catastrophe. If roads become impassable, alternate routes will need to be taken, increasing fuel consumption and lengthening driver on-duty time, both of which are costs that will be passed along to you. Your freight rates will also increase due to tighter capacity with demand outstripping equipment or carriers refusing to travel to areas with impending, or predicted, severe weather. If you do find a driver and / or equipment willing to take the risk, you will pay for it.
Capacity. After a natural disaster, there is substantial competition for limited transportation resources and equipment. This limited capacity will naturally push costs up, but even if you can afford it, the capacity might be impossible to find.
Transit time. If your regular Atlanta to New Jersey lane is two days, it may stretch to three, four, five or more if a hurricane is bearing down on the east coast. The driver may need to wait it out inland until roads are passable, until the warehouse or factory is open again for business, or may just be caught in traffic. This will increase your transit time.
Fuel. Diesel prices always rise in the wake of a natural disaster, especially hurricanes, because refineries are frequently located near where hurricanes make landfall. This can close a refinery or damage it, making fuel more expensive. In 2017, Hurricane Harvey shut down about 17% of US oil refining capacity in Corpus Christi, Port Arthur, Lake Charles and Houston, TX. The disruption to oil refining drives up fuel prices and the fuel surcharges carriers charge you for every load.
Refused loads. Many times carriers will refuse to pick up or deliver freight in the event of a natural disaster. If your carriers refuse your loads, your supply chain will suffer. Your plants can go idle, waiting for materials or components; your customers’ plants can go idle, waiting for you; retailers can run out of inventory; all of which result in opportunity and revenue lost.
Inbound delays. Your flight from Dallas to Los Angeles will be delayed if the inbound flight from Chicago is late due to weather. Inbound freight can be impacted in the same way. Even though your area might not be facing weather issues or a natural catastrophe, if your inbound freight is delayed due to facility shutdowns or power outages caused by severe weather, you will be affected.
Here are some suggestions to deal with the effects of natural disasters on your shipping:
Working with a freight broker can help you mitigate the service interruptions, capacity issues and increased costs associated with natural disasters and severe weather. Contact PartnerShip at 800-599-2902 or request a quote to see how we can help you ship smarter so you can stay competitive.
- Two tactics to manage unexpected increases in your freight rates are 1), accrue for contingencies in your annual freight budget and 2), shop around. Working with a broker that has access to thousands of carriers can help you move a load when your regular carriers cannot.
- To alleviate difficulties due to a lack of capacity, think through different transportation options before disaster strikes, such as lining up backup carriers for different regions of the country or shipping lanes, and working with your existing carriers to map out alternate routes.
- Build slack into your supply chain. Just-in-time inventory control is easier when you manage the assets moving your freight but is much more difficult to control when you are relying on carriers which can be delayed to natural disasters.
- Leverage your freight spend. Giving more freight to fewer carriers can help you negotiate lower fuel surcharges.
- Plan your transportation to optimize transportation modes. For example, it might be less expensive to ship your freight as multiple LTL loads rather than full truckload. Or moving everything in one truck might be the better alternative.
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How to Reduce Shipping Costs: Are You Sabotaging Your Freight Spend?
09/27/2018 — Jen Deming
Shipping expenses are one of the top expenditures for most businesses, which comes as no surprise because it can be extremely challenging to determine how to reduce shipping costs. So far in 2018, US companies spent 6.2% more than they did year-over-year, totaling a record $1.49 trillion in shipping- related expenses. Many common shipping practices sabotage a business's ability to get ahead by protecting their bottom line. What are some important mistakes to avoid when figuring out how to reduce your shipping costs?
It's not always what's inside that counts.
Proper packaging is critical in helping to reduce shipping costs. We are all familiar with the risk of damages - used boxes that have holes or older labels still attached are asking for trouble. Make sure you are using the correct type of packaging materials for the product that you are moving. If you have more than a few boxes, it's a good idea to palletize all of them together, and wrap with shrink wrap. Freight shipments are loaded and unloaded at several terminal stations in route, and palletizing can keep them from being separated or lost along the way. It's also critical to use the right size packaging to help shippers reduce shipping costs. Make sure you are packaging your product with enough space inside to include proper cushioning, but not so much as to allow room for shifting or that make it difficult to handle - a carrier will charge for that too.
You are clueless about your customer's location.
Are you aware whether your receiver has a dock? How about a forklift? Are you delivering to a school, church, or another hard-to-reach area or location that risks being designated as "limited access" by the carrier? Will a 53' dry van be able to maneuver around that location? In addition to that, are hours of operation restricted for pick-ups or delivery? Every one of these variables can make a delivery potentially more difficult and more damaging to your bottom line due to costly accessorial charges. Keep in mind, the more difficult it is to get the delivery completed, the more you need to be prepared for additional fees. Planning ahead and knowing exactly what your carrier will charge for any additional services will help keep your shipping costs where they need to be.
Assuming that delivery estimate is a guarantee.
Shippers have to keep in mind that the estimated delivery day is just that - an estimate. Just as with your everyday postal service provider, business days are those included in a work week - weekends and holidays are not included. A more reliable measure to figure out shipment delivery is to take a look at transit times. When scheduling with a carrier, be sure to ask for this rather than relying on the estimated delivery date. That way, you know if your 5 day freight transit picks up on Monday, and an unexpected storm kicks up along the way, a 1 day transit delay actually results in a Monday delivery. Keep things safe by factoring in a couple extra buffer days when communicating to your customer. If you are truly in a crunch, shop the different expedited service options among different carriers, but be aware anything last minute will cost you, especially as weather worsens as we head into winter and the holiday crunch. Avoiding last minute rush shipments is always the quickest way to reduce shipping costs.
It's about 500lbs...ish?
The old adage, "measure twice, cut once" isn't just a cute lesson in being diligent - it's a very important rule for shippers to live by. Guessing just doesn't work in an industry where being a few pounds or inches off can potentially double your freight bill. Carriers check weight and dimensions once, twice, and once more just for fun with calibrated scales every time your pallet is picked up by a forklift at a terminal. If the weight of your shipment doesn't add up to what's on the BOL, you can pretty much rest assured you will be billed for the difference. If you've already quoted your customer and billed them on shipping you estimated based on inaccurate measurements, you're playing a risky game. Be sure your warehouse scale is calibrated and reset often. If you don't have a large enough commercial scale at your place of business, measure each component of your load (including pallets) and add them up. Be as thorough and as accurate as possible to avoid any surprises.
Handing the reins to your vendor.
You may love your vendors, but lots of businesses take for granted the cost- cutting potential that's available by managing their own shipping. If you are able to do so, it pays to take a look at what carrier and service your vendor is using to deliver your freight and take control of your inbound options. Some carriers have more competitive lanes in certain regions, while others may offer additional options and less expensive fees for extra services your business may require. If you are responsible for your inbound freight costs, it's worth it to put in the time to measure which carrier and service really work best for you. The additional responsibility doesn't have to be a headache, either. By working with a quality 3PL, you can make sure you are using the correct carrier, correct service level, at the most competitive price. It's a surefire way to be sure you are reducing your shipping costs where you need to.
Figuring out how to reduce shipping costs starts with some simple best practices. Double checking your specs, being knowledgeable about your transit and locations, and researching carrier options help keep you prepared and proactive about avoiding higher freight costs. When you are stuck or simply need some experts on your side, PartnerShip can help make sure you are setting yourself up for success. To speak with a specialist to learn more about where you can cut your shipping costs, call 800-599-2902 or email sales@PartnerShip.com.
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FedEx and UPS Peak Season Surcharges: The Important Differences
08/09/2018 — Leah Palnik
FedEx recently announced that for the second year in a row, it won’t be applying a peak season surcharge on residential shipments. This is good news for retailers who expect a significant amount of e-commerce orders over the 2018 holiday season.
UPS, however, will be instituting a surcharge on residential ground shipments from November 18 through December 1 and then again from December 16 through December 22. UPS will be charging $0.28 per package for most residential shipments using ground services. For UPS air services the fees are as high as $0.99 per package.
UPS delivered around 700 million packages during the 2017 holiday season – a huge jump compared to the rest of the year. Ordering online has become so commonplace and easy for shoppers, and the carriers are feeling the effects. The increase in volume over the holidays drove UPS to introduce this new peak surcharge for the first time last year.
Typically UPS and FedEx have comparable rates and surcharges and will mimic each other’s changes, so this is a notable distinction between the two small package giants.
FedEx is sending a clear message to shippers. “FedEx delivers possibilities every day for millions of small- and medium-sized businesses,” said Raj Subramaniam, executive vice president and chief marketing and communications officer at FedEx Corp. “We are demonstrating our support for these loyal customers during this critical timeframe by not adding additional residential peak surcharges, except for situations where the shipments are oversized, unauthorized or necessitate additional handling.”
It’s important to note that both carriers are implementing charges on larger packages. With the rise of e-commerce, people are ordering items online that they would’ve exclusively purchased in-store in the past – including televisions and appliances. FedEx and UPS have made several adjustments to account for these trends, including a pushback on larger packages. Heavy and bulky packages don’t move through their automated systems and require more attention. FedEx and UPS are putting a price tag on that loss in efficiency and shippers need to stay aware.
FedEx will apply peak surcharges for larger packages from November 19 through December 24:
- $3.20 per package for shipments that necessitate additional handling
- $27.50 per package for shipments that qualify as oversize
- $150.00 per package for shipments that qualify as unauthorized
UPS will apply peak surcharges for larger packages from November 18 through December 22:
- $3.15 per package for shipments that necessitate additional handling
- $26.20 per package for shipments that qualify as large
- $165.00 per package for shipments that qualify as over maximum limits
If you’re not careful, the surcharges can add up fast. These peak surcharges are in addition to the already existing surcharges that apply to larger packages, and any others that may apply including delivery area and residential surcharges.
Retailers should take note of these peak season changes to ensure a profitable 2018 holiday season. If you see a significant amount of online orders over the holidays and ship with UPS, you’ll be paying an extra $0.28 per package, which will eat into your bottom line.
To prepare, take a look at what you shipped last year around the holidays and determine a forecast for this season. From there you’ll be able to see how much more you can expect to spend during the designated peak season. You may find that switching from UPS to FedEx for the busiest time of the year will provide you with a decent cost savings. Depending on the billable weight of your shipment and the destination, the base rate could be lower with FedEx – compounding the savings during peak season. It’s worth evaluating the options, when the holiday season can make or break your year.
There are many factors to consider when deciding how to ship your small package shipments. You need an expert on your side. ParterShip manages shipping programs for over 140 associations, providing exclusive discounts on small package shipments to their members. To find out if you qualify or to learn how you can ship smarter, contact us today.
FedEx and UPS rates will be going up after the holiday season! Make sure you know what to expect so you can mitigate the impact to your bottom line. Our free white paper breaks down where you'll find the highest increases and explain some of the complicated changes you need to be aware of.
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It All Adds Up: The Operational Costs of Moving Freight
06/22/2018 — PartnerShip
Moving freight is getting more difficult, and therefore, more expensive. If you’ve ever had “sticker shock” from a freight quote, you’re not alone. There are a lot of cost factors that go into the price you pay to move freight, so we want to explain them so you can be an informed shipper and ship smarter.
Every LTL or truckload freight shipment has fixed and variable costs that are calculated into the rate you pay to ship your freight. Let’s start by looking at the fixed costs.
- Truck Payment. Owned or leased, drivers and operators have the expense of their equipment (trucks and trailers) to consider when quoting your freight. New trucks can be leased for $1,600 to $2,500 per month and used trucks can be leased for $800 -- $1,600 per month; a new truck can be purchased for $2,250 a month (purchase price of $125,000 with 5-year financing). On average, truck payments are 16% of the cost of moving freight.
- Insurance. The FMCSA requires individual owner-operators to carry a minimum of $750,000 to $5 million in liability coverage. On average, liability and damage insurance can cost between $6,000 – $8,000 per year, with newly-granted authorities typically paying between $10,000 and $16,000 their first year. Truck insurance accounts for 5% of the cost of freight shipping.
- Driver Salary. This is the largest operating cost of moving freight. Commercial truck driver salaries are based on the distance driven, and although drivers spend a lot of time in traffic, at the dock being loaded or unloaded, etc., their operating costs are only derived from miles traveled. With an average salary of $78,200, driver pay and benefits accounts for 43% of operational costs.
- Office and Overhead. This fixed cost includes a building lease or mortgage, and includes electric, phones, internet, computers, and office support. These costs can vary widely.
- Permits and Licenses. Permits and license plate costs account for $2,300 annually, or 1% of operational costs.
There are also many miscellaneous items that can factor into overall freight costs:
- Fuel. The second largest operating cost of moving freight is diesel fuel. A commercial truck can easily consume 20,000 gallons ($64,000) of diesel fuel per year, accounting for 21% of operational costs.
- Tires. Retreaded truck tires are less expensive than new tires and cost on average $250. Annual tire expense accounts for $3,600, which is roughly 2% of operational costs.
- Maintenance and Repairs. Trucks need constant maintenance and do occasionally break down. Issues with air lines and hoses, alternators, wiring, and brakes are all common in commercial trucks, and can cost $17,500 annually or 10% of operational costs.
- Meals. The truck isn’t the only part of LTL and truckload freight shipping that needs fuel! 10 meals a week at $12 each equals a meals expense of $6,500 a year.
- Tolls. With nearly 5,000 miles of toll roads in the US, chances are good that your freight will be traversing at least one of them, and this will be factored in your cost. For example, a load moving from Chicago to Baltimore will encounter toll roads in Illinois, Indiana, Ohio, and Pennsylvania, costing $225.75. Sometimes a carrier can avoid toll roads, but this will frequently increase the number of miles driven, which also increases your cost. On average, tolls add $2,500 a year, 2% of the total cost of freight shipping.
- Coffee. Did you know that truck stops sell more coffee than convenience stores? The average commercial truck driver spends more than $600 a year on coffee. Its effect on cost is negligible but we thought it was interesting!
- Profit. Remember, freight carriers are in business to make a profit. Owners, operators and drivers are funding their kids’ education or dance lessons, paying their mortgages, and buying food and necessities, so please don’t expect them to move your freight for free.
The bottom line is that a lot of factors go into the cost you pay for LTL or truckload freight shipping. The costs listed here are conservative and are probably on the low end, so your costs may be higher.
- Electronic Logging Devices (ELD), which have decreased driver productivity approximately 15%. When drivers spend less time driving, transit times increase and drivers move fewer loads, which pushes costs up.
- Telematics services, such as vehicle and trailer GPS tracking.
- Driver turnover; not just the cost of recruiting and training, but also the opportunity cost of empty trucks not hauling freight because they have no drivers.
- Finding loads to move can take up a sizable chunk of every day. Every hour spent not driving loaded miles is an hour a driver isn’t making money.
The struggle is real: moving freight is getting more difficult and more expensive. By shedding light on the costs that go into each and every LTL or truckload freight move, we hope that you’re better informed so you don’t experience “sticker shock” next time you get a freight quote. If you find yourself battling rising freight costs and need some help, contact the freight shipping experts at PartnerShip. We have significant experience in both the LTL and full truckload markets and can help you ship smarter so you can stay competitive.
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Factors Contributing to the 2018 LTL Rate Increases
06/19/2018 — Leah Palnik
LTL freight rate increases are unavoidable. And in this current tight capacity market, it’s no surprise that many carriers have taken their general rate increases (GRIs) earlier than in previous years. Just like in the truckload market, costs are been driven up by the ELD mandate, the driver shortage, and hours of service (HOS) rules. Coupled with the strong U.S. economy, freight demand is surging and straining the market.
Along with the tight capacity market, trends towards shorter supply chains and smaller, lighter loads have led to more demand for LTL services. The rise of ecommerce has played a large role in the increased demand. Products that consumers never would have dreamed of ordering online years ago, like furniture, have now become commonplace for ecommerce. However, these types of shipments are less desirable for carriers. With more deliveries being made to more remote areas without backhaul opportunities, the costs are significantly higher for them.
With the driver shortage, it is easier for carriers to find and recruit LTL drivers, compared to truckload. They are more appealing jobs, with shorter lengths of hauls and less time away from home and families. However, there are fewer LTL carriers entering the market when compared to truckload. The complex networks of terminals that LTL carriers rely on are much more difficult to establish, making it a significant barrier to entry.
With all of those factors to contend with, LTL carriers have been announcing their GRIs throughout the first half of 2018.
- FedEx Freight: 4.9% effective January 1
- YRC Freight: 5.9% effective February 19
- XPO: 5.9% effective March 5
- UPS Freight: 5.9% effective March 26
- ABF: 5.9% effective April 16
- Estes: 5.9% effective May 7
- Old Dominion: 4.9% effective June 4
Rates aren’t the only thing on the rise. Many carriers are charging more for accessorials like inside delivery or Saturday delivery. Carriers are also implementing tools and technology that help them determine what types of freight are profitable and which ones aren’t – and charging accordingly. Dimensional pricing is one example of this. Many carriers have invested in dimensioning machines, which calculate the amount of space a shipment will need in the truck, leading to less dependency on the National Motor Freight Classification (NMFC) system.
As with any announced rate increases, the important thing to remember is that the averages may not reflect the actual increases you’ll see in your freight bills. Depending on the lane and shipment characteristics like weight or class, the increase could be significantly more.
To determine what you can expect and what you can do to offset the rising costs, start by taking a look at the increases for your typical lanes. That will give you a better idea of what cost increases you can budget for, rather than relying solely on the reported averages. Then determine ways to reduce those costs. Consider working with a freight broker, to benefit from their industry expertise. A quality broker will have the knowledge to help you navigate the market and will be able to find solutions that can help to reduce your costs.
PartnerShip can help you ship smarter. For a competitive rate on your next LTL shipment, get a free quote!
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High Freight Rates and Tight Capacity: What You Can Expect
01/22/2018 — Leah Palnik
If you’ve been experiencing sticker shock from unpredictable freight rates lately, you’re not alone. Shippers are seeing a lot of volatility in the truckload and LTL market, with no end in sight.
2017 ended with tightened capacity and record rates. By December, the average van rate was $2.11 per mile (DAT) – an all time high. The load-to-truck ratio was also breaking records at the end of the year, with 9 load postings for every truck posting in December.
Coming off of a record high December, capacity continues to be tight in January – particularly with reefers since they’re needed to keep freight from freezing in the coldest parts of the country. DAT reported that the national load-to-truck ratio at the beginning of the year was the highest ever recorded at 25.2 reefer loads per truck. During which, the reefer rate was at a high $2.71/mile. Van rates have also been breaking records. According to DAT, they were at $2.30/mile on January 6.
So what can shippers expect going forward? Let’s look at the trends. We saw a bit of a recession in 2015 and 2016 with rates and load-to-truck ratios declining, but that appears to be over. Rates climbed throughout 2017 and we can continue to expect increases in 2018.
Overall, the U.S. economy is healthy right now and is growing, increasing freight demand. In contrast, the trucking industry is dealing with the aftermath of the ELD (electronic logging devices) mandate. Not only do they need more drivers and more equipment on the road to handle the same amount of freight, but they are also contending with a long running driver shortage. All of this equals tightened capacity, which is becoming the new normal in the industry.
Recent weather events have been driving up rates as well. Areas of the U.S. that don’t typically experience extreme cold or snow have been hit by treacherous weather that has led to dangerous conditions including low visibility and icy roads. In a tight capacity market, these conditions drive up rates even more.
In February we can expect to see capacity loosen some (barring any winter storms or other troublesome events), as this is typically the slowest time of year for freight. However, you’re likely to see higher rates than you have in years past, because of the long-term trends.
In April, drivers not complying with the ELD mandate will be put out of service. Up until then, inspectors and roadside enforcement personnel are simply documenting and issuing citations if a truck isn’t equipped with the required device. As a result, we may see some ripple effects. There could be fleets that have held out or hoped to fly under the radar until April. There could also be another wave of trucking companies exiting the market, which will leave a void in the already tight market.
Now it’s more important than ever to find ways to mitigate the impact of this tightened capacity. Plan ahead so you can be flexible. Providing more lead time and giving your carrier a longer pickup window rather than a specific time can lessen the strain on its network. Planning ahead can also help you shift to more committed freight and away from the spot market. The spot market is more sensitive to disruptions and subject to reactionary pricing spikes.
Luckily you don’t have to navigate the freight market alone. When you work with PartnerShip, you benefit from our large network of carrier partners and our shipping expertise. We help you ship smarter with competitive rates and reliable service. Get a quote today!
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The 2018 FedEx and UPS Rate Increases: A Closer Look
11/20/2017 — Leah Palnik
With the New Year approaching, it’s time to look at the UPS and FedEx rate increases for 2018 and how they will affect your costs. In September, FedEx announced an average increase of 4.9% on Express and Ground services. UPS joined the party in October, announcing that they will also be increasing their rates by an average of 4.9%. The new 2018 UPS rates will take effect on December 24, 2017, while FedEx will be instating them a week later on January 1, 2018.
The averages might be the same, but the rates vary. With higher increases for some services and lower increases for others, you can’t budget based on your costs increasing 4.9%. It’s important to look at what services you use, your package characteristics, and the locations you’re shipping to, and then evaluate the new rate charts to find your biggest cost offenders from the 2018 FedEx and UPS rate increases.
On top of the FedEx and UPS rate increases for 2018, there are additional updates that are likely to affect your shipping costs. First, UPS is lowering its dimensional (DIM) weight divisor from 166 to 139 for domestic packages less than or equal to one cubic foot (1,728 inches) in size. With this change, UPS and FedEx are back in line with each other on how they calculate dimensional weight. Both carriers will now use 139 for all domestic and international packages.
It’s been a wild ride the past few years with multiple changes to which packages DIM weight pricing applies to and how it’s calculated, so this is a welcome stabilization. However, a lower divisor means a higher chance that your package will get billed at your DIM weight, rather than your actual weight. If you ship packages one cubic foot or under with UPS, it’s important to take note and make changes to eliminate any unused space in your packaging or consolidate orders when possible.
Surcharges are also increasing, with some at alarming rates. Most notably, in 2018 FedEx and UPS are coming after larger, oversized packages. Not only are they increasing at a higher rate than most surcharges, they are by far the most costly. For example, the FedEx Unauthorized Packages fee is increasing from $115 to $300 and the UPS Over Maximum Limits charge is increasing from $150 to $500. The shipping trends that have resulted from the rise of e-commerce has taken its toll on the carriers and they’re having to move more and more oversized packages that can’t go through their automated systems. Time is money, so they’re tacking on hefty fees to make up for it.
Ahead of the new FedEx and UPS rate increases for 2018, new holiday peak season charges will also apply. UPS is adding peak surcharges on domestic residential packages during the busiest shipping days of the year – from November 19 to December 2 and from December 17 to December 23. These fees will add up quick when you have an increased amount of orders over the holidays.
In a notable departure from UPS, FedEx decided not to add a peak season surcharge this season. Instead they opted to increase surcharges for packages that are big or bulky enough to require special handling. UPS is also increasing the cost of larger packages by adding additional peak season surcharges on top of the already existing surcharges. The 2018 UPS rate announcement included increases for these surcharges for the next holiday season, so you can expect this trend to continue.
The 2018 FedEx and UPS rate increases are proof that the carriers are getting smarter, hitting shippers where it hurts most. Luckily, you don’t have to navigate the changes alone. The shipping experts at PartnerShip have evaluated the new rate charts and we have completed a detailed analysis, so it’s easier for you to assess the impact on your shipping costs. Download our free white paper today!
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Truckload Rates Are Going Way Up. Are You Ready?
10/31/2017 — PartnerShip
Truckload shipping costs have been steadily climbing and are poised to go even higher because a perfect storm of events is pushing truckload rates to record highs: the looming Electronic Logging Device (ELD) mandate; the cleanup and aftermath of Hurricanes Harvey, Irma and Maria; and an already significant driver shortage that has stressed truckload capacity.