According to various sources, Less-Than-Truckload (LTL) freight volumes have started to decline. Would we be correct in assuming this is a good thing for shippers?
It’s a nice change after years of it basically being a carriers’ market, because for the first time in a long while, many LTLs have less (rather than more) business than they can handle.
That could definitely open the door to better rates or improved service options for shippers.
So, is it time to ask our carriers for a price break?
You’re always welcome to ask. Just don’t be surprised if they politely say no. After all, you did agree to pay those rates when you signed your agreements with them.
If you really want to reduce your LTL spend, think about testing the market with different LTL carriers instead. In order to win your business, most should be willing to offer you the latest market rates, which may be considerably less than what you’re spending now.
Would a 3PL have better luck negotiating LTL rates for our company than we would?
Most likely – but not for the reason you probably think.
While many people assume that a large 3PL gets better rates because of its high-volume buying power, the real advantage we offer is that we’re at the center of hundreds of different companies’ freight negotiations. As a result, we have a much clearer view of what market rates really are at any given time – and the ability to help you differentiate between an LTL pricing contract that appears to be a really good deal and one that actually is. (P.S. If you want to take advantage of our company’s knack for this, drop us a line.)
Any other advice?
Although all signs point to early 2023 being a friendlier shippers’ market, don’t confuse having more leverage with having carte blanche to treat your valued carriers poorly. Just like you probably feel more loyal to the LTLs who didn’t engage in opportunistic pricing in recent years, they’ll appreciate and remember the shippers who still treated them with respect and professionalism during the negotiating process. Always remember that what goes around, comes around.