Ask AFS: How Can I Tell If My Company Is Really Getting The Best LTL Rates?

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There’s been a lot of talk recently about how it’s becoming a more shipper-friendly LTL market again. In light of this, how can I ensure that my company is really getting the best LTL rates?

Let’s start with the obvious: If you’re not seeing at least some decrease in your LTL shipping spend, you probably aren’t, because many carriers that didn’t want or need your business over the past few years (and who could price opportunistically) are more likely to welcome it now – and to price their services accordingly.

In fact, if you’re not seeing reductions of anywhere from 5 – 12%, that’s probably a red flag.

So if our LTL rates are going down, we’re probably good, right?

Not necessarily. Just because an LTL carrier is offering you lower rates, that doesn’t automatically mean that it’s offering your company the best possible rates.

This is especially true if the carrier thinks of your company as a captured account – or if it knows that you don’t have a lot of LTL pricing data (besides your company’s own) to benchmark against. And it’s doubly true if your company hasn’t been particularly successful at negotiating superior rates in the past. After all, even if you’re paying lower rates than you were before, those rates could still be considerably more than what others are paying.

Your best bet is to do some comparison shopping. Instead of shipping via the handful of carriers that you’ve always worked with, reach out to some others to see what rates they’re willing to offer you. You might be surprised by how much lower they are. (Or, if your carriers are doing right by you, you might be pleasantly surprised to discover the rates are not all that different.)

Another idea is to use the services of a consultant or 3PL that works with a lot of other LTL shippers. Their experience at the center of numerous companies’ freight negotiations gives them a much more informed view of what LTL market rates really are – and the ability to help you do a better job of differentiating between prices that look terrific and prices that actually are.

Want to know more? Check out AFS’s latest freight index , which includes the latest information about LTL market rates. Or drop our LTL experts a line.

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