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Topics Understanding Freight Class Calculating Freight Density How to get the best rates Sending out your shipment Forms List of Freight Carriers
When OBI started shipping orders in 2004 we had no idea how to start shipping or where to get information. Today OBI is shipping out many pallets per day and we know exactly what to do and how to get the best rates. This guide is not company specific, we use 5 different freight carries at any given time. We have found that in the long run is it better to work directly with carriers then with freight brokers, we will get into that later. LTL stands for Less-Than-Truckload. Usually the freight is shipped on pallets. The rate you get is determined by the freight class, the destination and the weight you are shipping.
The first problem you are going to run into is: What is freight class? Freight class is standardized classification system to determine how much your freight should cost to ship based on a number of factors. It is like a weighted system to compare apples and bricks. The freight class of an item is determined by many factors such as: Type of Product, Value of Product, Ease of Handling and Liability. The freight classes go from 50 to 500, 50 is cheapest, 500 is most expensive. The NMFC (National Motor Freight Classification) system is what is used to determine your items class. The best way to determine your freight class is to call an LTL carrier. They are more than happy to help and they don't charge you for the information. Once you describe your item they will look it up and give you the NMFC number(s) and freight class. Ask them to fax or email you the details for the NMFC number(s) they told you. These may come in handy later on for your reference. Sometimes a given type of freight can be classified into a general category like "Novelty Merchandise" or a very specific category like "Framed Art." A shipment we send out may be "Framed Art," but it has a high density so it may be cheaper to ship it as "Novelty Merchandise." Here are the NMFC details for Novelty Merchandise - 056290. This is the number we ship most of our goods under. It is based on density (pounds per cubic foot). NMFC based on Shipment Density You may be wondering: Why does the density matter? The answer is: The higher the density, the less space the
shipment takes up.
You can see both shipments weigh the same but the first shipment is going to take up over twice the space as the second shipment. The freight class gives the carrier this information so they can give you a correct quote on the shipment. Some NMFC numbers rely on value of the item or are very straightforward so you don't need to do anymore work to determine to get a shipping quote from a company. Calculating
Freight Density
If you call a freight company for a quote have the following information ready: Number of Pallets, Destination Zip Code, Weight, Freight Class and any shipment details such as Commercial or Residential, or if a lift gate is needed. If it is your first time calling they will act very generous and say "Today I will give you a 40% discount." In truth this is standard practice and they always give discounts. Generally good discounts are 60%-70% or more. This usually requires an account with the company and speaking with the local sales rep. Be careful when getting shipments sent to you freight collect. If you have an account with that carrier, your account will be used to calculate the shipping. Even though your supplier may give you a quote it could be made invalid by your account with the freight carrier. There are several points to discuss with the rep to get you a better rate. - Discount - The percentage off of their "standard" rate. Usually 60%-70% is good depending on the carrier although sometimes they are as high as 80% - Residential Charges - Some carriers are very fair and others will kill you with this charge, you can negotiate with the rep to get it into the $20 to $45 range pretty easily. This includes an appointment and usually delays delivery by 1 day. If the recipient is in a hurry have them call the local terminal to initiate an appointment and you can save the extra day. - Lift gate - This one is harder because some carriers
don't have lift gates on many of their trucks. R+L carriers has a lift gate on
all their trucks so for any shipment that requires a lift gate we usually use
them because a lift gate charge alone can be $35 to $95. - Appointment - This is less commonly free, but you can get it down to $10 to $20. This is calling and setting up a delivery appointment with the recipient. An appointment is always included in a residential charge, so don't let them charge you for both. This can delay delivery for a day. - Inside Delivery - This is the worst charge and usually the most expensive $35 to $85. If your recipient is in a mall and they tell the driver has to use a pallet jack to take it to their shop then you just paid an Inside Delivery charge. Sometimes on a residential charge the recipient will sit there while the driver put the freight in their garage. And again you paid and Inside Delivery charge. - FAK - This mean Frieght of All Kinds and it can be
very important. This is much harder to get unless you ship with a carrier
quite often. The BOL or Bill of Lading is the document you use to send
your shipment. Below is a sample Bill Of Lading you can use if you like. Hand
written BOLs get charged incorrectly much more often than typed BOLs. After your BOL is filled out and your pallets are wrapped and tagged, the last step is to call the carrier for a pickup. Usually 4 hours is big enough window to get your shipment out unless you live in a rural area or hard to get to area. This a list of freight carriers we commonly use. Theses are good, legitimate carriers that we have worked with for years. There is no particular order to this list.
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