The Freight Doctor

One good question I like to give people to ask about with whom they should choose as a their freightbroker or 3pl company is, “Do you use major freight carriers?” If the company you are working with uses major trucking lines, such as Yellow, Saia, Con-Way, Estes, ABF to name but a few, then you should be comfortable working with the freight broker or 3pl. This is because these trucking companies are huge operations with great tracking systems of your freight when in transit and chances are, even in this down economy, they’re not going anywhere anytime soon. Also, if the logistics company has accounts with these trucking companies or similar sized trucking outfits, they probably move a lot of freight with them. How does this help you? Well, if they move a lot of freight, then they’ve probably been able to negotiate and justify to these large trucking companies for amazingly cheap shipping rates. They’ve probably also negotiated having an FAK which means better rates for you. You, as Joe Customer, will not be able to come in off the street and demand the best rates with little to no volume and no track record. If the freight broker or 3pl has been around for awhile they’ve done all the hard work in getting freight rates down so all you have to do is swoop in and take advantage of their great rates. It’s just up to you to shop around and find the best freight quote!

When you’re in the process of obtaining freight quotes from freight brokers and 3PLs one thing to ask for is the
FAK of your commodity. It’s important to find out for two reasons:

The first reason is so for your own information should you ship the same or similar item out in the future.

The second and more important reason is to find out who is willing to give you this information. Any freight broker who is hesitant to give you the FAK is someone trying to hide information from you. The FAK is not priviledged information and you have the right to know what FAK your load is being classified at. This way, if you get multiple freight quotes, you can correct any company that is rating you at a higher FAK so you can bring your freight rate down to an accurate level and save yourself from being over charged.

So to sum up, ask for the FAK when shopping for the best freight quote.

Looking for The Best Freight Quotes Online?
Check Out The FREIGHT QUOTE SHOOTOUT Here!

Today I wanted to go over the “Limited Access” accessorial fee you may see on your freight quote. Limited Access ( or LTD Access for short ) refers to a location that is difficult for the truck driver to get to. Locations that fall under limited access would include: Amusement Parks, Construction Sites, Farms, Mines, Mini Storage, Places of Worship, Schools, Correctional Facilities and Military Bases.

Due to the inconvenience of getting freight in and out of these types of locations, which slows down the driver on their overall route, you will be charged a Limited Access accessorial fee on your freight quote. Depending on the freight broker or carrier you’re dealing with, you can expect to see a fee of anywhere from $50-$80. Again, as I say with any over priced accessorial charge,  if it’s any more than this, I would suggest at least attempting to negotiate this fee down.

In an effort to help you find the best freight quote last week, I decided to pick 4 freight companies online and have them give a freight quote for the same item. Some companies I used their online instant freight quote. Others I phoned in an spoke with an agent.  Here were the parameters I used:

Boxed item rated as FAK Class 125 at 250 lbs.

Origin: San Diego, CA 92101 Commercial Location with Forklift and/or dock

Destination: Atlanta, GA 30303 Residential Location with Liftgate

I discarded any quote that didn’t offer freight insurance or was covered for less than $5/ lb.

Here are the numbers:

FreightShippingDirect.com - $313.88

FreightShippingCenter.com - $433.90

FreightCenter.com - $460.34

Freight101.com - $468.12

As a continuing part on my series explaining accessorial charges, today I’ll go into Residential Pickup and Delivery Charges.

The reason for Residential Delivery and / or Pickup Charges for non commercial locations is due to the fact that there are a number of factors that impede a prompt delivery or pickup to the location. The reasons can vary from there being no loading docks or forklifts, the streets may be narrower and harder to negotiate in and out of for the truck driver and as general rule of thumb it’s simply just more difficult to pick up and drop off shipments in non commercial environments. Typically you can also expect a liftgate charge attached because there isn’t a loading dock for the driver to back into as discussed in my previous post.

You can expect fees for residential charges to range anywhere from about $50-$100 tacked onto your total freight quote or bill.

Once you’ve received your freight quote, you may see what are referred to as Accessorial Charges that are additional fees listed on the freight quote. In an effort to clarify your freight quote I will begin a series of posts that will explain what each of these fees mean and how they effect your delivery or pick up.

The Liftgate Charge is a fairly common accessorial fee. What is a liftgate? A liftgate is a hydraulic  accessorial device used to lower the pallet to from the end of the truck to the ground level.

Typically this is used for items leaving from or going to residential locations or those locations where there is no loading dock or there is no forklift available.

If you do not opt for a liftgate, the driver is only responsible for taking your shipment to the end of the truck and you must take care of gettig the pallet off of the truck.

You can expect to be charged anywhere from $50-$125 for the liftgate fee depending on your freight rate structure. If the liftgate accessorial charge is any higher than this, you shoud consider attempting to negotiate for a lower liftgate charge.

Looking for The Best Freight Quotes Online?
Check Out The FREIGHT QUOTE SHOOTOUT Here!

Having worked in the trucking industry for many years now I have seen just about everything the shipping and freight industry has to offer — the good and the bad.

Back in the day (as my grandkids say) all LTL (less than truckload) carrier rates were based on published tariffs and no discounts were applied. What the teamsters wanted to charge that year is what you paid - government regulation protected the carriers from competition and the teamsters union was able to control the industry through master agreements with all the major freight transport companies.

In 1979, that all changed thanks to Jimmy Carter and the Deregulation Bill, that protective shield of regulation was stripped away and a lot of the bigger carriers began dropping like flies. Ringsby, Truck Lines, Denver-Chicago, Leeway, ICX, Transcon, ONC, Delta Truck Lines and McLean were some of the bigger names that fell in post-deregulation America. With the frontiers now open, a lot of smaller, regionalcarriers began movie towards the West Coast and the North East and the compeition kicked in to high gear. Some companies began to offer insane discount levels of 45%-50%…now, they were also increasing their rates by similar levels.

This caused the development of FAK (freight all kinds) pricing. The term FAK means a mixture of different product types delivered in a combined load to a single or limited number of destinations. Instead of figuring out the classification and rate for each product, carriers determine an average rated which is applied to the entire shipment. This makes this easier for everyone involved and makes creating a bill of lading or freight bill much more simple. Interestingly enough, the development of FAK priving coincided with a decrease in the number of headaches I had every day.

As a product of the old school of freight shipping, I think the 1960s and 1970s were the best years to work in transportation because management and union employees were forced to work more ethically together…and, unfortunately, that’s not something you find very often in companies nowadays.

Ok, I think I’ve rambled on enough for today.

If you missed my previous post about protecting yourself with freight damage or freight claims here’s a reminder:
Always Be Sure To Write Down Any Damage On The Delivery Receipt And Have The Driver Sign Off On That As Well Before You Take Receipt Of The Item.
A clean Delivery Receipt is basically telling the trucking company that the item was delivered in perfect condition and they’ll stick to that. I recommend that not only do you insepct the box, but you open the item as well while the driver is there. Make note of the outside of the box at very least no matter how trivial or minute it may seem. Even the most minor of blemishes on a box may be an indication of much bigger damage on the inside i.e., scratch on box, tear in corner, missing shrink wrap. So be sure to write this down on the Delivery Reciept and have the driver sign off on it as well.
This will give you the leverage to make a freight claim should any problem be discovered after the fact. If you don’t make any note on the delivery receipt, you have 15 days to make a claim, but don’t even rely on this. Do yourself a favor and make sure to make some notation on the delivery receipt for your own protection.
If you don’t you will lose 100% of the time against the freight carrier.
Don’t let the driver rush you or intimidate you, and if you feel like this is happening, call your freight agent immidiately and have them speak to the driver on the phone at the time of delivery about what you need to do in terms of making any notation on the delivery receipt.
If you don’t have time to do this, then get someone who is there that does have the time to receive the shipment. What takes a few extra minutes could potentially save you a ton of greif and money!

Do you review your Freight Bill and compare it to your original Freight Quote?

If not, why aren’t you? Besides the fact that it’s just a good habit, there are a lot of things you can learn from reviewing your freight bills but more importantly, you may start to catch discrepencies that you should bring up with the trucking company or freight broker that you’re dealing with.

If you discover discrepancies between the freight quote and the actual freight bill, You always want to find out what happened. Discrepancies happen for any number of reasons but the main reason to bring it up is that you can learn more about how things work and you send a message to the trucking company that you’re watching everything.

 What are some of the reasons that your freight bill varies from your original freight quote?

·        Liftgate – Did the trucking company add on a liftgate after the fact? If the load required a residential pick up or delivery, sorry buddy, there’s no way around it unless somebody in the neighborhood has a forklift. However, if this was a business to business delivery and there were loading docks or terminal pickup and/or delivery, there should have been no need for the liftgate.

·        Fuel Surcharge – With soaring gas prices the fuel surcharge goes up every week. If you sit on a quote, be prepared to see pricing go up the longer you wait to book the load.

·        Re-Weigh – “Uh, it’s bigger than a bread box” You guessed at the dimensions and the weight and the trucking company had to re weigh the item. I go over this on my previous post about Re Weighs.  

·        Misclassification or reclassification – This is the big one. You want to know your FAK Classification for the item you’re shipping out. There are 3PL (Third Party Logistics) Companies that will list the FAK on the freight quote. It’s always a handy piece of information to have, because sometimes trucking companies will re classify or misclassify the item(s) you’re shipping.

      Let’s use a common item for an example here. Take for instance a Wooden Chest in the NMFC (National Motor Freight Classification) book.

            The NMFC lists a Wooden Chest as item #80900

1. Sub 1  SU (set up) is listed as FAK Class 125
2. Sub 2  KD (knocked down) is listed as FAK Class 85

      Even though it’s the same item, the means by which it’s shipped will effect the class      and price of the bill. Be sure to know the exact dimensions and weight and how it was packaged because the trucking company may have not accurately Classified it. It could be either honest human error or someone decided to take liberties with reclassifying your shipment. That’s why it’s always good to work with a 3PL, Freight Broker or freight carrier that lists the FAK on the freight quote so you can compare it to the freight bill. Usually, as a customer, the freight bill is the only place you’ll be able to catch if a re-class has taken place.

So what happens now? Well the first thing you want to do is ask that your bill be explained and if the answer is not satisfactory, then request that the freight bill be recalculated and get your rep to help make those corrections on your behalf with the trucking company or freiht carrier. What separates the good Third Party Logistics companies and the bad ones are that the good 3PL companies are the ones that will help you with making these adjustments.