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.

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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

From the shipper’s perspective, are freight agents something you should be concerned with or worried about? The answer is no.

The Freight Industry has many different jobs within in it and common practice is for a freight agent to sign on in an independent contractor or employee capacity with a freight broker. The freight agents and the jobs they do are vital to the industry. The freight agent is not usually an employee, but uses a freight company that the agent can get a competitive rate to move shipments for their book of clients in order to pass along better pricing to their customers. Indeed, freight agents are definitely wanted.

As long as the freight company is using top line carriers then there shouldn’t be any any problems out of the ordinary.

In the freight industry, business is done like this all day long.

Why would it be done like this? Let’s give you the basic run down. An agent may have years of familiarity with a specific company. The freight agent has great expertise in handling that particular shippers freight and so the shipper is comfortable letting the freight agent handle the freight. The freight agent doesn’t have any of his/her own rates in place with any major carriers. That said, the agent will look for a reliable broker that has freight rates already negotiated down and in place with major freight carriers. This is very common within the freight industry.

Remember, what should be most important to you is that good top line freight carriers are used. This is one of the ways you, the shipper, can protect yourself.

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.

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.

I’ve had a number of readers bring up instances where a freight company revises their bill after they’ve agreed to the freight quote. I’ll address several situations that seem to be the most common in terms of revising or adding to the initial freight quote.

When is it fair for a Freight Company to charge you AFTER the Freight Quote has been agreed upon?
When you have given them inaccurate or “ball park” information with regards to the weight and dimensions of your load or incorrect information about the type of delivery or pick up location is. Guessing at the shipping dimensions is a gamble. On the one hand, if it appears close enough, then it may go through without a hitch, however, if it’s obviously not what you told the broker and the freight carrier gets suspicious, it will call for a re-weigh (I’ll talk about re-weigh issues in another post) and if it proves to be different than what you told the broker, than the difference will be charged to you and rightfully so. This brings up the question how much more will I be charged?
Here’s just one example: If you guessed that the item was 500 lbs and it is reweighed at 600 lbs., expect roughly to be charged an additional $50 - $100. Again this is just one example, and the type of commodity the item is will play a factor as well.

When is it NOT appropriate to be charged AFTER the Freight Quote has been agreed upon?
It is NOT appropriate for a Freight Company to charge you for an Interline or Agent Transfer (when there is a hand off to another freight carrier that finishes the last leg of the delivery.) How it gets there is something that should have been worked out before the freight company ever issued you a quote. The freight company already has their lanes figured out and should an Interline or Agent Transfer occur, you should never be involved in this detail. It’s not your problem as a customer. You are paying the Logistics Company to take care of the logistical issues.

What does FAK stand for? FAK stands for Freight All Kinds. FAKs are determined by the NMFC or National Motor Freight Classification, which publishes a book annually, that lists every type of commodity that can be shipped. FAK or Freight All Kinds are arrived at in part by the weight, density, volume and material of the item.

Each commodity falls into a different class of FAK. The smaller and more dense the commodity is, the lower the FAK. The bigger and more airy it is, the higher the FAK is. For instance, smaller solid heavy metal plates and parts are rated at FAK Class 50 being that they’re small, dense and very heavy. Soft items such as pillows on the other hand may fall into FAK Class 300 or 400 because they’re big, and take up a lot of space in the truck and are light weight. That said, the best rates will always be for heavier items that take up less space on the truck.

Learn what the actual FAK of your commodities are. Watch out for any company that rates your FAK higher than it actually is. If anything, try to get a lower FAK than its actual class. Visit the NMFC and purchase the NMFC book HERE

In an industry where fuel surcharges are skyrocketing, the freight companies that are trying to offset the price increases by lowering your FAKs below their actual class for you are the companies you want to be doing business with. Your actual class and FAK will be based upon your volume of freight.

Here is a listing of all the FAK Classifications:
· 50
· 55
· 60
· 65
· 70
· 77.5
· 85
· 92.5
· 100
· 110
· 125
· 150
· 175
· 200
· 250
· 300
· 400
· 500

Looking for The Best Freight Quotes Online?
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It chills my bones thinking about how much money is handed over to freight carriers because the customer took receipt of a freight damaged shipment without looking over the product, signed off on the delivery reciept and didn’t make any notation on the delivery reciept.

Freight carriers are notorious for having all their bases covered to protecting themselves against having to pay out against any freight claims that they’re responsible for. I don’t blame them. They know what can happen during transit. So, my dear readers, it’s up to you to protect yourself so that should any damage occur to your shipment that you are armed with the information you need to be reimbursed for any damages.

Here are some basic things you need to be aware of:

• If any freight damage is visible on your shipment no matter how minor it may seem at the time of delivery, write it down on the delivery reciept. This will proctect you and give your freight broker the leverage to securing you compensation. This includes any small scratches, scuffs or anything that may cause the item or box that it may arrive in to look less than pristine.
• If you do not make any notation on your delivery receipt and then find that there is freight damage you only have 14 days to contact the freight carrier to alert them to the damages to your shipment. Some freight brokers may not even help you if you didn’t list the damage after the fact, so again, it’s better for everyone if you take the time to make any notes on the initial delivery receipt before you sign off on it. If you took the time to make any notes about damage on the Delivery Receipt, you have up to 9 Months to make a freight claim!
• If you feel unsure or rushed or intimidated by the driver, you may want to call your freight broker for advice and maybe even have a conversation with the driver before you take receipt.
• Take photos of the item while the driver is there with the truck if you can if there is any visible freight damage. If not be sure to take them before yo uunbox the shipment and after.
• Do not take your time to getting around to examining the delivery weeks after taking receipt of the shipment. Do this ASAP. Every day counts if you didn’t make note of anything on the D.R. during the delivery.
• If you feel that the item is damaged or you feel unsure about it’s condition, you are well within your rights to REFUSE DELIVERY.

Some customers take it a step farther by:

• Taking a photo of their load as it appears prior to being delivered. If you want to be even more thorough, take pictures from multiple angles and if you can take a quick snap of the item being loaded on the truck even better.

So many times I’ve seen freight carriers deny freight claims because the customer didn’t do a few simple things that could have ensured them compensation for damages that occured enroute to the shipping destination. If yoy don’t follow these tips, I can say with almost 100% certainty, that you will be automatically denied your freight claim without even an investigation.

So to sum up: The Delivery Receipt is Your Life Saver. Don’t sign it without taking the time to make any notes of even the most minor of freight damage!