Introduction to Freight Shipping

Introduction to Freight Shipping

Freight shipping is defined as the process of transporting commodities, goods and cargo by land, sea or air. Freight itself can be defined as the goods transported by truck, train, ship or plane. 
Freight shipping is an important part of many business operations. This post will discuss the basics of freight, including what classifies as freight, different types of freight shipments, and how they can be used to support most ecommerce businesses

What classifies as a freight shipment?

Any shipment that exceeds the below criteria are considered freight and need to be shipped as such.

  • Packages exceeding 150 lbs
  • Packages exceeding 165 inches in length and width combined
  • Packages larger than 108 inches in length

If you are an ecommerce business working with a third-party logistics provider (3PL) most of these details will be folded into the decisions your 3PL will make on your behalf. It’s important to know that you have freight shipping options, and that all freight isn’t shipped the same.

What are the different types of freight shipments?

There are three main types of freight shipments: full truckload (FTL), less than truckload (LTL), and partial truckload (PTL). There is also intermodal freight and express freight.

  • Full truckload (FTL): Full truckload involves moving bulk or pallet loads that are large enough to justify the use of an entire semi-trailer, typically more than 15,000 pounds. Full truckload can be more cost effective and reduce the opportunity for freight damage with less handling than LTL.
  • Less than truckload (LTL): LTL is the transportation of relatively small freight. The alternatives to LTL carriers are parcel carriers or full truckload carriers. Parcel carriers usually handle small packages and freight that can be broken down into units less than 150 pounds. Full truckload carriers move freight that is loaded into a semi-trailer. Semi-trailers are typically between 26 and 53 feet and require a substantial amount of freight to make such transportation economical
  • Partial truckload (PTL): A partial truckload (PTL) shipment is between 6 and 12 pallets with a total weight of over 5000 pounds.
  • Intermodal: Intermodal shipping typically refers to shipping with a combination of rail and truck. However, it can involve a variety of transportation modes including rail, trucks or ships to streamline the shipping process. Including rail in your freight shipping can reduce fuel use, lower costs and offer a reliable method of shipping.
  • Expedited: Expedited freight refers to time-critical shipments in which freight has to be delivered quickly. Expedited freight is most often transported by truck or air.

What is Freight Classification?

Freight classification is a standardized method designed by the National Motor Freight Classification (NMFC) to give consumers and carriers a uniform pricing structure when shipping freight. It measures an item’s transportability by density, stowability, liability, and ease of handling. Class numbers are between 50 and 500. There are 18 freight classes, with Class 50 being the lowest and Class 500 the highest. The higher the class, the higher the rate of every hundred pounds you ship.

Calculate Your Freight Class

In order to complete the accompanying section on your Bill of Lading, you will need to calculate your shipment’s NMFC Freight Class. As previously mentioned, most professional carriers will be able to help you with this by taking into account your shipment’s density, stowability, handling and liability. As any of these poses greater challenge or risk to the carrier, the freight class and cost of transportation also rise.

How Much Does it Cost to Ship Freight?

The cost to ship freight is dependent on many aspects. While deciding which freight carrier to use for transportation, you should review and compare pricing each company offers. The following are the main factors that determine freight shipping rates:

  • Dimensions
  • Mode of transportation
  • Density
  • Weight
  • Stowability
  • Liability
  • Freight class
  • Packaging
  • Facility type at shipment’s origin and destination
  • Time sensitivity

It’s imperative that you have the most precise information possible before getting a freight quote, especially if you’re using a freight rate calculator. The more precise your information — like weight and distance — the more accurate your quotes will be.

 

Freight Shipping with a 3PL

An established 3PL specializes in overseeing some or all of your supply chain and logistics operations. A 3PL will take on picking, packing, inventory management, order management and processing, reporting, shipping and distribution, as well as return logistics. Other common tasks that companies outsource to 3PL providers include: domestic transport, international transport, warehousing, customer brokerage, and freight forwarding.

Unless you have the in-house resources to manage all the services that 3PLs offer, chances are that your company can benefit from hiring a 3PL provider to outsource your logistics and ecommerce fulfillment. When you hire a company to handle all of your supply chain needs, and their many benefits that come along with it. You will probably notice increased order accuracy and find you have more time to focus on growing other parts of your business. In addition, you will have the advantage of a low upfront capital commitment since you do not need to spec and build out your entire logistical supply chain. Above all, when you hire a trusted 3PL provider, you will have more time to focus on important tasks such as your business development, sales, and marketing. While most 3PL providers can be full-service, you also have the option to take advantage of a partial segment of the services they offer, while excluding the ones that your business does not need. And many 3PLs provide the flexibility to scale up or down depending on changes in product demand or, seasonality that commonly occur, or long-term business growth.

The need for 3PL providers continues to grow as the logistics industry becomes more and more complex. It has become difficult for small and even medium sized companies to keep up with the consumer demands of same-day delivery and constant product iterations and updates. It no longer makes sense to monitor all of the latest developments in the industry and  figure them out on your own. It’s become increasingly impossible to determine what the exact needs your company are based on an industry with so much flux. 3PL providers not only free up valuable business time, but they can offer expert advice and assistance with many logistics decisions to help you ensure your are managing your product company with the most efficient processes.

“By moving our inventory to Louisville, we got a much higher proportion of our freight to a lower cost option. We were able to see significant cost savings because of Louisville’s excellent location.” Christian Gormsen, CEO at Eargo

Christian Gormsen CEO, Eargo

Freight Shipping with a Freight Forwarder

Managing the transportation of goods domestically and internationally requires knowing many various shipping regulations, tariffs, and other factors that change often. If you have a product company with an international manufacturer or global customer base, utilizing a freight forwarder will be a good option for your company to navigate import and export compliance.

In general, freight forwarding is the coordination and shipping of products from one destination to another utilizing either single or multiple carriers. A freight forwarding company acts as an intermediary between a shipper and various other transportation services; they are not the actual freight movers. They can provide of a full range of services from managing and tracking land based transportation, negotiating rates for freight shipping, booking cargo space, preparing the necessary shipping and export documents, and even filing insurance claims should they be needed.

One of the main reasons that companies choose to use freight forwarders instead of working directly with carriers,  is that freight forwarders offer rates that companies may not be able to get on their own. They use their relationships with carriers—including air freighters, trucking companies, rail freighters, and ocean liners—to negotiate the best possible price to move their client’s products. They also have highly specialized knowledge of the regulations, transportation costs, documentation requirements, and banking practices that can make the movement of your products simpler and more efficient. Regardless of the size of your products, freight forwarders are able to handle all the required export responsibilities and take the onus off your company.

Bottom Line

The benefits of LTL and freight shipping have always been clear. Combine bulky, large, and heavy packages to fit into the tightest, non-damaging space possible and get palletized shipments to a common delivery area, if not within a small radius of the given shipment. The main advantage to using LTL is that a shipment may be transported for a fraction of the cost of hiring an entire truck and trailer for an exclusive shipment.

 

There are many benefits to working with a 3PL, if you are seeking logistics support we’d love to hear from you. You can read DCL’s list of services to learn more, or check out the many companies we work with to ensure great logistics support. Send us a note to connect about how we can help your company grow.

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