Freight shipping services are an essential part of transporting goods throughout the global economy for businesses through various freight modes to deliver their supply chain and logistics requirements. The main topics of this blog are to discuss the various freight shipping options available to shippers, touch on specialized needs of some industries and outline factors that drive freight shipping rates to help you make informed decisions when selecting from available freight shipping options for your business.
Freight shipping is used by businesses to move massive amounts of products worldwide by using various modes of transportation such as ships, planes, trains, trucks and a combination of multiple modes to deliver items to customers.
Let's explore the definition of freight and its common characteristics along with the role it plays in global supply chains.
Freight transportation refers to the bulk movement of goods from one location to another using different modes of transport that can either travel via air, sea or land through the following freight modes: truck, rail, plane, ship or a combination of two or more which is called intermodal.
The main characteristic of freight shipments is the size, weight and the number of options available to ship from and deliver to an infinite number of combinations, with the infinite number of combinations being the biggest challenge for the freight and logistics industry.
Other factors to consider when moving freight include:
In today's interconnected world economy, raw materials are sourced globally while finished products reach customers across continents; efficient logistics play a vital part in ensuring smooth operations. Freight shipping is the backbone of these global supply chains, enabling businesses to transport large volumes of goods cost-effectively and reliably.
Some key roles that freight shipping plays in global supply chains include:
Understanding the basics of the freight shipping options in today's supply chain market are essential for any business looking to optimize its logistics processes. From knowing what constitutes a freight shipment to recognizing its importance in global supply chains, this knowledge will help you make informed decisions when selecting suitable carriers and shipping methods for your company's needs.
Key Takeaway:
Freight shipping involves moving large and heavy items using various modes of transportation. It plays a crucial role in global supply chains by providing economies of scale, reliability, flexibility, and risk mitigation. Understanding the basics of the various freight shipping options is essential for businesses to optimize their logistics processes and make informed decisions when selecting suitable carriers and shipping methods.
Freight shipping is quite remarkable when you think about it because it can transport almost anything from an infinite number of origins to an infinite number of destinations, making it a vital part of the global supply chain. While freight can handle most items, some require specialized carriers due to their nature or value. Let's explore some common examples of items requiring freight delivery and those needing specific handling.
In addition to these common examples of goods shipped, certain items demand unique attention from specialized carriers because they pose risks during transit. These include hazardous materials (HAZMAT), perishable products, product specific temp-controlled or valuable commodities with high theft potential. Let's take a closer look at each category:
Investigating all the available freight shipping options and picking the best is essential for businesses looking to transport their items in a productive and cost-efficient manner. By understanding the types of items commonly shipped via freight services, companies can make informed decisions about which mode of transportation best suits their needs while ensuring safe delivery of their valuable cargo.
Key Takeaway:
Freight shipping is a crucial part of the global supply chain that can transport almost anything, from furniture to construction supplies. While most items can be shipped via freight services, certain goods require specialized carriers due to their nature or value, such as hazardous materials, perishable products, product specific temp-controlled and valuable commodities with high theft potential.
Freight shipping is crucial for transporting goods across the country, and there are various modes available to cater to different shipment requirements. The type of freight service you select will be contingent upon a number of variables. In this section, we'll explore various freight shipping options: Full Truckload (FTL), Less Than Truckload (LTL), domestic 53’ intermodal transportation, expedited air, rail and ocean.
Full Truckload (FTL): FTL is ideal for large shipments that require an entire truck's 53' capacity. This mode offers several advantages over other methods; it provides faster transit times since there are no stops or transfers along the way; and has the flexibility to handle any origin to destination combination. Truckload shipments can also bring refrigerated trailers for perishable items or flatbeds for oversized loads going to construction sites.
Additionally, truckload minimizes handling risks because your cargo remains untouched from origin to destination.
Less Than Truckload (LTL): LTL is perfect for smaller shipments that don't need an entire trailer's space, but exceed parcel carrier limits. By consolidating multiple customers' freight into one vehicle, carriers offer competitive rates on freight that a shipper cannot utilize a full trucking trailer, hence its name.
However, LTL may take longer due to additional stops required during transport dues to transfer between trucks at cross-dock centers before reaching their final destinations, as LTL carriers use what is called a hub-and-spoke network to drive the efficiencies in this freight mode.
In some cases, combining different modes of transportation can offer significant advantages in terms of cost savings and environmental impact. Intermodal freight shipping involves using two or more transport methods (e.g., rail, trucking) within a single journey.
For example, an intermodal shipment begins with a truck that arrives at the origin dock with a 53' intermodal container positioned on a chassis. Once the shipment is loaded the truck takes the intermodal container to the rail intermodal ramp where it is lifted onto a rail well car to then proceed on its long-haul portion of the shipment to the destination ramp. Once at the destination ramp, a truck arrives with a chassis that the intermodal container is then transferred off the train. The truck then delivers the goods to its final destination where the product is removed from the container.
The primary benefit of intermodal transportation is that it allows businesses to leverage the strengths of each mode while minimizing their weaknesses. Rail transport offers lower fuel costs per mile and offers a more sustainable solution compared to trucking, while truck provides the flexibility of being able to pick-up and deliver freight from just about any location. By combining these methods strategically through an experienced logistics provider optimizes both cost efficiency, eco-friendly alternative and service quality.
Air freight services involve transporting goods via airplane rather than by truck or train. This method of transportation is typically used for high-value or time-sensitive shipments that need to reach their destination quickly. However, because of its higher cost compared to other modes of transportation, it's important to consider whether the benefits outweigh the additional expense.
Shipping products across the ocean can be a cost-effective option for companies looking to transport large quantities of goods.
For businesses seeking efficient and cost-effective shipping solutions, rail freight services offer a compelling alternative to traditional truckload transportation.
Of all the freight shipping options, rail transport is the least understood among common shippers because of its specific use within a select group of industries. Rail freight is particularly advantageous for long-distance shipments or those involving large volumes of goods. If your company regularly ships heavy, bulky products across state lines or coast-to-coast, rail service could be an excellent fit.
Besides distance and volume considerations, certain types of cargo are better suited for train transport than others. For instance, commodities such as coal, grain, or other bulk items often move by rail due to their weight and size.
Given the various factors influencing freight shipping rates, businesses must be knowledgeable of them to make informed decisions when selecting carriers and services. By understanding the variables that affect freight shipping costs, businesses can reduce expenses while ensuring quality freight transportation service. As a general rule the lowest cost per pound to the highest cost per pound on the freight shipping options available are as follows:
But to really grasp the full impact of cost one needs to look at the various factors driving freight costs in order to optimize service, cost and capacity requirements for the business.
The overall size and weight of your shipment play a significant role in determining the cost of freight transportation. Carriers typically charge based on either dimensional weight (the volume occupied by your goods) or actual weight (the physical mass), whichever is greater. As such, it's crucial to accurately measure both dimensions and weight before requesting quotes from different carriers and selecting the correct mode that best meets the need.
The answer is not always straightforward on dimensions and weight. As a general rule, as the total shipment weight approaches 8,000 pounds and more the shipper should quote truckload pricing because it will most likely be cheaper than LTL. Similarly, if the dimensions of a shipment approach 30% or more of the dimensional capacity of a trailer a shipper should make comparisons between truckload and LTL to ensure the best price.
The distance between the origin point and destination directly affects fuel consumption, driver hours, equipment wear-and-tear, as well as other logistical considerations. Consequently, longer distances generally result in higher shipping costs. Additionally, remote locations may require specialized equipment or additional time for delivery - further increasing expenses.
Rising fuel prices often lead carriers to implement surcharges that are passed onto customers. These fees vary depending on market conditions but can significantly impact overall shipping costs if not accounted for properly during rate comparisons.
Furthermore, accessorial charges cover extra services provided by carriers beyond standard pickup/delivery tasks - such as liftgate usage or inside deliveries - which also contribute towards total expenditure.
The United States trucking industry specifically operates under a standardized classification system called National Motor Freight Classification (NMFC). This system assigns a class to each type of product based on factors like density, stowability, handling and liability. Higher classes generally correlate with higher shipping rates due to increased difficulty or risk associated with transporting the goods.
To ensure you're getting the best possible deal for your freight shipment, it's essential to compare rates from multiple carriers. Online tools can help simplify this process by providing instant quotes from various providers based on your specific needs - including budget constraints, timeline requirements and desired delivery dates.
Key Takeaway:
Understanding the factors that determine freight shipping rates is crucial for businesses looking to reduce costs and improve efficiency. These factors include total capacity consumed, distance traveled, destination location, fuel surcharges, accessorial charges, and classification. To minimize expenses, companies can negotiate contracts with preferred carriers, consolidate shipments whenever possible, select appropriate service levels based on transit times needed and avoid unnecessary accessorial charges by providing accurate information upfront.
Understanding freight shipping documents is essential for any company involved in the transportation of goods. These documents serve as a contract between the shipper and carrier, outline what's being shipped, provide instructions for handling and delivery, and are used to resolve any disputes or issues that may arise during transport.
The Bill of Lading (BOL) is perhaps the most crucial document in freight shipping. It acts as a receipt issued by a carrier acknowledging they have received specified goods from the shipper. The BOL also outlines terms for transporting these items to their destination.
A Packing List details exactly what is included within each shipment - such as item numbers, descriptions, quantities, and weights. This information helps carriers handle shipments correctly and aids customs officials with inspections if necessary.
This document provides critical data about your transaction including seller/buyer details, description & value of goods, etc., which can be important for customs purposes when shipping internationally.
The Freight Bill or Carrier’s Invoice is essentially an invoice from the carrier detailing all charges related to your shipment – like pickup/delivery fees or fuel surcharges among others.
If you’ve opted to purchase additional insurance coverage beyond what’s typically offered by carriers through their limited liability policies; this certificate will provide the proof required in a cargo claim.
In summary, understanding the factors determining freight shipping rates is crucial for businesses looking to optimize their supply chain operations while keeping costs under control. By carefully considering variables such as total capacity consumed, distance traveled, destination location, fuel surcharges, accessorial charges, and classification, companies can make informed decisions when selecting carriers and services, ultimately reducing expenses and improving overall efficiency within their organization.
Streamline your supply chain and reduce costs by understanding the different freight shipping options available across all freight modes.
Factors such as product size, distance traveled, and delivery timelines should be taken into account when determining the best mode of transport for your goods.
Make informed decisions about how to get your products from point A to point B in the most efficient manner possible.
Check out these credible sources for more information on freight shipping and don't always look to the largest freight providers in the industry. Often the best answers will come from the medium-sized logistics companies that are of the size to have high quality teams and the time to sit down and explain your company's freight shipping options in detail.
If you're looking for help deciding on the freight shipping options for you, let us know by filling out our brief Request a Quote form. We'll be happy to get back to you to discuss your unique needs. If you need more information about this or other freight topics, browse our Freight Guides for free eBooks and comprehensive articles, or check out more of our blog.