June 13 2022
In today’s tight market, comprehensive truckload freight operation can be delicate. Shippers want to keep their
customers happy, improve their performance, and stay within their budget. This is why businesses are looking for
strategies to acquire truckload freight capacity and hire high- performing carriers. There are several recommended
practices that can improve your truckload freight performance if you are looking to optimize your FTL strategy and
freight operation.
Extending carrier network :
The key to having greater freight capacity opportunities is to have a large network of
reliable, high- service
When you have a variety of options, you are more likely to discover the capacity and carrier
you need for your specific freight requirements. Make sure to keep a network of carriers on hand, or engage with
logistics services who can connect you with thousands of indigenous and public carriers.
Boost Supereminent time :
The performance of your truckload freight is largely dependent on lead times. To begin with,
a longer lead time boosts your chances of obtaining the best transportation choice in terms of service, equipment ,
and cost. Away from that, having further room to reserve the truck means you will be suitable to predict delivery
dates with greater accuracy . It’s doable to arrange shipments with a lead time of 5- 6 days or further. Still, the
longer the time between placing an order and closing a contract, the more likely your package will arrive on time,
successfully delivered, and with all of the services you bear.
Use The Right Software :
Without readily developed software, it’s nearly impossible to manage and optimize freight transportation. Having a
reliable transportation operation system allows you a lot of inflexibility in terms of shadowing and assaying once and
current shipments, as well as soothsaying and planning
With software , you can easily manage your truckload freight, as you can search carriers in your area, plan shipments,
record data, track and dissect freight performance, and uncover gaps and openings for optimizing any process you can
suppose of.
In general, advanced and well thought out preparation is the key to high- performing FTL freight. While the
transportation operation system provides you with a detailed picture of your freight transportation process, expanding
your carrier network and shortening lead times could help you improve functional performance and save money.
Full Truckload Issues And How To Avoid Them
The pandemic, inflation, surging product demand, and driver shortages have challenged logistics managers to discover
innovative solutions. While logistics managers face many challenges, few are as crucial as full truckload shipping.
Regardless of where you ship cargo, all of it goes on trucks before reaching its destinations. We will outline some
common FTL truckload (FTL) issues and how to avoid them.
Volatility of Rates :
High inflation numbers and a labor shortage are pushing rates higher. The government is tightening the money supply by raising interest rates several times this year. As a result, higher interest rates slow down the economy as mortgages and other loans consume a higher percentage of consumers’ budgets. The rate hikes reduce the demand for e-commerce, and we have already seen it happen. Amazon only reported 7.3 percent year-over-year revenue growth for the first quarter, a sign of slowing e-commerce demand. April’s CPI inflation number was 8.3 percent. Although it was slightly lower than March’s 8.5 percent reading, it is still near the 40-year high.
These developments can cool down demand and help logistics managers keep up with deliveries, but what should you do now? If a customer makes an order, you still have to deliver it. Logistics managers can raise shipping costs to help offset higher rates. Passing some of the costs to customers will increase your profitability per transaction. Some customers may walk away, but you should not deliver cargo that hurts your bottom line.
As demand cools, logistics managers should consider establishing contract prices for their freight deliveries. Contract prices provide some protection in case rates surge. You can use the contract rate within a specified timeframe instead of relying on the spot rate. Using contract rates for some deliveries protects you from rising rates while keeping money aside for spot rates lets you capitalize on short-term dips in freight rates. Rates vary for each shipper. These variances make it important to check with several solutions instead of doing all your business with a single shipper.
Knowing your profits on each order helps you establish which rates and customers you can accept. For example, you can determine if it makes sense to raise your prices to pass costs on to customers or if your profit margin is wide enough to weather the volatility of rates.
Lack of Planning — Not being Organized :
Supply chain data and developments move quickly. It’s easy to get trapped at the moment and react to what is happening. Lacking a plan can lead to emotional decision-making, worsening a tough situation. Contract rates mitigate risk by providing you with protection from rising rates. Logistics managers can explore several warehousing solutions and build new relationships. Even if you do not work with a new partner right away, expanding your network provides more choices.
Building up inventory is another way to stay ahead of the curve. An ample inventory supply gives you more time to wait for attractive prices. You will not have to rush at the next available opportunity and risk paying a higher price. Scrambling to fulfill orders can also result in no openings. Other shippers can beat you to getting available FTLs due to planning further ahead. Instead, keep a shipping schedule to determine when you need to deliver freight. You can also use freight technology and apps to streamline this process.
Some logistics managers spend too much money on rates, seeking to grab every deal. These logistics managers risk overextending themselves and turning profits into losses. Consider your current commitments before spending additional money on contract and spot rates. Logistics managers can prioritize more profitable freight that can get shipped in a dry van. For example, Hazmat, reefers, and tankers have higher rates. You can also pass these costs on to customers.
Fuel Charges :
Fuel charges fluctuate every week before the pandemic. Gas shortages have led to significant price hikes and narrower profits. Carriers pass the costs onto shippers, and you will have to pass these costs onto your customers. Each carrier has a different fuel surcharge policy. Base fuel rates and base fuel mileage are the two most common structures. High base rates can mean lower surcharges, but this is not always the case. Steer clear from carriers that do not explain their surcharges or try to keep it a secret. Logistics managers can choose from many carriers instead of opting for cheaper options.
Logistics managers can negotiate lower surcharges by providing carriers with higher order volumes. Carriers may make some concessions to welcome a long-term client who pays well. You should reach out to long-term partners and ask about their policies. Some carriers may have made changes due to the ongoing tension in Ukraine. Lower gas supplies have led to higher prices, but some countries are mulling if they want to tap into additional gas reserves. These developments can lead to dramatic swings in fuel prices.
Contact us today to learn more about
. We can provide quick and easy solutions for all truckload issues you may be experiencing right now.
