You might think initially that Full Truck Load shipping rates would be easy to calculate, since basically the vast majority of carriers do the calculation based upon mileage. And that is partially true however; there are a lot of factors that come into play. So let’s try to demystify the process, in order to become a bit more informed about the subject and better equipped to reach a more informed decision on the rates that you are presently receiving.
Compare Shipping Rates
The first thing to do in order to compare the truckload shipping rates you are receiving from various carriers is to learn how to use Google Maps. Google Maps can be found by going to Google.com and looking for the Google Maps tab on the upper left side of the page. Once there, you can calculate the mileage between the two points that you are shipping. This will give you a constant that you can use to determine what you are paying per mile. This is a great way to do a comparison without having to invest in PC Miler that the industry uses which can cost as much as 1500 dollars. By the way, since you are using Google maps and establishing a price based upon one constant, the fact that PC miler may be more accurate ( by a slim margin, by the way ) is of no consequence to the numbers you are going to get as a result of this exercise.
Use Rate per Mile to Compare Rates
So now that you have a way to compare the Full Truck Load shipping rates you are receiving, based upon a rate per mile as carriers do, can you use this rate for all of your truckload shipments? Well no, since a few other things have to be taken into consideration. The first of which would be the total number of miles to each destination. I have always categorized shipments as being short hall from 0 to 500 miles, medium hall from 501 to 1000 miles, and long haul from 1001 miles plus. If you have shipments that vary in mileage and are within these 3 categories, you will start seeing a pattern where prices will be closely related in price range within those groups.
Inbound or Outbound load
Another issue is if the carrier is doing an outbound or inbound load. In other words, if you are in Montreal and your shipment is heading to Chicago, you would call it an outbound shipment. However if being based in Montreal and your shipment is to be picked up from Los Angeles and returned to your city, that would be considered and inbound load.
Carriers will charge more from their Home Operation
Why is this important? Well, carriers will usually charge a bit more out of their home location so that they can, if required, accept less revenue coming back., thereby assuring a fast turnaround. This can sometimes can be affected when dealing with cross border cargo supply and demand. When there are reduced exports from a country due to exchange rates, but a lot of imports, as in recent months between the United States and Canada, carriers feeling the imbalance are willing to head outbound for much less, knowing that there’s a lot of freight inbound from the USA.
Load Brokers are great source for Shipping Rates
As you can see, there are a lot of things that interplay in Full Truck Load shipping rates, and why they ebb and flow at any particular point in time. What a lot of manufacturers are doing today, is they are contacting third party logistic firms, otherwise known as load brokers, who know the ins and outs of the market. I would even recommend contacting a few and as you work with them, you will probably feel comfortable with 1 or 2. At that point, you will definitely be ahead of the game in getting competitive truckload shipping rates from both, thereby securing a competitive rate for your transportation needs.