Freight Bait: When The Price You Pay Doesn’t Match the Quote

The freight industry is a complex and ever-changing landscape, making it difficult for shippers to get accurate estimates of their freight costs. Transparency in freight pricing becomes crucial, granting shippers access to all the information determining the cost of their shipment, including carrier rates, fuel surcharges, accessorial charges, and other applicable fees. This empowers shippers to make informed decisions about carriers and cost management.

For instance, imagine a small business owner who needs to ship a large order of products to a customer across the country. Without transparent pricing, they might receive a quote from Carrier A that seems reasonable but doesn't include important surcharges and fees. Later, when the shipment is in transit, Carrier A adds unexpected charges, significantly increasing the overall cost. With transparent pricing, the business owner would have known about these additional costs from the start and could have chosen a carrier that offered a more accurate quote.

The benefits of transparency in freight pricing are manifold. It allows shippers to shop around for the best rates, compare quotes, and choose the most valuable option. For example, a manufacturer looking to transport raw materials can obtain quotes from different carriers, easily compare their offers, and select the carrier that offers the most competitive rate for the required service level.

Moreover, it reduces surprises, as shippers are aware of what to expect and avoid unexpected fees. Consider an e-commerce retailer that ships products internationally. Without transparency, they might be unaware of additional customs fees and taxes that some carriers pass on to the recipient. Transparent pricing would ensure the retailer includes these costs in their calculations and informs the customer of the total charges upfront.

Additionally, transparency fosters trust between shippers and carriers, increasing the likelihood of future business transactions. For instance, a logistics company that consistently provides transparent and accurate pricing will gain a positive reputation among its customers. These customers are more likely to return for future shipments, as they have confidence in the carrier's reliability and integrity.

In addition to transparent rates, carriers should also be open about their pricing process, ensuring shippers understand how rates are calculated, including base rates, fuel surcharges, and accessorial charges. An example of this could be a carrier providing a breakdown of how they calculate fuel surcharges based on fluctuating fuel prices and explaining the reasoning behind accessorial charges for specialized services like liftgate delivery or inside pickup.

The final freight price should align with the quoted price, with no hidden fees. If any additional charges arise after tendering the shipment, carriers should inform shippers and seek approval before shipping. For example, a freight broker who offers a flat rate for a shipment should ensure that the price they quote includes all relevant fees, so there are no surprises for the shipper or consignee down the line.

To obtain transparent freight pricing, shippers should request detailed quotes from carriers, compare multiple quotes, and consider factors affecting freight costs, such as weight, dimensions, distance, and time of year. Online tools are available to facilitate this process. For instance, some platforms allow shippers to enter shipment details and instantly receive quotes from various carriers, enabling them to make quick and well-informed decisions.

Furthermore, government regulations and industry initiatives can play a role in promoting transparency in freight pricing. For example, authorities might require carriers to disclose all charges clearly in their quotes and invoices, ensuring that shippers are well-informed before committing to a carrier.

Overall, transparency in freight pricing benefits both shippers and carriers by providing accurate estimates, reducing surprises, building trust, attracting more customers, and minimizing disputes. Embracing transparent pricing practices can lead to stronger, long-lasting partnerships between shippers and carriers and create a healthier and more efficient freight ecosystem.


Read More

Cross Dock

To Cross-Dock or Not Cross-Dock, that is the Question

April 7, 2023
One supply chain strategy companies depend on to keep their stores fully stocked is cross-docking services.