Why the lowest rates aren’t always the best rates in LTL

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Why the Lowest Rates Aren’t Always the Best Rates in LTL 

When you search for LTL shipping rates online, work with a 3PL, or call carriers, the first instinct is to look for the lowest available price. While price is certainly important, “cheapest rate” and “best rate” are not always the same thing. The cheapest rate is usually the best choice until issues arise, which are all too common in the chaotic world of LTL freight shipping. When something unexpected happens, you may find that the fine print attached to the cheapest rate has made a minor problem into a devastating one. That said, there are a number of other factors to consider when looking for the right carrier to move your shipment, and some of them are as important, if not more so than price. With that in mind, let’s take a look at some of the problems associated with some of the cheapest advertised rates and some of the other things to consider when shopping for the right quote for your shipment.


Cargo Liability Coverage

Significantly lower freight rates usually mean that corners have been cut somewhere. One of the ways a provider can reduce prices is by lowering the amount of cargo insurance coverage. Cargo insurance coverage is “all-risk” insurance that covers the cargo itself while in possession of the carrier, but if the coverage is slim and something happens to the shipment, you may be on the hook for most of the cost.


Incorrect Documentation

A 3PL salesperson from a cheap company may also try and talk you into declaring a questionably lower NMFC freight class for your shipment to get a better rate. However, in addition to the risk of having the freight inspected and reclassified (for an additional fee), the lower NMFC class also comes with a reduction in cargo liability coverage. The money you save upfront is not worth the lack of coverage on the back end or additional charges incurred if something were to happen to the shipment.


Lack of Customer Support

Another corner that is often cut by carriers or providers offering significantly cheaper rates is customer support. If an issue arises with your freight, you may find yourself waiting for hours on hold or sending emails with no responses in order to get the necessary information regarding your shipment, wiping out your initial savings by costing you time and money tracking down your freight.


Long Transit Times 

Sometimes cheaper rates are offered by carriers that lack the infrastructure to meet predicted transit times, resulting in long delays. If you save money on the front end, but your supply chain disruption ends up costing your business more than the difference between a cheap rate and a reasonable rate from a credible carrier, the savings are worthless. This is why it is important to get freight quotes from reputable providers that maintain good relationships with a reliable carrier network. This will ensure you get the best deal on the best service, not just the best price.


The Cheapest Rate Vs. The Best Provider

The right freight provider will deliver the best value for your shipment, which is a combination of risk mitigation, price, service, and capacity. LTL shipping can be a complex landscape to navigate, and while getting a great rate is important, it should not overshadow the other essential elements that will make your freight shipping experience a success.

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