A guide for Freight Shipping on eBay
When shipping an item via Motor Freight take the time to compare all the options available to you. Be an informed shipper!
How Freight Pricing Works
Less than Truckload companies use several methods to determine the price they charge ship an item for you. The most common is Freight Class. The National Motor Freight Traffic Association issues a publication called the National Motor Freight Classification or NMFC. This serves as the rule and guide to the trucking industry and is used to determine the classification of shipments. The price you pay to ship an item is directly tied to its stated freight classification.
Shipment density is calculated to determine how many pounds per cubic foot your item is. This tells the carrier how many other shipments will practically fit into a trailer with your shipment in order to fill a trailer effectively and profitably. Dense items such as building materials, steel, engines, machinery, ect have low classifications such as Class 50 thru 85. The lower numbered classes are the least expensive to ship. Another factor that determines freight class is the item’s likelihood for damage.
Fragile or bulky items fall into freight classes 92.5 to 500, and account for the highest of shipment cost. Your service provider should be knowledgeable in determining freight classifications and assist you in determining the freight class free of charge.
Brokers sometimes have been granted FAK or Freight All Kinds pricing with the carriers they contract with. What this means is higher classed items are shipped at a lower cost classification. As an individual shipper, the only way you can benefit from this type of pricing is to utilize a broker. Trucking companies do not offer this type of discounted pricing to private parties in most cases.
Full Truckload pricing is generally computed by the mile. The trucking company factors the operating cost per mile, adds a markup which totals the rates you pay.
Obtaining Discounts:
More often than not you will realize a big savings by dealing with a freight broker instead of contracting directly with a trucking company. Brokers can instantly shop the marketplace and obtain lower rates for you than if you tried to hire a trucking company yourself. In the Less than Truckload marketplace, private individuals are usually only provided a “Courtesy Discount” from the carrier’s published rates.
By using a freight broker your pricing will be lower than dealing direct with the carrier because the broker’s pricing is based on the shipping volume he provides the carrier. Brokers typically receive 50% to 85% discounts from published rates, where a private individual may only be offered 5%-30% discount by the carrier.
Don’t be afraid to negotiate with the broker on the price they give you, they are making a profit on your shipment and may be willing to negotiate the shipping cost with you. The worst they could say is no right?
Do Your Homework:
Shop smart when pricing your shipment cost by sampling rates from several brokers. By obtaining rates from a few different providers, you will find quite a contrast in the pricing they offer.
Ask the Broker or Forwarder for a copy of their Federal Operating Authority. Freight brokers / forwarders are required by Federal Law to be licensed by the Federal Highway Administration. Avoid unlicensed brokers and forwarders, if they working outside the law by not having a Federal Operating License, you will have no protection in the event of a problem. If you choose to deal directly with a carrier, demand for them to provide you proof that they are licensed to transport your shipment, and verify the documentation they provide at the US DOT Website. Any person who transports and item across state lines is required to have a Federal Motor Carrier Number and Cargo / Liability Insurance.
Be sure to call the insurance company and ask if the policy is valid, and what coverage is available to you in the event of damage or loss. Many carriers have restrictions on their insurance policies that require them to stay within a certain distance from home, be sure to fully inform the insurance agent of the origin and destination of your shipment, how it is packaged and what coverage they will be able to provide in the event of damage or loss. The internet is full of websites operated by unlicensed and inexperienced brokers and forwarders. Be sure to question the broker as to the amount of insurance coverage they will be offering on the shipment. Don’t make the assumption that insurance is provided or let them convince you that “the carrier insures it”. Many providers offer little or no cargo coverage, and in the event of a damage claim, you may find yourself having losing hundreds if not thousands of dollar due to uninsured losses. Ask the broker or carrier what procedure they have in place regarding freight loss or damage claims. If they do not have a solid plan in place, BUYER BEWARE!
Accessorial Fees and Cost Saving Tips
Every time the trucking company performs any sort of special service outside their normal duties, additional fees are usually accessed. The amount of these fees varies by provider and quite often can exceed the base cost of shipping!
Liftgate:
This is a service that assists the driver in loading or unloading his truck when a loading dock is not available. The Driver’s trailer is equipped with a hydraulic ramp that lowers to the ground. Lift Gate service is almost always billed on residential pickups or deliveries and in commercial pickup and deliveries where loading docks or forklifts are not available. Only a small percentage of the trucking company’s trailers are equipped with liftgates, so be sure to notify them of your need for one in advance.
Residential Pickup or Delivery:
Anytime a trucking company must pickup or deliver into a residential area a fee is charged. This is because in most cases the local laws restrict the size of delivery trucks causing the carrier to utilize a smaller truck to service a residential area. Smaller truck requirement equals less shipments per day picked up and delivered hence the fees are assessed to offset the carrier’s losses.
Appointment or Notify Pickup / Delivery:
By default, carriers make pickups and deliveries in order arranged by geographic location (a route). If your shipment requires the carrier to call ahead; or schedule an appointment, they usually charge an additional fee for this service.
Inside Pickup / Delivery:
By requiring the truck driver to pickup or deliver inside a building; his route takes longer to complete. The carrier will charge an additional fee for this service.
Cost Saving Hint:
Many carriers allow pickups from or deliveries to their terminals. By doing this, you remove any accessorial fees that would normally be charged for liftgate, residential pickup / delivery, inside pickup / delivery or appointments. Your provider will be able to provide you the address and phone number for the closest shipping terminal to the origin and destination.
Tips to Avoid Shipping Damage:
Unlike small parcel shipping via USPS, Fed EX, UPS and DHL; shipping freight yields a much higher likelihood of damage. The common misconception is that packaging is not required, or minimally required. Always ask the broker the packaging requirements for the type of freight you’re shipping. The trucking company that picks up the item may refuse to pickup if the packaging is not up to standard. They do this to avoid freight claims and the potential of damaging your item. Trucking companies don’t want items to get damaged, so packaging guidelines are in place to prevent damage whenever possible.
The #1 reason for denial of freight damage claims is IMPROPER PACKAGING.
If the carrier deems the packing of your item to be below standard, they have the legal right to deny your damage claim. They also have the law on their side, so don’t think your lawyer will be able to help you force them to pay a claim when you have not done what the courts feel is your job.
At a minimum your item should be secured to a wooden pallet. The pallet should be a minimum of 4″ larger than the item secured to it on all sides. Trucking companies load and unload their trucks with forklifts and pallet jacks. Sometimes a dock worker will try to slide the lift truck forks under and item not mounted on a pallet which causes damage in most cases. Should this cause damage, the carrier will yell improper packaging and accept no responsibility for the damage. When freight is loaded into a truck it will shift and move around slightly while going down the road. By using a pallet, should your item shift; the pallet will in most cases prevent or reduce damage.
Rarely do trucking company pickup at your door and go directly to the destination address. Instead, your shipment will go to a local warehouse or transfer facility where it will be unloaded from the pickup trailer, and sorted based on its final destination. Once sorted it is loaded onto another trailer along with other shipments heading the same direction. It is not uncommon for a shipment to ride on 5-10 different trailers prior to reaching the final destination. This is done to allow the trucking company to maximize the use of trailer space on each shipment, but at the same time greatly increases the opportunity for damage.
The best option is to have your item packaged in a wooden crate with a pallet used for a foundation. This provides the maximum protection you could ask for. The internet offers a wide range of crating and packaging services available to the general public. Think of these services as insurance policies. If you spend $750 or more on an item is it worth $100 or so in packaging costs to make sure it arrives undamaged?
Packaging Supplies:
Pallets can be found at most hardware and groceries stores free of charge (they often throw them away) Driving around the back of a furniture store will often yield Styrofoam and large boxes that can be used to protect your shipment. Pallets are usually constructed of oak or other hardwoods, so consider grabbing a few, popping the planks off and using this hardwood lumber to build a crate.
I hope you have found this guide useful and informative. If you need more information or have questions, please contact us.
