Freight Class can be complicated and confusing for new shippers working with an LTL. Freight Class, as defined by the National Motor Freight Traffic Association (NMFTA), is a way “to establish a commodity’s transportability”. In other words, it’s a classification system built to provide a standard of pricing of carrier services.
The NMFTA established a set of standard classifications known as the National Motor Freight Classification (NMFC). For decades, class pricing based on the NMFC has influenced the LTL (less-than-truckload) world, but recent changes in favor of simpler profile pricing may have a big impact on the relationship between LTL carriers and their clients.
Class Pricing
Classifications are grouped into 18 general classes, ranging from 50 to 500. Each commodity is assigned an NMFC code based on its classification. The lower the classification, the lower the price of shipping. The NMFC is based on four basic commodity characteristics: Density, Stowability, Handling, and Liability.
This seems simple enough. However, figuring out which class the commodity falls into can become a complicated and cumbersome process, especially when the LTL carrier determines the quote for a client.
The wide range of shipped commodities makes the process of classification difficult, making much of the classification process seem subjective. As a result, deciding pricing can lead to disparity between what was quoted by a carrier and what is later invoiced to the client. This disparity can negatively affect the relationship between LTL carriers and their clients. As discussed in an interview with Scooter Sayers, president of Sayers Logistics, the NMFTA under new leadership has sought to simplify the classification process in order improve this relationship.
New NMFTA classifications bundle individual item classifications into larger, more general classifications that are easier to identify. The new focus of these classifications is directed toward the density of items, signaling a shift in the future of LTL shipments.
Profile Pricing
For freight that must be handled with care handling, stowability, and liability are a greater influence on the pricing, but for most freight, carrier prices are determined by density. As one can imagine, density has a dramatic influence on both handling and stowability. For this reason, there has been a move toward profile pricing that emphasizes the dimensions and weight of commodities over classification.
Focusing on the dimensions and weight of the commodities makes the process less subjective. This in turn makes it easier for carriers to provide more accurate quotes for their clients. If the dimensions and weight of the commodity matches that of the quote, the invoice will reflect the quote amount. Improved quotes provide greater confidence in the client relationship by making pricing less complicated and more predictable.
Profile pricing also allows for pallet-based pricing for mixed commodities. Rather than figuring out the class and price for each individual commodity on a pallet, shippers and carriers need only find the dimensions and weight of the pallet itself, leading to greater efficiency in processing commodities and determining carrier logistics.
The Future of LTL
With the move toward profile pricing focused on pallet rather than individual commodities, a need has opened for dimensioning and weighing tools capable of handling pallets. To provide the necessary data to the carrier, it is important that you have the most accurate dimensioning and weighing tools available.
Cubiscan is leading the way in supplying the best quality pallet dimensioning and weighing tools in the industry. The new Cubiscan S9 provides a unique solution for shippers by integrating weighing and dimensioning with stretch wrapping. By using the S9’s dimensioning capability, shippers can eliminate surprise invoices and get the best rates available.
If you are interested in seeing how the Cubiscan S9 can help your operation, click the button below or send an email to [email protected].
About Cubiscan
For over 30 years, Cubiscan has led the automated dimensioning industry. In the 1980s, it became clear that accurate dimensions and weight were essential for warehousing, distribution, right-size packaging, and freight-manifesting applications. By the mid-1990s, the company had established itself as an innovative supplier of static and in-motion dimensioning systems. Today, Cubiscan continues to innovate and guide its customers to effective material handling solutions by offering the broadest range of dimension-scanning technology available.
Cubiscan Media Contact: Aaron Taylor, Marketing Manager – [email protected]