Freight is a term utilized to classify the conveyance of trade goods and is often a commercial process. Items are commonly formed into various shipment families before they are carried.
This is dependent on many factors:
- The type of item being transported, i.e. a kettle would usually be put into the listing 'household goods'.
- How large the shipment is, both in terms of item sizing and quantity.
- How long the item for sending will be in transit.
- Items are commonly branded as household goods, express, parcel, and freight Loadings.
Pieces of furniture, art pieces, or like Cargo are always separated as household goods.
Very small business or personal shipments like envelopes are counted as overnight express or express letter items. These shipments are seldom over a few pounds, and almost always travel in the carriers own packaging. Service degrees are varying, depending on the shippers choice. Express items just about always move some distance by air travel. An envelope will go coast to coast overnight or it could take numerous days, based on the service choices and prices paid.
Larger shipments like small boxes are counted as parcel or ground shipments. These payloads are rarely over 100 pounds, with no single piece of the payload weighing more than about 70 pounds. Shipments are always packaged, occasionally in the shippers packaging and sometimes in carrier-provided packaging. Service grades are again variable; but most ground cargos will move nearly 500-700 miles per day, going sea-coast to seashore in more or less four days depending on origin. Parcel consignments seldom travel by air, and normally move via road and rail. Parcels make up the absolute majority of business-to-consumer (B2C) loads.
Beyond HHG, express, and parcel consignments, movements are described as freight shipments.
Less-than-truckload (LTL) freight:
The first listing of freight shipment is less than truckload (LTL). LTL shipments are also often referred to as "motor freight". Air cargo or air freight shipments are very similar to LTL shipments in terms of size and packaging requirements.
Truckload (TL) freight:
In the United States of America goods heavier than about 15,000 pounds are ordinarily classified as truckload (TL) in that it is most economical to only use a truck rather than share it in an LTL environment.
Express, parcel, and LTL shipments are always intermingled with other shipments on a single piece of equipment and are typically reloaded across multiple pieces of equipment during their transport. Increasing shipment size has proven to be a significant opportunity for many companies - particularly large consumer product companies.
Schemes for increasing load size include: consolidating orders onto the truck using a Transportation management system. Here the "optimal combination of orders and stops can be used to fill out the truck. When shipping freightage, it is extremely important to read up on pricing, claims, and insurance.
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How freight pricing works:
LTL rates are quoted per 100 pounds or cwt or per hundred weight. Besides the discount off of base rate created by the freight class, there is typically a second discount applied to the calculated transportation rate. These discounts are negotiated by the shipper with individual LTL carriers. For example, a given LTL lane may have a rate of $50 cwt. If a shipment is 1,000 lbs at class 70, then the adjusted base rate is $35 cwt (70% of 50 cwt) or $350. If the hypothetical shipper had negotiated a 50% discount on published tarrif rates, this would give a final price of $175 for the shipment.
Truckload (TL) carriers usually charge a rate per mile. The rate varies depending on the distance, geographic location of the delivery, items being shipped, equipment type required, and service times required. TL shipments usually receive a variety of surcharges very similar to those described for LTL shipments above. In the TL market, there are thousands more small carriers than in the LTL market; so the use of transportation intermediaries or brokers is extremely common.
Cargo insurance:
Cargo insurance only covers significant loss or damage to the cargo only. Carriers insurance does not cover consequential damages like lost sales or downtime on a production line. Also, carrier insurance does not cover the cost of returning damaged cargo to the shipper. Again, cargo insurance is very low and very tightly defined; so shippers must package shipments extremely well and be sure to clarify the specific insurance that will apply to each shipment.
Freight packaging:
Unlike small parcel shipping via a delivery company like Federal Express or UPS, shipping freight has a much higher likelihood of damage. LTL companies pack lots of different types of freight onto lots of different trailers using forklifts and other heavy equipment, creating a harsh and dirty environment for freight. Other LTL shipments will be packed around and on top of a given customer's shipment; so all freight shipments should be packaged very carefully.
Freight shipping summary:
Railcars could send any bulk shipment to many locations. Shippers generally first ensure that they are employing the most effective type of carrier for their specific type of payload: using an LTL carrier for an LTL item, for example. While parcel carriers will accept LTL shipments, and LTL carriers will accept TL payloads, shippers will ordinarily see lower quality service at higher rates when carriers service shipments that is "non-standard" for their specific company.
once the shipper has chosen the correct type of carrier, the shipper then shops several carriers in order to find the most effective service and price for their object. Shippers seek out all-inclusive quotations that include all surcharges and accessorial fees.
when the shipper has chosen the mode and carrier and is ready to ship, they normally over-package their freight object and verify insurance coverage, to lessen the chance of damage & claims.
Inexperienced shippers oftentimes use the services of a freight intermediator or advisor to allow them locate the most appropriate carrier, service, and price for their dispatches.
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