3 Ways To Avoid LTL Freight Classification ErrorsWritten by Neal Willis
Freight classification can be complex and it is getting more complicated all the time. Unfortunately, the freight class of an item is not fixed indefinitely. Each year brings additional changes in freight classification that will likely affect LTL shipping costs.
Educate Yourself on Freight Classes
Just because a freight class has been used in the past is no excuse for continuing to use it going forward. Keep in mind that carriers have the right to inspect your freight, so incorrectly classified shipments can result in higher than expected shipping charges. Disputing a carrier’s reclassification is difficult and time consuming, and you could be charged the difference (usually without a discount) if the dispute is unsuccessful.
Carriers also have the right to re-weigh a shipment if they suspect the weight noted on the bill of lading is incorrect. Inspection rates are also higher for shipments where an outdated NMFC number or no NMFC number at all is used on a bill of lading.
Commodities are grouped into one of 18 LTL freight classes established by the NMFC (National Motor Freight Classification) which range from Class 50 to Class 500. Generally, the lower the NMFC class number, the lower the freight charge. The NMFC is the standard for freight identification and classification. The NMFC does not set prices or specify rates. Your shipment’s freight class determines what the carrier will charge to transport it.
The freight class of your shipment is determined by four major factors: density, stowability, handling requirements, and liability exposure. Noting the proper freight classification on your bill of lading will enable a carrier to offer you the best possible service and the most accurate rates.
Utilize Technology & Industry Resources
Other than a TMS, the most truly accurate method for a shipper to ensure the correct freight class is to utilize The National Motor Freight Classification. You can purchase their publication of NMFC classifications (2017 price is $310.00 for non-participant members) or search NMFC classifications on-line. You can also keep yourself advised of recent changes to commodity classifications by using the NMFC website. The NMFTA also offers a variety of training programs to provide NMFC users with the skills necessary to accurately locate commodity descriptions and determine the applicable class and packaging requirements for products. This process sounds easy, but it can be difficult for the untrained eye, especially as product classifications and packaging requirements continually change.
With accurate NMFC information, a proper TMS can substantially improve shipping processes by providing consistent and full visibility of shipment information across your entire operation. Sales, Shipping, Customer Service and Accounting Departments can all benefit from a TMS, as it helps ensure that every user has access to the same information by consolidating all freight data into one centralized database. Having correct NMFC information listed in the TMS, however, is vital for it to be of any benefit.
Partner with a 3PL Provider
A dependable, proven 3PL can provide you with a customized approach to freight management with the added benefits of carrier and freight rate stability, full transparency of shipping and carrier information, tracking capabilities, and improved cross-departmental efficiencies, which will lead to happier customers and increased sales. Plus, a 3PL will take the time to look over your product catalog and bill of lading to verify you are using the correct freight class.
With access to the most current NMFC information and years of industry experience, today’s third-party logistics firms have the systems in place to take the complication out of the freight process and give you a competitive advantage. When you partner with a 3PL, you gain an entire staff of logistics professionals who work as an extension of your company without adding additional payroll expense, and you’ll have more time to focus on your core business.