4 Ways Companies Can Estimate Freight Charges In Advance

Written by Paul Forand

accurate-Freight-ChargesDo you have all the systems you need to provide accurate freight quotes?   

For years, it was standard to do very rough estimates of freight charges and absorb the extra costs, but today, that's not good enough.  Shipping is now one of the most costly areas of every business, and a company can't afford to make mistakes that could result in thousands of dollars in extra charges.

This is true for your customers as well as your own business.  If you cannot provide your customers with accurate up-front freight quotes, and this leads to higher charges later on, this could cost them money.  When these customers make the choice to begin optimizing their own shipping processes, you can be sure they will opt for another supplier who they can trust to be accurate. Being able to create truly accurate up-front freight quotes is quickly becoming very important for today’s businesses.  An educated guess could cost both you and/or your customer a lot of unnecessary expense.

Four Ways To Update Your Freight Quote System

1.  Regional Grid Estimates

Some smaller companies, who can't afford a significant investment, can improve their service by integrating regional grid estimates.  By doing a bit of research into local state-to-state shipping prices and freight schedules, it's possible to create a better-than-average estimate.

The problem is, this is still highly inaccurate, and it leaves no way of updating processes as freight regulations/fees change.  If a product you ship is subject to a fee you were not aware of, you could be in for a costly surprise.

2. Transportation Management Systems

A TMS is one of the most common options, especially among larger businesses.  A TMS creates a single database of every product you ship (including packaging materials), along with its weights and measures and a constantly updated chart of related handling fees.

The most common TMS systems include rating engines or even bid boards to provide the shipping costs up-front.  The downside is simply that they're expensive to implement: you will likely be on the hook for buying the software, the databases, and the hardware to run them.

3. Integrated Web TechnologiesEstimate-Freight-Charges

This is a wide-open field, which is hard to generalize.  With a programmer on your side, it's possible to integrate your website into either a TMS or an outside system which provides freight quotes directly to online users.  Such a system can be used by your own agents, or as a DIY solution for your online customers. 

Some carriers offer their own plug-ins for easy access, so if your preferred carrier has one, you're in luck.  It should be easy to work into your existing website.  If not, this would likely be a very expensive option.

4.  Stand-Alone Rating Applications 

Finally, there exists a small niche for software packages that are specifically designed to perform lookups of current shipping rates.  These are usually cheap and easy to implement on an existing web portal, however, they also usually have relatively high licensing costs.

That said, this is still one of the better options for a smaller business that needs to offer quality shipping services.

Or, Consider A 3PL

A quality third-party logistics firm can provide all the software you need, along with the expertise needed to utilize it.  From payment systems integration to end-user shipment tracking, a 3PL can make it happen at a far lower cost than doing it yourself.

Contact ReTrans Freight today for a free cost-savings estimate

photo credit: ogimogi via photopin cc

photo credit: Martin Gommel via photopin cc