The Hidden Costs of Choosing the Lowest Cost LTL Carrier

In the competitive landscape of logistics, selecting the lowest cost LTL (Less-Than-Truckload) carrier might seem like a prudent financial decision at first glance.

However, this choice can often lead to unforeseen expenses and complications, ultimately making it a more expensive option in the long run. Here are several factors to consider before opting for the cheapest carrier:

Unsuitability for the Job

The lowest cost carrier may not always be the right fit for the job. Different carriers have varying specialties and capabilities. Opting for the cheapest option without considering factors such as transit time, handling requirements, and service quality can result in delays, damages, or other issues.

Avoidable or Unexpected Accessorials

Choosing a carrier solely based on cost may lead to the incurrence of avoidable accessorials. These additional charges, such as detention fees, re-delivery charges, and liftgate fees, can arise if the carrier lacks the necessary equipment or fails to adhere to specific delivery requirements. A reliable LTL partner leverages their experience and expertise to ask pertinent questions about each shipment, identifying the need for additional services such as lift gates or inside delivery. By addressing these details in advance, you can anticipate and budget for any extra costs, avoiding unexpected charges on your invoice.

Retailer or Grocer Preferred Carriers

In many industries, such as retail and grocery, certain carriers are designated as preferred partners. These preferred carriers have established relationships and streamlined processes with retailers, ensuring smoother deliveries and potentially avoiding penalties associated with non-compliance.

On-Time-In-Full (OTIF) Performance

The on-time delivery performance of a carrier is critical for maintaining customer satisfaction and avoiding penalties from retailers. While a low-cost carrier may offer attractive rates, they may also have a poor track record of meeting must-arrive-by-dates (MABDs), resulting in financial penalties or even the loss of business opportunities.