1. Public Education Partnership Seminar September 1, 2015
Freight 101
Public Education Partnership Seminar
September 1, 2015

2. Freight 101- Talking Points
Freight Management
Types of Transportation
Shipping Glossary
Rates
Terms from a purchasing perspective
Claims
Selecting a Carrier

3. Freight Management Ability to analyze True Cost
Definition
Importance
To handle or direct with a degree of skill, to exercise executive, administrative and supervisory direction of the loading and transporting of goods that need to be shipped or transported from one destination to another resulting in compensation.
Ability to analyze True Cost
Effective management can mean BIG savings

4. Types of Transportation
Parcel: Small package, Good transit times, multiple levels of service standards.
Air Freight: Shipments less than 2,000 lbs, fastest transit available. Premium rates.
Intermodal: Containers moved via rail, ship or truck

5. Types of Transportation TL: Truckload
Large loads
picks up in one location and delivers to the final location.
No additional labor requirements to support what the driver is doing.
Economical way to move large amounts of freight
Good transit time

6. Types or Transportation LTL: Less than Truckload
Smaller Shipment (less than 10,000 lbs)
Consolidate Single Pick ups to destination
Additional services available
Competitive Transit Times including overnight service

7. Shipping Glossary Bill of Lading (BOL)
A binding contract that serves two main purposes. 1: a receipt for the goods delivered to the transportation provider for shipment. 2. a definition or description of the goods and services required

8. Shipping Glossary Deliver Receipt (DR) COD (Collect on Delivery).
Document a consignee or its agent dates and signs at delivery, stating the condition of the goods at delivery.
COD (Collect on Delivery).
A shipment for which the transportation provider is responsible for collecting the sale price of the goods shipped before delivery

9. Shipping Glossary
Common Carrier: Company that provides transportation services to the public in return for compensation
Contract Carrier: Company that provides a dedicated fleet to a customer in return for a contractual rate.
Tariff: A document setting forth applicable rules, rates and charges to move goods
NMFC: National Motor Freight Classification

10. Shipping Glossary Trailers: Pup (28’), 40’, 45’, 48’, 53’
Combinations of the above
Dolly/ Convertor Gear: Provides and extra axle used to connect multiple trailers
Hazardous Materials: Defined by the US DOT as being a substance that if transported poses an unreasonable risk to the health and safety of property.
Pro: Number used by carrier for tracking shipment

11. Info needed for accurate quote
Rates Truckload (TL)
Truckload
Info needed for accurate quote
Rates are determined using a per mileage rate.
Rates can vary based on capacity in a certain lane
Origin zip code
Destination zip code
Special services.
Refrigerated
Delay time

12. Rates LTL: Less than truckload
Info needed for accurate quote
Rates are based on factors including weight, density, classification of freight, distance, base rates, freight all kinds, minimums, tariff, discount, accessorial/surcharges
Origin and Destination zip codes
Class
Accurate weight
Additional services required
Oversized or capacity

13. Rates Accessorial Charges
Fuel Surcharge: Every carrier has their own fuel chart that will show a fluctuating rate based on the national average supplied by the DOE. This amount is added to the freight charge only portion of the bill
Liftgate, Inside, Non-Commercial Delivery: With increased time, liability or special equipment needs at an all time high, Shippers must protect themselves by knowing the needs of their customers.

14. Freight Terms What does F.O.B. mean?
Free on Board refers to when the title of the shipment transfers from buyer to seller.
F.O.B Origin: means that the title to the merchandise passes at the time of pick up
F.O.B. Destination: means that the title of the merchandise passes at time and place of delivery

15. Importance of Freight Terms
Terms must be stated at the time of purchase as either FOB Origin or FOB Destination. Additionally the method of payment for freight charges should be designated as Collect, Prepaid and added or Prepaid and allowed.
These two items clarify the following:
Determines who claims freight loss or damage
Determines when the buyer accounts for the assets. (applicable tax)
Determines who pays freight

16. Freight Terms Importance of analysis
Request a bid from vendors including the price of goods based on both F.O.B. Origin/ freight collect and F.O.B. Destination/ freight prepaid and allowed
The difference between prices is the vendors freight allowance
Compare with state freight rates
Proper analysis ensures the bid is awarded utilizing the optimal carrier rates with no change in transit times or service

17. Claims
Shipper, Consignee, or third party who has the title to the goods may file a claim
Claim should be filed within 9 months of the date delivered and should include a copy of the original invoice, inspection report, BOL or DR as well as any supporting material. Ie. photos, description, exact notation of damage or loss
Goods must be retained along with all packaging material.

18. Freight Savings Additional tariff options. Proper packaging
Volume Rate: large loads, shipper load/consignee unload, pay for linear ft. used of a trailer
Pallet Rate: 48*40 pallet, flat rate, works well with heavy pallet shipments
Backhaul lanes
Draw backs; Alternative/ Reduced liability; Transit limitations
Proper packaging
Claims are time consuming and costly. Work with your carrier for advice on proper packaging that will reduce damage.

19. Selecting a carrier
Consider the factors necessary to make a good decision.
Transit time: direct service, guaranteed delivery
Service/ History
Rates
Relationship: Freight is a service based trade. It is important to get familiar with your freight vendors. Establish a good relationship that allows your carrier to provide input and search for a win/win solution.