Ask Your Question!

We understand the challenges and the issues of our industry, which is why we've created Ask the Experts — to give you a chance to voice your concerns and allow us to help you solve your problems. Whether it is getting control of transportation in multiple facilities or how to properly allocate freight costs, we'll do our best to address these topics and provide you with insight. Email experts@tranzactinside.com with your question.

Doug Kahl Q: My carrier representative tells me that my discounts have decreased because my rolling average has gone down. How does this impact my contract rates?

A: A key aspect of parcel agreements is the correlation between incentives and the average weekly revenue, also known as the rolling average. Before I explain what it is and how it works, let me pose a couple questions you should always know the answer to... Keep reading...

Chad Provencher Q: When does it make sense to look at a pool distribution opportunity, and what are the issues to consider?

A: For clarification, Pool Distribution is when a company consolidates its LTL loads into TL to be sent to regional facilities. While each company is unique and there are no set rules, in pool distribution planning it is always important to look at the annual LTL freight spend for shipments greater than 500 miles. When looking at a potential pool distribution program, you should consider Lanes, Volume, Pricing & Resources. Keep reading...

Doug Kahl Q: Last summer, our transportation budgets went out the window because of fuel surcharges. What do you think will happen with Ground and Air fuel surcharges for the rest of this year?

A: Keeping track of the fuel surcharge (FSC) is very important since it is typically the single most expensive, and certainly the most volatile, of the various accessorial charges. You should also note the two-month lag between the US Department of Energy's (DOE) posting of fuel costs to the carriers' application of the index number to apply their surcharge. Keep reading...

Vic Stajduhar Q: What should I, as a shipper, consider when developing and maintaining strong, sustainable carrier relationships?

A: A high level of integrity is essential to developing and maintaining relationships that will endure the test of time. Failure to gain and sustain trust will sour a relationship before it can even get off the ground. Keep reading...

Dana Regan Q: I want to reduce my transportation costs, so I took our freight out to bid with our current providers and achieved a 5% reduction in rates. Based on what I am reading and hearing in the marketplace, I was expecting savings of 10%-15%. Do you know how I can further reduce my rates and overall transportation costs?

A: At the most basic of levels, if you want to achieve savings in freight costs, you have two options: rate reductions and practice changes. Let's discuss direct rate reductions, the quicker and less drastic route to identifying additional savings potential. A couple questions first, when you performed your bid, did you: 1) Bid out all traffic in all modes? And, 2) Send the bid to new carriers or incumbents only? Keep reading...

Dave Bungum Q: How do we begin to leverage transportation spend activities across our whole enterprise when we are part of a decentralized profit center oriented business structure?

A: The initial step usually involves getting executive sponsorship and cooperation from the various business unit management groups. This often involves showing compelling data to answer the WIIFM (What's in it for me?) question for both potential savings and operational control at the business unit level. Keep reading...