In today’s complex logistics ecosystem, freight classification protects the interests of all supply chain stakeholders throughout the lifecycle of a shipment. Beyond determining packing requirements, it is vital for the safe, compliant and timely delivery of your shippers' cargo to the final destination. If this field is wrong on the bill of lading, your customer’s shipment will be put in jeopardy.
The classification system for transported materials may be standardized by the Nation Motor Freight Traffic Association (NMFTA) to ensure unbiased pricing, but that doesn’t mean it’s always input correctly. In fact, our quality assurance teams find that National Motor Freight Classification (NMFC) errors are one of the most common data discrepancies that carriers and 3PLs deal with.
Freight class is determined by the following four characteristics:
- Stowability - While most freight should be easy to stow in trucks, hazardous or flammable materials carry greater risk and have certain regulations for shipping. Consider the outside packaging and materials of your customers’ shipments. Did they properly assess the overall weight, length or protrusions associated to the item? For example, if their cargo is stored in crates that are easily stackable inside of a truck, ease of transfer is increased.
- Liability - Freight liability is determined by the probability of theft or damage of the item. Additionally, class is subject to liability if the commodity may cause damage to other customer cargo during the LTL shipping process. This lifts the overall risk- which results in a higher freight class. Density must also be considered when classification is based on liability.
- Handling - Ease of handling is the level of care needed for your shippers’ freight. Heavy, fragile or hazardous cargo will almost always be placed in a higher shipping class. Shape, size and weight will also affect how easily mechanical equipment can load shipments, which is why the overall difficulty of loading is assigned to each shipment.
- Density - Freight density is the weight or cubic feet of freight. When comparing the freight class, denser items fall into a lower class whereas bulky and heavy items are more expensive to ship.
The three steps that should use to measure density:
- Measure the height, width, and depth of your shipment
- Multiply the three values (height x width x depth)
- Finally, divide the weight (in pounds) of the shipment by the sum cubic feet
Some of the most common classes are; 60, 70, 85, 92.5, and 100. The lowest class, clean freight, is 50 and the highest is 500. The lower the class, typically the lower the price of shipping costs. Head’s up: Tranzact.com actually offers a free freight class calculator which does all the work for you.
If you are shipping items that vary in size such as; clothing, bed frames or couches, freight rate classification can be determined solely by overall density. These items fall into a certain category labeled Not Otherwise Indicated (NOI). The NMFC code is not enough to determine the class of certain shipments. Density takes on the superior role of class determinant.
Your shippers may choose a freight class not understanding the process.
Some shippers may think that they'll save money by picking a lower class, but issues almost always arise. Often, you and other carriers and 3PLs will have to reclass the shipment. The invoice may not match the shippers’ expected costs, but you'll mitigate a series of delays and headaches for both you and your customer.
Give advice to your shippers. For example:
- To lower their LTL class, they should review their palette configurations and maximize space.
- The more “open space” inside their packaging, the less dense your shipment will be. Denser shipments = lower class.
- Expert tip: Offer discounted rates for stackable freight or upcharge for non-stackable.
- They must also make sure that the shipment properly displays the coordinated NMFC code with the corresponding class.
These inaccuracies go beyond annoying billing disputes. They poke holes in your revenue stream that aren’t apparent until the cash flow has diminished significantly. DDC’s partners report record-high accuracy rates, recurring client retention and a standard 40 percent cost savings from error adjustments alone.
Questions or concerns? To speak with one of our billing experts now, submit a request here. We look forward to speaking with you.