“But we always shipped it at this class…”
A good chunk of our logistics service professional’s day is spent properly classifying product and sending the BOL (Bill of Lading) filled out properly with the right NMFC #. Sometimes we will run into situations where a new vendor will give us pushback on the freight class assigned to the product even when the product is a lower freight class than what they initially told us.
But why is that?
Here are the three most common scenarios we run into.
The first one is pretty simple, the freight class changed in the NMFC (National Motor Freight Classification). The freight class of an item is not fixed indefinitely and change periodically.
Sometimes items get broken out that were classified with other items for examples Potty Chairs (That is children’s seat and commode combined) is now Class 200 and has its own NMFC # 161361 which is now broken out from Potty Seats or Training Seats (No Commode) which moves at Class 175. For someone who ships both Items this distinction is very important as it will ultimately affect their freight cost.
Sometimes Items change from one freight class to another and aren’t just broken out from a different item or moved toward a density based freight class. One example is footwear which now moves as class 150 but for the longest time this moved under class 100. This had a direct impact on the footwear industry when this change started back in 2009-2010 in fact here is a link from the AAFA (American Apparel & Footwear Association) that opposed the change https://www.wewear.org/assets/1/7/060210nmftaapparel.pdf
As evidenced in the letter (linked above) one of the main reasons why footwear changed class from 100 to 150 in the NMFC, was because on average it had a density more consistent with Class 150 than class 100. The current trend of freight classification is moving more and more toward density based classification. In fact, some carriers have done away with using the NMFC and utilize density only to determine class. Some carriers give their customers options if they want to switch to dimensional or density based pricing. If you are unsure of what is the best for your business give us a call or shoot us an email (Listed Below).
The second scenario which is fairly common is the shipper may have always misclassified the product but now the LTL carriers have ramped up their efforts to weigh and inspect freight. Technology also plays a huge role in this effort. The LTL Carriers now have technology in place that pulls the dimensions from overhead cameras, while the product is also weight and the system automatically generates the density per cubic foot. Many of the major carriers have 40+ of these machines at various terminals. 10 years ago this technology didn’t exist. It was not common place to have over 90% of freight inspected and weighed 10 years ago. Now for freight to be inspected or reweighed is the standard with many carriers inspecting 90%+. The inspection rates go up even more if the no NMFC number is listed, or an outdated NMFC # is on the BOL.
The third scenario we run into is that the person who books the LTL shipments whether prepaid, collect or Third Party never sees the invoice that comes from the carrier. If I am the shipper and shipping out freight collect, if I am wrong on the class I would have no idea. The freight bill would go to the consignee. If the consignee didn’t perform a preaudit as PNGLC does, they would have no idea of any shipper’s error in classifying the product.
Likewise, if there are multiple departments or locations there may not be a connection between the shipping department/locations and the accounting department/HQ. In fact, we often see the accounting department/HQ is the only one that gets the freight bill. PNGLC’s system and process is built so freight can be seen across all departments and the information is readily available from the top down.
Rather than let any oversight fly under the radar like a possible reweigh or reclass PNGLC preaudits every shipment and properly classifies freight. We have at our disposal the periodical updates of the NMFC and move freight at the proper class upfront so there are no surprises down the road.
Over the past decade one of the biggest areas of change for LTL shipping is proper classification of freight. We see this trend to continue as technology improves and more shipments will fall under a density based model.
If you have any questions on freight classification or any changes that affect your specific products give us a call at 717-626-1107×3 or email firstname.lastname@example.org