Lowering Transportation Costs With a Freight Broker

Lowering overheads for transportation and warehousing is a key goal for many organizations. A strategic approach to ensure success is to leverage a trustworthy freight broker. These professionals can offer expertise and industry connections to streamline your logistics, negotiate competitive rates, and optimize delivery routes to reduce transportation expenses.

Increase your understanding of this multifaceted service by understanding how to partner with a freight broker who can share valuable knowledge and diverse strategies to optimize your supply chain in the long run.

What Is a Freight Brokerage?

Freight brokers facilitate transportation between organizations and carriers. A freight broker has an extensive network of contacts, specifically licensed, dependable, and insured carriers. Freight brokers are keenly aware of trends, capacities, special requirements for specific materials, and various rates.

Various unplanned risks can cause shipment delays, from changes in customer orders to vehicle breakdowns. A nimble freight broker can offer quick, creative solutions to minimize issues, helping ensure shipments are delivered on time as much as possible and saving you costs as a result.

How Does a Freight Brokerage Work?

When you partner with a freight brokerage, the process will happen as follows:

• Needs assessment: The freight broker will analyze details about your shipments, like the type of cargo, weight, size, locations, and delivery timeline. They use this information to source suitable carriers and quotations before negotiating acceptable rates and terms on your behalf. 
• Coordination and tracking: Your broker will oversee the logistics and manage transparent communications between you and the carrier to facilitate a smooth process.
• Solutions: If any issues arise that delay your shipment, damage the cargo, or cause transit concerns, the broker will liaise to resolve the problem swiftly.
• Feedback and finalization: Following successful delivery, your broker collects feedback, assesses your overall satisfaction with the service, and manages the paperwork. This paperwork can include the rate confirmation, proof of delivery, bill of lading, driver work receipts, and lumper receipts.

How Shippers Calculate Freight Costs 

Several factors impact freight brokerage transportation costs. While many are consistent determinants, freight brokers have invaluable insight they use to optimize costs and mitigate risks that may come with shipping.

• Mileage: Travel distance influences costs, as longer distances may require more fuel and additional charges on overnight transportation services.
• Size and weight: Large and heavy shipments use more space on freight vehicles, with higher fuel consumption due to added weight.
• Shipping class: The shipping class will influence the price of the freight services. Freight classification depends on the type of commodity you’re shipping, the ease of handling, liability, and density.
• Fuel prices: Fuel price fluctuations impact carriers’ operational costs, which impact transportation costs.

Solutions for Common Transportation Challenges

Freight shipping demands attention to detail — even minor mistakes or delays can turn into significant problems that create costly issues. Outsourcing your logistics lets you focus on core operations. Brokers have the experience and insight to offer scalable solutions to common and unique challenges in transportation.

• Shipment tracking: Your freight broker can provide real-time monitoring and visibility into the shipping process with tracking technology and logistics enhancement.
• Invoice audits: In cases where invoices are incorrect, your broker will audit these documents and ensure shippers make the necessary changes or updates.
• Claims and disputes: Should your inventory get damaged or go missing, the broker manages high-stakes tasks like resolving disputes and effectively managing claims.
• Contract negotiation: Your broker negotiates transportation costs on your behalf without sacrificing the opportunity of working with a reputable carrier.
• Logistics consultation: The broker can offer you expert advice on cost-saving measures in transportation and supply chain improvements.

How Freight Brokers Lower Transportation Costs

There are a variety of ways freight brokers lower your organization’s transportation costs. The benefits start with negotiating competitive rates with various carriers through their network and extend beyond that to provide comprehensive benefits for your team:

• Consolidating shipments: They can combine multiple client shipments to offer a consolidated solution if your inventory can’t comply. Creating full truckloads and optimizing space within these vehicles will lower the cost per unit.
• Load matching: Brokers match your shipping needs with carrier capacity to avoid underutilization and overpayment for freight services.
• Route optimization: By maximizing their expertise and technology, brokers can help plan more efficient routes to shorten transit times and minimize fuel consumption through mileage, reducing overall transportation overheads.
• Data-driven decision-making: Using technology to monitor shipments, brokers can identify opportunities to reduce costs, improve freight processes, and optimize logistic operations for your organization.

More Ways to Lower Transportation Costs

In addition to negotiating shipping prices, mitigating risks, and ensuring pricing continuity, freight brokers may advise you to lower shipping costs in the following ways:

• Off-peak shipments: Ship on off-peak days like Mondays and Fridays, which are typically low-volume days for carriers.
• Cross-docking: By shipping out inventory as quickly as possible using a cross-docking method, you can cut down on warehousing costs.
• Consolidate shipments: Scale and reduce per-unit transport expenses by combining multiple shipments into one load.
• Reduce dunnage: Use more efficient packaging methods, like using the correct box size for items or reducing dunnage, to maximize space utilization. Strategies like reducing dunnage can lower the number of shipments you need to send out while minimizing wasted space.

Partner With Keller Logistics Group for Lower Transportation Costs

Freight brokers offer neutrality, scalability, and expertise in arranging and managing your inventory’s transportation to lower costs and increase efficiency in your supply chain. The key to a successful freight broker partnership lies in transparency. Additionally, the ideal broker uses fleet management software and modern tracking technology to give you peace of mind and facilitate open communication. 

Keller Freight Solutions acts as a freight broker between shippers and carriers. Our team of professionals is ready to streamline your shipments between warehouses and manufacturers. Whatever freight you need to ship, our network of carrier partners is prepared to help. Contact us today to learn more about our 3PL services or request a free, no-obligation quote for your freight brokerage needs.