Freight Quotes Explained: #1 Guide to Calculating Shipping Costs
In the world of logistics and supply chain, it’s important to understand shipping costs to help you keep more of your profits. Although this freight quotes guide is designed for new shippers, it can also help seasoned shippers save more money on each delivery. We’ll break down the key components to understand the role of freight quotes and how to calculate freight costs. Scroll down to learn how we simplify getting free freight quotes on our website to help you, the shipper, save both time and money. Let's get started!
Freight Quotation Terminology
Steps on how to get a freight quote start with understanding the terminology! Knowing these key terms will help you navigate the world of freight quotes costs like a pro - let's break them down:
Bill of lading (BOL):
Consider this your shipment's passport. It's a legal document that acts as both a receipt and a contract between you (the shipper) and the carrier (driver) or broker. It spells out the type, quantity, and destination of your goods. Crucial details like pallet count, case count, weight, addresses, and reference numbers find their home on the BOL. When the shipment arrives, the receiver uses the BOL to check if everything's in order or to note any discrepancies or damages. And remember, carriers won't get paid without that signed, received BOL!
Think of this as a categorization system for freight. Classes range from 50 to 500, with lower classes generally hinting at lower shipping costs. Factors like density, stow-ability, handling, and liability all play a role in determining a shipment's freight class. This is especially important for LTL quoting.
An all-inclusive rate that covers the basic transportation charges and fuel costs. But don't jump to conclusions: accessorial charges like detention (for delayed loading) might still apply. You can request both all-in rates and rates without fuel factored in.
This is the heart of your transportation cost. It’s all about moving freight from point A to point B. Distance and weight usually dictate these charges.
Free On Board (FOB):
Indicator for when ownership of the goods switches hands and is followed by a location. FOB Origin means the buyer takes responsibility at the seller's location, while FOB Destination means the transfer of responsibility happens upon delivery.
The extra services that can pop up. Think liftgate delivery, inside delivery, or storage fees. Some, like detention or layovers, can be tricky to predict beforehand. We'll cover these in more detail below.
A factor in freight class determination with regards to the space a shipment requires in relation to its weight. Calculated as Total Weight/Cubic Volume. High density often means a lower freight class and, subsequently, lower costs.
Freight of All Kinds (FAK):
A harmonious mingling of products. When your shipment contains a variety of freight classes, FAK might be used to simplify pricing.
Types of Freight Quotes
With the following freight quote guide, you’ll find that there are 4 main ways to ship your products via trucks. It all depends on what and how much you’re shipping. Additionally, it’ll come down to budgets and scheduling. For instance, if you need a product ASAP, you’d ship Full Truckload (FTL) over Less-Than-Truckload (LTL). Let's define these shipping options and what they mean for you:
Less Than Truckload (LTL), is a shipping method primarily used for business-to-business (B2B) shipments. The assigned freight class considers factors like size, weight, and density.
For sizable LTL shipments, comparing quotes with partial and Full Truckload (FTL) options is advisable. This category typically accommodates 1-8 pallets for products weighing between 150 lbs and 15,000lbs. Consumer goods like electronics, appliances, boxed or crated products, equipment, and other palletized items are suitable for LTL. However, certain items, such as highly valuable or fragile goods, may not be suitable for LTL due to the likelihood of the items being moved several times, which increases the risk of damaged goods. Mostly popular with small to medium sized businesses for its flexibility and cost-effectiveness.
Cota Systems aims to facilitate technology adoption in small trucking companies, offering free and easy-to-obtain LTL freight quotes for improved efficiency and reliability. We connect shippers with certified CotaCarriers for the best quote for shipping a wide range of products. We also have a reputation of damage-free shipments with a 99% success rate!
Partial load freight contains bulky, non-uniform cargo like equipment, machinery, and vehicles. Ranging from half a truck or more, it's suitable for items that aren't overly fragile or prone to disrupting other products. Typically made up of 8-18 pallets, these loads are light enough for a legal combination with another shipment. For the best freight rates and efficient solutions through streamlined logistics, rely on Cota Systems. We help facilitate partial shipments and vet all carriers on our platform.
For instance, if shipping 10 pallets of animal feed, a carrier can legally combine it with another 10 pallets of egg cartons, allowing both customers to split the trailer space cost.
Full Truckload (FTL)
Full Truckload (FTL) is a shipping mode where a dedicated truck transports one shipment exclusively, offering advantages over Less-Than-Truckload (LTL). This self-contained journey allows for flexibility, accommodating smaller amounts if one opts to pay the freight price for an entire trailer.
With a maximum of 42,500 lbs and 26 pallets, FTL is versatile for various cargo sizes. 10,000lbs of construction material can take up an entire 48-foot trailer, leaving no room for combination with any other shipment, hence the Full Truckload option.
With freight rates and benefits such as dedicated service and reliable transportation, reach out to Cota Systems. We make FTL shipments easy and reliable by vetting all carriers on our platform. We also offer simple freight management for reduced costs, streamlined transparent shipments, and never re-rate! Other brokers, freight forwarders, or carriers with brokerage divisions can help facilitate but tend not to offer the perks or assurances available through Cota Systems.
Spot Quotes Vs Contract Quotes
Spot quotes represent a one-time, market-rate estimate for urgent or irregular loads, allowing flexibility for immediate shipping needs. In contrast, contract quotes offer a priced arrangement for a set duration, often a month or quarter, providing stability and potentially lower costs.
If you have big projects that need shipments regularly, contract quotes make it easier to plan and guarantee the same rates for the entirety of the arrangement.
Spot Quotes: The broker gives a price based on what's happening in the market in real-time.
Contract Quotes: Set fixed prices for longer periods of time, considering things like where the shipment goes, the type of goods being shipped, and how often shipments are required.
Choosing expedited shipping puts your shipment in first priority, speeding up delivery compared to regular methods, though it costs more.
When is Expedited Freight Necessary?
It's crucial for urgent or high-priority shipments, like rushed manufacturing parts, perishable items, or essential equipment needed quickly.
When time is critical, getting expedited trucking freight quotes ensures fast transportation, meeting deadlines, and keeping time-sensitive materials on track.
The Easiest Way to Get A Freight Quote with Cota Systems
Calculating shipping costs is a breeze with Cota Systems. By connecting vetted carriers with shippers, Cota Systems empowers shippers to lower costs and offers a direct line to reliable carriers. Our platform focuses on efficiency - not just saving costs, but reshaping how logistics work. Check out our guaranteed freight quotes at Cota Systems. Enjoy a hassle-free experience with our free freight quotes and freight rate calculator. Here's how it works:
1. Choose the Type of Freight Quote You Need
It’s important to understand the difference between LTL and FTL for our freight shipping quotes.
In order to choose the type of quote you need, remember that Less-Than-Truckload (LTL) consolidates small shipments from various companies in one truck, while Full Truckload (FTL) dedicates an entire truck to a single large shipment.
How to Determine if Your Pallets Will Need LTL or FTL:
Pallet Count: LTL for 12 pallets or less; FTL for 12 pallets or more. If undecided (6-11 pallets), get quotes for both and compare.
Pallet Size and Weight: Standard size and weight favor LTL for cost-effectiveness.
Stackability: LTL is suitable if pallets can be safely stacked.
Perishability or Fragility: Assess if your product can withstand repeated handling in LTL shipments. FTL reduces the risk of damage to delicate items.
Time Sensitivity: FTL suits quick, scheduled deliveries.LTL tends to be slower.
Volume: FTL is cost-effective for large volume shipments that fill a significant portion of a truck.
Customized Requirements: FTL offers more customization for specialized transportation needs.
2. Enter the Ship Date
The ship date represents the day that the product leaves the supplier’s warehouse and marks the first step in the shipping process.
In the freight calculator, the ship date denotes when the product is packed, staged, and ready for pickup. This is a vital reference point that aligns with logistics operations to ensure that the goods will be dispatched in a timely manner from the supplier to the destination.
3. Add Pickup & Delivery Details
Enter the Zip Code to pinpoint pickup and delivery locations, aiding in pricing assessments based on regional factors like distance, tolls, and fuel costs.
Specify any special requirements for your freight quotes. This includes things such as loading docks or limited access, ensuring smooth logistics. If unsure, speak with your warehouse contact.
4. Specify Your Load and Trailer Requirements
Enter load details, including pallet dimensions, weight (including pallet weight), and the required trailer type (reefer for refrigerated goods, flatbeds for non-palletized or outdoor-friendly goods).
If uncertain, select "Not Sure," and we'll assist you in determining the optimal specifications.
Knowing the most accurate information will ensure precise trucking freight quotes. It also secures the appropriate transportation for your specific cargo needs.
5. Leave Your Contact Information
Provide us with your contact information and your free freight quotes will be emailed shortly.
Step-by-Step: How to Get a Freight Quote Without Cota Systems
Proceed with caution, as the process gets much longer and more drawn-out! At Cota Systems, we offer all of the below and beyond. We’ll provide you with free freight quotes and help you every step of the way with our freight shipping cost calculator. If you prefer the more laborious route, here’s what you need to know:
Make a List of Carriers
When looking for carriers, start by understanding your shipping needs. Will your shipment require a full truckload or will you be cutting costs by using Less-Than-truckload services? Understanding your shipment will allow you to better assist potential carriers in providing accurate quotes.
Here are a few things to keep in mind when conducting your research:
Service Coverage: Ensure the carrier covers the required route and destination of your shipment.
Pricing Structure: Ask them to break down their pricing and provide a final quote. Seeing this breakdown first hand will allow you to catch any unnecessary hidden fees or additional fees.
Transit Times: What's their quoted delivery time in comparison to other quotes? Will they require a layover or are they traveling more to reach the pickup destination than other carriers which could exasperate your fees?
Capacity & Equipment: Your full understanding of your shipment will come in handy here and avoid any unnecessary delays. Will the number of pallets fit in their truck? Make your requirements very clear.
Reputation: Does the carrier have a clear track record? Ensure that you verify their licensing with the Department of Transportation (DOT), confirm their insurance status with the Federal Motor Carrier Safety Administration (FMCSA), and search online for reviews about their company. Learn more about how to vet your carrier/broker here.
There are different ways to schedule a shipment. You can work directly with a carrier, use a broker or 3PL, or use an online freight exchange. No matter which route you take, always go through the above steps to ensure you don't fall victim to double-brokering.
Independent Carriers: These are people or businesses that own and drive their own trucks. They help you directly without the need of a 3rd party broker.
Freight Brokers: Freight brokers are like middlemen between shippers and carriers or drivers. They link businesses that need transportation with trustworthy truck carriers. A freight broker's job is to arrange transport for you, the shipper, and provide loads for the carrier to ship.
Third-Party Logistics Providers (3PLs): Third-party logistics providers are companies that broker, ship, store, and even pack freight for other businesses. They handle many parts of the supply chain which can also include supply chain strategy.
Online Freight Exchanges: Online freight exchanges are online platforms that connect shippers with transportation services - mainly for a Less-Than-truckload shipment. They work like brokers to find the right transportation options for businesses.
Collect Accurate Shipment Details
Making sure you measure and weigh your freight, including pallets and packaging, really well is super important. The exact size and weight determine what kind of equipment is needed to move your shipment. If the information is wrong, it might cost more because the equipment won't match what you're shipping.
Here are some tips for freight quotes:
Carefully measure and weigh your freight, and calculate the exact size and weight of your pallets.
If you can't weigh the final product, know that pallets typically weigh around 40 lbs.
Tell the carrier about any special needs, like overnight stops, special loading instructions, or if your items need special handling.
Additionally, with a quote for freight, say what kind of handling unit you have, like a crate, pallet, barrel, or something else.
Getting these details right helps everything go smoothly and avoids extra costs.
How to Calculate Shipping Costs:
Weigh Individual Items: Use a calibrated scale to make sure the scale is accurate and appropriate for the items in your shipment.
Measure Dimensions: Measure LxWxH for each item type. If items are irregular, measure the widest x tallest x longest points.
Calculate Total Weight: Add up all the individual items in your shipment.
Dimensional Weight: Some carriers will take volumetric into account for small, light, but bulky items instead of the actual weight. The Dimensional factor is up to the carrier and could depend on many factors including unit of measurement used, market demand, or industry standards.
Example of Dimensional Weight: Imagine a package that measures 24 inches (length) X 18 inches (width) X 12inches (height). The carrier's dimensional factor is 166 in this scenario.
To calculate Dimensional weight the carrier calculates the following: (24X18X12)/166 which equals to approximately 31.23 lbs.
If the actual weight of the shipment is less than 31.23lbs, the carrier will charge based on the dimensional weight calculated.
Packaging: Make sure you include the weight and size of your shipment’s pallets, boxes, and packing materials in your final calculations
Request, Compare, and Book
Armed with all the above information for a freight quotation, it's now time to reach out for the actual quotes. If you're using a load board or broker, you've likely already shared the above shipment details via forms. Get as detailed as possible to ensure you get the most accurate freight quotes! Wrap up your shipment plans with the chosen carrier. They'll guide you on the necessary details and provide a Bill of Lading (BOL).
Freight shipping quotes and booking loads with Cota Systems is easy and clear. We make communication simple and don’t leave no chances for re-rates to pop-up!
Negotiation Tactics to get the Best Freight Rates
For Less Than Truckload (LTL), there's not much room to negotiate freight pricing. For Full Truckload (FTL), watch out for seasonal rate changes. Negotiation tactics for freight shipping quotes rely heavily on knowledge. Being aware of the carrier's costs to ship your product will allow you to enhance negotiation tactics for better rates. Remember, these are steps we take on at Cota Systems on the shipper’s behalf - it's important to us that we provide the best rates for shipping without low-balling the carrier in the process. We understand the logistics and negotiate the best rate possible for both parties involved.
Now, let's jump into how you can take on this process:
Keep Up With the Spot Market
Understanding how spot rates affect trucking freight quotes is essential when it comes to transportation costs. Spot rates, the current market prices for shipping, determine your freight costs. Changes in seasons or busy times can cause spot rates to rise or fall, which impacts your quotes. If spot rates go down, you can use this information to request a lower rate.
There isn't a specific formula used to calculate spot rates but rather an inclusion of multiple different factors to consider. Let's break these down, starting with the basic rate calculation:
Base Rate Calculation:
Base Rate= (Mileage Rate×Distance) + Fuel Surcharge
Mileage Rate: $ per mile based on type of freight, truck type required, and market conditions.
Distance: Total from pickup to delivery.
Fuel Surcharge: Variable based on fuel price fluctuations
Freight Type: General Cargo.
Distance: 500 miles.
Mileage Rate: $2.00 per mile (This can vary based on freight type, truck type, and market conditions).
Fuel Surcharge: Assuming fuel surcharge is 10% of the mileage cost.
Calculate the Mileage Cost:
Mileage Cost = Mileage Rate × Distance
Mileage Cost = $2.00 × 500 miles = $1000
Calculate the Fuel Surcharge:
The fuel surcharge is often a percentage of the mileage cost. Assuming it's 10%:
Fuel Surcharge = 10% × Mileage Cost
Fuel Surcharge = 10% × $1000 = $100
Determine the Total Base Rate:
Total Base Rate = Mileage Cost + Fuel Surcharge
Total Base Rate = $1000 + $100 = $1100
After the above calculation for base rate, you'll also have to consider the following:
Are there any additional factors such as special handling or special equipment required to handle your cargo?
Will the shipment be expedited?
Is a layover required or will there be any unexpected detainment at pick-up or delivery? If so, an additional fee can be expected.
If demand is high, you could experience seasonal adjustments.
Have you adjusted your calculation based on the current market? Research current spot rates and industry trends before your shipment.
Is the carrier looking to charge you fees others aren't?
Are there any tolls or expected congestion on the route?
All of these points will allow for fluctuations in the freight quotes you receive. That's why it's so important to gather multiple quotes for comparison, we do the same here at Cota Systems on behalf of shippers - as you can tell, it can be a long process!
Leverage Other Quotes
When your preferred carrier gives a higher price than others in the freight rates you have, use it to your advantage. Tell them you have other offers at a lower rate and ask if they can match it for your partnership. This is a common practice and a smart way to save a bit on each shipment. Using a freight quote calculator makes it easier to compare and talk about prices, helping you save more money in the end.
Building Strong Partnerships
When negotiating freight pricing, building long-term partnerships is crucial for both parties to be successful. Here are some practical tips:
Reliable Business: Offer steady and reliable business for the carrier, this can increase your chances of getting better rates.
Fair Payments & Schedule: Ensure all invoices are paid on time and the price is fair for both parties.
Communicate Openly: Provide clear expectations and timely feedback.
Flexibility: Carriers aren't immune to setbacks. Understand that there are factors outside of their control such as weather delays. Your flexibility will go a long way.
These are just a few ways you can maintain long term relationships with carriers your business can rely on. Remember, win-win solutions are key, and if your carrier is satisfied, they're likely to express even greater care for your business goals.
Factors Impacting Freight Rates
FTL and LTL rates are different because they handle shipping in distinct ways, and there are unique costs for each. Various factors explain why FTL and LTL freight shipping quotes vary:
In shipping, heavier things cost more for Less Than Truckload (LTL). Small, dense stuff is cheaper, and big, light things cost more. For Full Truckload (FTL), heavy loads use a bit more gas, but it doesn't affect the price much, unlike the detailed considerations for LTL freight quotes pricing.
It's no surprise that the further the shipment travels, the more fuel is required. Fuel surcharges (FSC) will impact cost and can fluctuate depending on the price of fuel. For example, in early 2019, the cost of diesel fuel was $2.99 a gallon, versus the $4.41 a gallon in early 2023. With almost $1.50 increase, your price for the same shipment in 2023 would be significantly higher than in 2019.
Consider All-In rates when discussing shipping quotes which would factor in fuel surcharges, the basic rate we calculated above, cargo insurance, and more.
Density & Freight Class
For LTL, understanding density and freight class is super important to calculate shipping costs for an accurate quote. Provide details about your shipment and the LTL carrier will verify the freight class for you. For shipping, the freight class (ranging from 50 to 500) depends on factors like how heavy the shipment is per cubic foot. If it's denser, it gets a higher class. The common classes are 50 (low) to 500 (high), and they affect how much you pay for shipping.
To estimate shipping costs, providing precise load details to the carrier makes sure you get the right freight class and an exact quote.
The freight classes are categorized as follows:
Estimate shipping costs as freight rates can fluctuate with the seasons, affecting prices based on specific needs. For example, in Arizona's tomato season, rates go up because many companies need transportation. During other times, rates stay lower. Similarly, in Florida's produce season, reefer rates double or triple compared to the rest of the year. Knowing these seasonal changes helps shippers plan and budget better.
Meeting scheduling needs impacts how to calculate shipping costs. Be aware of weekend, holiday, and overnight charges, as tight schedules may limit available capacity, potentially leading to higher rates. Certain schedules may require team drivers. When requesting a quote, include scheduling details to avoid potential re-rates.
Breaking Down Common Fees and Surcharges
When calculating shipping costs, accessorials are additional services incurring extra charges. Examples include liftgate usage, inside delivery, and reweighing. Average costs vary, with liftgate fees around $75 and inside delivery at $50. Cota Systems includes all fees in the quoted freight price for clear and accurate pricing, but if you're looking at independent freight quotes here's what you can typically expect:
Fuel Surcharge (FSC):
An extra fee for each mile to cover fuel expenses. For example: A $2 per mile rate for 1,000 miles with a $0.25 per mile fuel surcharge (FSC) and a $50 tarping fee is: $2.00 X 1,000 miles X $0.25 FSC + $50 tarping = $2,300.
It's important to note that with contract rates, if gas prices change, the FSC amount will also change, impacting contract rates for freight shipping costs accordingly.
Detention charges are put in place when loading or unloading goes beyond the free 2-hour limit. Carriers may charge $50 for each extra hour. It's wise to ask about detention rates upfront to estimate shipping costs accurately. Layovers, due to delays causing an extra night on the trip, might cost $250 for vans and $350 for reefers if the fault lies with the shipper or receiver.
Reclassification in LTL happens when the carrier checks your freight during the journey and finds that the class listed on the bill of lading doesn't match the actual class. This can occur for different reasons, stressing the need for accurate weight and measurement details. To estimate shipping costs accurately, it’s important to provide correct information to prevent any reclassification surprises.
For LTL shipping, using a lift gate comes with an additional charge, especially if combined with restricted or residential delivery. In FTL shipping, a lift gate mainly limits the available truck options, with an additional cost ranging from $100 to $300. Knowing about lift gate fees is important when getting trucking freight quotes to prevent surprises in your costs. A lift gate is typically required when the shipment is too bulky and/or heavy for manual loading and unloading, or if the pickup or delivery location doesn't have a loading dock.
For a quicker freight shipment, expedited and guaranteed delivery options are available, but they come with added costs. Choosing expedited, as explained above, means your shipment gets there faster. Guaranteed delivery ensures it arrives by a set date. Checking LTL carrier websites can give examples, but figuring out the exact increase is tricky. FTL is usually less affected since you often have set pickup/delivery times, but LTL costs can go up a lot for these quick services. When asking for a freight quotation, keep these options in mind and think about how they might affect your budget.
Cota Systems: Save Money and Ship With Confidence
When shipping goods, costs depend on factors like distance, weight, and special services. Using online freight services simplifies things, offering instant quotes, clear rates, and easy cost-effective shipping. If you’re wondering how to get a freight quote, save time and money with Cota Systems’ free freight quotes.
Here's how we help shippers get the best rates and most reliable deliveries with our FreightPro™ system. With Cota Systems, you eliminate the risk of re-rates and always pay only what you're quoted. We help shippers reduce costs with Freight All Kinds (F.A.K) shipments that are direct, consolidated, and negotiated for competitive rates. Start with a free freight quote and start keeping more of your profits!
I joined Cota Systems to help U.S. truckers grow their businesses. I proudly served in the U.S. Navy, managed some of the largest brands on earth, and I'm excited to share what I've learned with you. Truckers are the backbone of our great nation and when you and your family are thriving, so is America! 🇺🇸