Moving freight starts with determining what the fair rate for your shipment is. Obviously, carriers and shippers want to make sure they are getting or paying a decent price for a load. Carriers don’t want to lose money, and customers don’t want to pay more than they should.
Before moving a load, it is important to research the market and determine what the fair rate for your load is. There are a lot of variables that go into determining rate, and it’s important to consider all of them when calculating your target rate.
1. Equipment Type
It’s crucial to keep in mind which equipment you need to move your load. Flatbed and van rates may vary drastically on the exact same lane. If your load is anything out of the ordinary (over-sized loads requiring special equipment), be sure to consider that when calculating the rate as well.
Rates follow a similar pattern every year, and seasonality plays a huge role in determining rates. You will have to pay much more for a load in the peak season in the summer compared to February.
Monitor fuel prices and be aware of any spikes and drops. Changes in fuel prices directly and almost immediately affect rates across the country. Having some insight will help you be fair as well as ensure you are not being taken advantage of.
It’s number 4 on our list, but could very well be number 1. This is the basic factor that determines how much you will have to pay for a load. Certain places may be a tough destination to ship to, causing the rates to be much higher. At the same time, moving a load out of that location will be cheaper. Before determining a rate, always research load to truck ratio at your origin and destination points.
Once you’ve done all your research and finally have a target rate in mind, there’s one more thing to consider. When it comes to actually moving your load, you should evaluate how critical the load is. If you are more or less flexible with pick-up and delivery, you may be able to move it at the market rate. If the load has to go immediately, you may have to work the “premium” into your rate to send it out.
There are many different situations that can cause rates to fluctuate such as hurricanes, new regulations and more. Keep an eye on the news and industry trends to stay on top of the market conditions and navigate through rate fluctuations successfully.