We live in a world where we’ve become accustomed to free or cheap shipping: free two-day shipping on that new laptop that you bought from Amazon Prime, or a flat $5.99 shipping on that silver charm bracelet that you got your wife for mother’s day. Those items ship via small package carriers like the US Postal Service, UPS Ground, or FedEx. They’re limited in size, weighing only a couple of pounds on average, and arrive at your front door in days.
Not all goods are as easy, or as cheap, to ship, however. Take restaurant furniture, for example. It’s big, bulky, heavy, and often ordered in multiple pieces (think 40 chairs, 10 bar stools, and 10 tables). For that reason, furniture is put on pallets and ships via a different method called less-than-truckload (LTL) carrier.
LTL carriers take large palletized
There are many factors that determine the cost of shipping restaurant furniture via LTL carrier, some are obvious, and others, while not immediately apparent, make sense when you think about them. Here is a short list of the most important variables in the shipping calculation, along with a brief explanation.
Distance Between Shipper & Customer
The distance between the shipper and the customer (receiver) is one of the more obvious factors in the cost of shipping; we naturally expect that shipping from Boston to California will be more expensive than, say, shipping from Pennsylvania to Ohio. More distance means higher fuel costs and more driver time (wages). In addition, long trips often require a team of drivers that can alternate driving time in order to get the shipment to its destination in a timely manner.
Location
Shippers have what are called “good lanes” and “bad lanes”. A good lane is one that sees a lot of daily freight traffic, so the carrier knows that if they send a truck to that location, the odds are good that they will be able to fill the truck on the return trip. A bad lane is one in which there isn’t a lot of freight coming out, which means that the carrier may have to return empty, or only partially full. If a carrier can’t fill the truck, then they are making less money, or even losing money, on that trip. If a lane is bad for a carrier, then they will often charge more per piece to compensate themselves for the fact that they may not be able to fill the truck on the return. One prime example of a “bad lane” is Florida. There is a lot of freight going in to Florida, but not much coming out (for various reasons), so carriers will often charge a premium to deliver there.
Destination Type (Residential, Commercial, or Limited Access)
Customers often ask why it costs more to send a shipment to their home than it does to send the same shipment to their business. There are actually many reasons, but we’ll just list a few. First, businesses tend to be located in areas where large trucks can easily get in and out (if not, then they’re called limited access locations and are subject to the same fees as residential locations). Residential streets, on the other hand, are often too narrow for large semis to maneuver, so carriers have to send in a smaller truck, which means more handling of your freight. Second, businesses generally have somebody (or multiple people) and equipment on hand during business hours to unload the truck quickly and efficiently. Carriers know that they can just show up, open their doors, and the employees of the business will take care of the rest. With residential delivery, carriers have to call ahead to coordinate delivery, work around the homeowner’s schedule, and wait there until they unload the truck – often by hand.
Size of the Shipment
To simplify this point, let’s say you’re an LTL carrier that delivers from New York City to Orlando, FL. You know that to cover your costs and make a profit, you need to charge $3000 per truck for the trip. Now, a customer comes along and wants to ship 100 barstools to Orlando, which will take up about ⅓ of the truck. How much do you need to charge them? Of course, $1000! Now this is an over-simplification of the complex algorithms that carriers use to determine freight rates, but it does illustrate the point that the more of the truck you take up with your shipment, the more you pay.
Weight of the Shipment
You might be tempted to think that weight is the biggest factor in determining your freight costs, but that would be wrong. Weight does play a role, but it’s a smaller role than other variables. For example, according to one freight carrier website, you can ship a 48” x 48” x 60” pallet that weighs 200 pounds from Mercer, PA to Beverly Hills, CA (thank you Beverly Hills 90210 for being perpetually stuck in my brain and giving me a test zip code for life) for around $300. If we double the weight to 400 pounds, the rate only goes up around $50. Triple the weight, and you only increase another $20. How is this possible? Freight shippers use something called freight class, which is based on the density of your shipment: large, light materials have a high freight class, while smaller, denser materials have a lower freight class. As we raise the weight of the shipment, our density calculations go up, and our freight class goes down, which means that our overall rate only goes up a little bit for each additional pound that we ship.
Additional Services (Accessorials)
Accessorials are small additional services carriers provide that add up in a big way. Need a phone call before delivery? That’ll be up to $25, please. Want a lift gate to lower your pallets to the ground? They can range between $50 up to $200 depending on the carrier. Want the driver to bring your freight into the building? Don’t even ask! The point is that accessorial charges can be expensive, and should be avoided when possible.
