Securing stable freight rates in the LTL market
Because it’s driven by fluctuating factors like capacity levels, fuel costs and seasonal demand, LTL pricing rarely stands still. If your costs have been inconsistent or steadily increasing, you may be wondering if it’s time to negotiate a fixed rate.
Locking in pricing can offer welcome stability, but it’s not a one-size-fits-all solution. The key is knowing when it makes sense for your business and when it might work against you.
Signs you’re ready for LTL rate agreements
These are the most common signs that a rate agreement could be the right move:
1. You regularly ship in the same lanes
You may benefit from consistent pricing if your shipments follow predictable routes and frequencies. Regular shipments help carriers plan their routes and capacity better, lowering their operating costs and allowing them to offer you better rates.
2. You want to reduce rate volatility
Spot market prices change based on capacity, demand and seasonality. If unpredictable costs are creating budget challenges or slowing down decision-making, a rate agreement can offer more stability.
3. You're spending time shopping rates for every shipment
Rate agreements streamline the quoting process. Instead of evaluating new spot quotes every time you ship, you get faster access to pricing and can focus more on managing freight.
4. You want to build stronger carrier relationships
If you’ve identified LTL carriers that consistently perform well for your lanes, securing rate agreements can deepen those partnerships and provide opportunities to improve performance over time. Working with the same carrier regularly gives both sides a clearer view of what's working and where there's room to improve. That familiarity can lead to process refinements and fewer errors.
5. You’re trying to improve freight budgeting and forecasting
When shipping costs are a larger line item in your budget, they often become part of broader procurement conversations. Negotiating LTL rate agreements can help bring structure to that conversation, supporting long-term planning and greater control over transportation costs.
6. You need to standardize pricing across multiple locations
If you’re managing freight for several facilities or departments, negotiated rates can centralize and simplify your transportation strategy. This can help improve visibility into freight costs and make it easier to manage transportation as a whole.
7. You’re scaling operations
As your business grows, your shipping needs become more complex. Rate agreements can lay the groundwork for a more efficient and strategic freight program that can grow with you. Learn about using LTL to scale your business.
Getting the most from a long-term pricing strategy
When used thoughtfully, LTL rate agreements provide a foundation for stronger carrier relationships and more predictable freight costs. But it’s important to remember that not every lane or shipment needs the same pricing approach. Taking a balanced approach to LTL pricing models can ensure the decisions you’re making align with your overall business needs.
By selectively applying long-term agreements where they add value, you build a more resilient and adaptable transportation program that supports your growth and operational goals.
Let’s discuss your options
If you’re considering negotiating LTL rates, we’re here to help. Our team can evaluate your shipping patterns, identify opportunities and develop a plan that fits your unique needs. Get in touch with an LTL expert today or explore these helpful resources to learn more:
LTL pricing e-book
