Top 10 Factors Affecting LTL Rates

Top 10 Factors That Determine LTL Rates in 2023

When considering LTL shipping options, product safety and shipping convenience are usually top of mind. However, other important factors affect LTL rates you may not be aware of. LTL freight shipping rates can be very confusing, but by understanding what affects them, you can better conclude what may be right for your business.

Here are the top 10 factors that affect LTL rates regarding ground freight within North America.


1. Size of your LTL Shipment

Size is an influential factor in determining LTL freight shipping rates. Carriers must optimize space while ensuring the product is not damaged and coordinate pricing based on these organizational factors.

2. Weight

Weight is another critical determinant of LTL freight rates, which is based again on carriers building their trucks appropriately. Carriers need to ensure freight weight is evenly distributed throughout the truck while abiding by provincial and state laws regarding maximum weight.

3. Freight Class

When shipping in the United States, freight rates are based on freight class. This is determined by the National Motor Freight Classification (NMFC) system. Each product is categorized based on density, value, or transportability specifications.

4. Distance

Shipping to locations outside of main cities will increase the cost of shipping. If a shipment is sent to a location outside a carrier’s normal service area, it must be transferred to another LTL for delivery. This results in higher costs based on the distance your shipment needs to travel.

5. Required Transit Time

Rates vary depending on the required transit time. The rate can be substantially higher if your freight has a strict deadline and expedited or air service is required.

6. Rating System

Freight rates are often based on a hundred-weight rate (CWT) when shipping within Canada. This means that the carrier has set a rate per hundred pounds of freight; this allows the carriers to charge for the specific weight of the cargo.

7. Minimum Charges

All carriers have a minimum charge, which ensures that they can ship packages of any size without the risk of losing money. If your freight is small enough, a more cost-effective mail service option may be more suited to your needs than an LTL carrier.

8. Additional Charges

In addition to your LTL shipping costs, carriers charge extra for required accessorial charges like the use of a power tailgate or a residential and driver-assist delivery. Depending on the importance of these options, these fees can be reduced by arranging for the consignee to pick the freight up from the nearest carrier depot.

9. Loyalty

Carriers offer better rates for customers that ship higher volumes of freight. The benefit of using third-party freight forwarders is that they have likely built up loyalty discounts that they can then pass to their customers.

10.A Changing Carrier Landscape

In the last couple of years, carrier consolidation has been another factor creating more pressure on LTL rates. With fewer players in the market, shippers may have limited options for choosing carriers, making it harder to negotiate lower rates.

At Radius Logistics, we do the legwork to create the best combination of rates & service to ensure your shipment is delivered on time, and we act in the best interests of our clients, negotiating the best rate possible.

Contact us today to discuss how we can accommodate your shipping needs!