Lane Data Needed for Successful Customer Specific Tariff of FAK negotiation

How to successfully negotiate a Customer Specific Pricing Tariff and/or FAK for Freight Shipping!

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       Let’s be honest, every company ideally wants better freight pricing!  CSP or Customer Specific tariffs are one of the best ways to achieve this goal.  Including deeper overall discount %, accessorial exemptions, and potentially a simplified or reduced freight classification in the form of a FAK with a reputable and good freight line.   

       Customer Specific Tariffs or CSP’s and associated FAK’s or freight of all kinds can provide a competitive sales advantage.  Especially in today’s fast-evolving logistics industry.    If you want the best possible opportunity to arrange the most advantageous Carrier Specific program, these are the important data points you will need to provide.

What is the primary objective of your Customer Specific Pricing Request?

  • Better pricing overall?
  • Reduced or exemptions from costly accessorials?
  • Simplification or reduction in freight class in the form of an FAK?
  • Etc.

What is the most important information you will need to supply thorough data on, to successfully gain an advantageous CSP?

  • Generally, your company will need to be spending around $20,000 a month in freight already to apply for a CSP deal.
  • You could also show how some, or all of your ground shipping could be transferred over LTL or freight shipping.  If your CSP request could be successfully arranged to achieve over the $20k minimum threshold.
  • If you are not already shipping with the brokerage or carrier you are requesting the CSP from. You will need to provide thorough lane data.  See the specific data points below.
  • A shortlist of your top carriers you would ideally like to work with
  • A shortlist of carriers you would ideally like to not work with
  • Top 5 important items you are looking for in your potential carrier?  Cost, service, customer service, reporting, ability to automate the logistical process more via API or EDI?
  • If you currently have a class simplifying or reducing FAK you will need to present it.
  • Any information or specifics that might aid in the stowability of your freight.  E.I. making your freight shipments further compact, and dense to maximize the load capacity of the carrier’s trailers.
  • If utilizing a 3PL warehouse or drop ship location, you will also need to include this information/pick up address.
  • Carriers will also want to generally know what percentage of your freight shipping will go business to business, residential, military bases, terminal pick-ups, conventions, construction sites, or any other non-traditional business to business shipping points.
  • To what consignee or delivery points and the % you generally are shipping to those consignees.  This is also to see if you are shipping to larger retailers who have may specific routing instruction and delivery instructions.
  • What commodities you are shipping including, description, class, nmfc-sub-code, and the % shipped
  • How the items are generally packed to ship? EI on pallets, boxed, rolls, bales, etc.
  • Insurance requirements needed for your cargo and replacement cost per item and/or in many cases per pound.
  • Any specific loading and unloading procedures carriers will need to comply with, live load, spotted, etc.
  • Can your freight be stacked, top-loaded, or racked?

Lane Data Carriers Generally want to see Consists of the following:

  • Average number of pallets per shipment or loose piece count if shipped loose?
  • Average weight per pallet?
  • Number of shipments per month?
  • Average Revenue per month?
  • Dimensions and density of palletized quantities
  • How many shipments per day, week, month approximately?
  • Finally, a fully itemized list of several average months of shipping data.  Usually in spreadsheet form, including origin zip code, origin state, destination zip, destination state, actual freight class, weight, pallet count, piece count, incumbent carrier charge, incumbent accessorial charge, and finally accessorials used.
CSP Lane Data Normally Required for Carriers

     If your company can provide the following information in an organized manner, your chances of arranging a successful CSP or FAK will be greatly enhanced.    If your firm is using a technology forward brokerage organization, or a robust TMS you should be able to easily load your new CSP tariff into the system.    Allowing your shipping team to easily shop your new CSP alongside your other carrier options.    If the CSP process was successful, your new tariff should garner most if not all of your freight shipping needs.    If you would like help with this process our pricing team would be happy to make your CSP bid easy, organized, and ultimately successful for you!

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