The Crucial Role of Freight Class in Shipping

As any long-time shipper will attest to, shipping is a deceptively complicated process for all parties involved.

For business owners, securing the best rates you can on reliable shipping services can require an extensive knowledge of how the industry works.

One often-overlooked factor that plays a pivotal role in the shipping industry is freight class.

In this blog, we will delve into the significance of freight class, highlighting how an intimate understanding and strategic application of this classification system can translate into substantial cost savings, heightened efficiency, and streamlined operations for businesses.

Understanding Freight Class

Freight class is a standardized classification system that categorizes shipments based on their density, value, ease of handling, and other relevant factors.

Central to this classification is the National Motor Freight Classification (NMFC) system, utilized across North America, including Canada, to assign freight class codes ranging from 50 to 500.

Cost Savings Through Accurate Classification

The accurate classification of freight is more than a mere administrative task; it is a direct pathway to cost optimization.

One of the primary reasons freight class is crucial for SMBs is its direct impact on shipping costs.

Shipping rates are determined by the combination of freight class, weight, dimensions, and distance traveled. Accurate classification ensures that businesses are not overcharged for shipping services.

By identifying the correct freight class for their products, SMBs can optimize costs, resulting in significant savings over time.

Source: Rose Pallet

Preventing Billing Adjustments and Disputes

Incorrect freight classification can lead to billing adjustments, where carriers reevaluate the charges based on the actual cost of transporting the shipment.

This not only causes financial strain but can also strain relationships with carriers.

By understanding and correctly assigning freight class, businesses can avoid these billing adjustments, fostering positive and transparent partnerships with shipping providers.

Enhancing Logistics Efficiency

Freight class isn't just about cost; it's a critical determinant of how goods are handled during transportation.

Higher freight class items may require specialized handling and storage, affecting the overall logistics process.

By accurately classifying shipments, SMBs can ensure that carriers are adequately equipped to handle their products, reducing the risk of damage and delays.

This contributes to a more efficient supply chain, with goods reaching their destination in optimal condition and within the agreed-upon timeframe.

Optimizing Packaging Practices

Freight class is closely tied to the dimensions and weight of shipments.

Businesses that understand the freight class system can tailor their packaging practices to optimize shipping costs.

This involves efficiently utilizing packaging materials to reduce the overall dimensions and weight of shipments, ultimately leading to lower freight class codes and more cost-effective shipping rates.

Navigating Cross-Border Shipping Challenges

For SMBs engaged in cross-border trade, accurate freight class determination becomes even more critical.

Different countries may have varied classification systems, and compliance with each is essential to avoid complications at customs.

By proactively understanding and adhering to freight class standards, Canadian SMBs can navigate potential cross-border shipping challenges seamlessly, reducing the risk of delays and customs-related issues.

Educational Resources and Tools

Fortunately, numerous educational resources and tools are available to assist shippers in determining the correct freight class for their products.

Several online calculators and similar resources are easily found and readily available, as well as official resources available directly through the NMFTA website.

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Talk to one of our shipping experts today and see how Freightcom can help you ensure that your freight shipping is top-of-the-class!