Why do shippers use LTL Blanket Pricing?

LTL Blanket Pricing Strategy

Blanket Rates: The Standard Leveraged Approach

Blanket rates are the standard, one-size-fits-all pricing schedules that LTL carriers use to quote the majority of shippers. Motor carriers develop these rates internally based on factors like:

• Distance
• Origin/destination
• Number of pallets/handling units
• Total shipment weight
• Freight class
• Any accessorial services required

For shippers with consistent but lower freight volumes, blanket rates offer simplicity even if the pricing isn't optimized just for you. Most LTL shipments move under blanket rates.

Customer Specific Pricing: Tailored for Your LTL Needs

As the name implies, customer specific pricing provides custom pricing for an individual shipper's lanes and freight characteristics. With CSP, the carrier negotiates pricing directly with the freight brokerage company to meet their specific operational requirements.

The benefits of CSP include:

• Cost certainty through fixed pricing
• Customized Cargo Liability
• Customized Accessorial LTL pricing
• Reduced volatility of accessorial fees
• Pricing stability for non-standard freight
• Less internal resources required

CSP is ideal for shippers with higher freight volumes (typically over 100 LTL shipments per month) or those with challenging freight that is subject to excessive LTL accessorials under blanket rates.

Is Custom Specific Pricing (CSP LTL Pricing) right for you?

No single threshold determines CSP readiness, but considering factors like these can help:

• LTL freight spend over $200k/year
• Over 100 LTL shipments per month
• Frustration with current blanket rates
• Excessive or unpredictable accessorials
• Significant time spent shopping rates
• Desire for greater pricing consistency
• Non-standard freight subject to more fees

If several of those apply to your situation, exploring CSP may provide opportunities to reduce costs and hassle.

The CSP LTL Shipping Process

To initiate CSP negotiations, shippers (or their 3PL partner) will need to provide carriers with detailed supply chain data like:

• Authorization to negotiate on shipper's behalf
• Shipment data for previous 1-12 months
• Freight photos to assess potential claims
• Acceptable pricing parameters
• Freight density/class details

With this information, carriers can analyze their networks to craft optimized pricing for your unique shipping profile.

While CSP has advantages for larger shippers, it's not always the right move. Freight Brokers & 3PLs can leverage their total freight volumes to secure blanket rates more competitive than shippers receive directly. An experienced 3PL like TLI can guide you toward the LTL pricing model that best fits your needs.

As shipping volumes rise, LTL pricing grows more complex - but also more critical to manage effectively. Understanding blanket rates vs. CSP is the first step to mastering your LTL costs.