Best Practices to Implement for Truckload and Less than Truckload Shippers


Shippers face increasing difficulty in successfully navigating the marketplace because of unprecedented volatility within the supply chain. The transportation industry and freight companies have faced volatility over the last handful of years, but nothing like the disruptions of recent months. From a shift in shipping smaller, more frequent orders to capacity shortages and missed customer requirements—truckload and less than truckload (LTL) shipping companies need ways to navigate the changing marketplace. The need to manage spend without sacrificing speed and increase efficiencies has never been more prevalent.

We apply best practices that hold true in any market as we collaborate with shippers on new approaches and strategies to reach their goals. In spending time with shippers throughout my career, including as a regional transportation manager, I have experienced these insights in action through a variety of market conditions. Using C.H. Robinson’s information advantage—a combination of our shipping data, experience, and scale—and research with several universities, we found three ways to improve your logistics performance.


Improve your truckload or less than truckload (LTL) strategies with 3 key insights

Develop a small supplier base

There are high performing suppliers to choose from among both asset and non-asset based service providers. It’s now been proven, it’s not efficient to use dozens, much less hundreds of transportation suppliers. Top-performing freight shipping companies successfully review and reduce the practically infinite number of choices to a reasonable amount.

I often find many have a large number of suppliers, but only a handful of those cover the majority of loads. Try to limit your suppliers to the top performers that deliver and pick up on time. This can dramatically reduce costs, while increasing efficiency.

Our research conducted with MIT and TMC, a division of C.H. Robinson, indicates that leading shippers get better performance in terms of on-time pick up and on-time delivery, and better price from suppliers—when they limit the number of suppliers to a finite number. Depending on your organization, this could mean anywhere between seven and thirty suppliers per location—but your ideal number of suppliers will vary, based on your lanes, service mix, and unique business factors.

The right mix of top-performing suppliers is key

Your success depends on which suppliers you choose, in addition to limiting the number of suppliers you use. Matching the strengths of your suppliers with your own service corridors leads to better performance. Because suppliers naturally have more assets in some lanes than others and focus their efforts in a smaller geographical coverage area.

This principle also applies to larger suppliers with wider geographical coverage. They become regional leaders in certain lanes, making them a strategic choice in those lanes. Top performing shippers engage suppliers who fit into specific roles based on freight characteristics, location, and corridors.

Top-performing shippers also engage suppliers that fit specific strategic roles to optimize service levels while fulfilling demand from different geographical areas. Focus on quality service suppliers and respect the attributes of your portfolio segments by using a blend of brokerage and asset. By engaging a mix of both asset and non-asset suppliers strategically and using fewer suppliers per origin, you can bring some elasticity to your strategy to help address demand variability within a lane.

A reasonable market representation is that about 80% of a shipper’s loads are in 20% of the lanes—and that 20% of their loads are in 80% of the lanes. Those 80% of the loads in 20% of the lanes typically present attributes that work well for route guide commitments. The 20% of shipments in 80% of the lanes may require a route guide strategy with more carriers and/or a 3PL. A 3PL can help aggregate the market and find suppliers available near term who align with the attributes of each type of load. This approach often provides real value for variable demand.

Always plan for the LTL market

Changing consumer expectations have propelled shippers—specifically those with LTL freight—to send smaller, more frequent orders with tighter deadlines and smaller quantities. No matter the market dynamics, planning and analyzing factors that cause variance in your LTL performance is vital.

Freight attributes and processes contribute to overall shipment performance for LTL companies. Shippers of all sizes can better manage expectations for LTL performance by reviewing key factors:

  • Optimize capacity networks: As carriers, specifically LTL carriers, look to be more productive, we’re seeing a large emphasis being placed on optimizing their networks. LTL carriers are paying more attention to accepting the right freight in the right lanes at the right time with data, analytics, and tools like dimensionalizers available to them.
  • Proximity to the LTL terminal: Origin locations further from the LTL terminal perform best in on time pickup (OTP). Outlying points might not perfectly optimize every day, leading to some OTP and on time delivery (OTD) variability. While origins located closer to the terminals may prove more challenging for route and hours planning. Despite this, being closer to the terminal means that a shipper has a better chance that a second truck can still come and pick up the shipment on the requested day.
  • High volume corridors: Our research with MIT and TMC, shows lanes with predictable demand patterns perform best, while lower volume corridors tend to be more challenging for planning and optimizing routes because of less predictable tender cadence.

Improving your overall transportation strategy

Across the country, there are economic corridors that are over and under supplied because of a variety of reasons. As we continue to face market volatility, it is increasingly challenging to forecast and plan your truckload procurement strategies.

To become a top shipper amidst changing capacity environments, it’s important to collaborate with a provider that can bring you access to a global suite of solutions, insights to enhance your annual RFP process, and unmatched expertise from people you can rely on. This balanced approach can help maintain an agile transportation strategy that aligns the right corridors at the right time with the best carriers for your truckload and LTL freight in any market condition.

C.H. Robinson offers tailored, market-leading solutions that can help you navigate the transportation landscape, enhance your supply chain performance, increase cost savings, and provide you with smart solutions for your business.