July 3, 2023

Don’t Fall for Pricing Tricks

Freight carriers’ marketing teams use various tactics to encourage you to spend more money. One of the most effective methods is through their pricing strategies. Carriers understand that many consumers may need help comprehending the complexities of freight pricing and have studied ways to influence their customers’ decisions. Therefore, it’s important to be aware of these tactics and make informed choices.

In any transaction between a buyer and a seller, the price of a product or service is determined by demand and supply in a market, and economists have formulated models to explain various types of pricing psychology. For example, the higher the price, the more suppliers are likely to produce. Conversely, buyers tend to purchase more at a lower price.

Breaking down last-mile delivery costs

Did you know that deliveries are the most expensive part of shipping, accounting for about 40% of the total cost? This is because last-mile delivery is the final step of the supply chain process, and many factors can impact its overall cost.

To ensure efficient and timely delivery, a top-notch logistics process should consider the following factors:

  • Optimal route selection to avoid unnecessary stops and delays
  • Selecting the best roads to avoid traffic congestion
  • Prioritizing the order of delivery for multiple destinations
  • Considering the cost of returning to the warehouse if necessary

However, even with the best route, there may still be delays due to various factors, which can be expensive to predict.

logistics costs analyzer

Four major factors in freight pricing

Outstanding packaging

When shipping a package, remember that carriers determine shipping costs based on the total weight of the box, not just the weight of the product inside. As a general rule, lighter and smaller packages will cost less to ship.

Fuel cost

Fuel costs are dynamic and might constantly increase or decrease without notice. As a result, the cost of gas directly impacts the overall delivery pricing. It’s important to consider factors such as traffic lights, car accidents, and traffic congestion, which can’t always be avoided and should be factored into the delivery costs.

Failed Deliveries

It is not always possible to prevent or avoid a failed delivery. This factor is one of the most frustrating for shipping companies. Failed deliveries usually happen due to transportation accidents, wrong items, or the recipient’s inability to receive the package. An effective tracking system that keeps the sender and recipient informed about the status and ETA might help to prevent failed deliveries.

Customer satisfaction

If the shipment service is not excellent, it will directly impact the manufacturer and the carrier. An outstanding customer experience includes timing, product quality, installation, if applicable, and overall personal service. Even so, returns and refunds are expected to be a smooth process as well.

Other crucial factors that can affect truck shipping rates include:

  • Delivery time
  • Destination
  • Taxes and custom rates
  • White glove service
  • Insurance

At Last Mile Logistics, we know that freight quotes can cause headaches when breaking down costs. That’s why we are here for your best convenience. Our logistics experience and, more importantly, customer service will make us your trustworthy transportation partner. No more hidden and shady numbers! Come with the pros for reliable and empathic counseling.