CWT rates in bids

mtltrans

Active Member
10
A question. How does everyone else here deal with bidding using CWT rates? This seems to be problematic, especially since some bids don't use the usual cwt categories (Min, LTL, 500, 1000, 2000, etc.). Example: 500-750 lbs, etc. Not a fan of this style of pricing at all. Comments or thoughts?
 

PackRat

Site Supporter
20
A question. How does everyone else here deal with bidding using CWT rates? This seems to be problematic, especially since some bids don't use the usual cwt categories (Min, LTL, 500, 1000, 2000, etc.). Example: 500-750 lbs, etc. Not a fan of this style of pricing at all. Comments or thoughts?
You need to have a firm handle on your costs. Be proficient in XL and the product you are bidding on and good at Math and cube rules. Even then it's still a gamble that you've done the math right for some of the weight breaks.
PR
 

Jim L

Well-Known Member
20
A question. How does everyone else here deal with bidding using CWT rates? This seems to be problematic, especially since some bids don't use the usual cwt categories (Min, LTL, 500, 1000, 2000, etc.). Example: 500-750 lbs, etc. Not a fan of this style of pricing at all. Comments or thoughts?
CWT pricing can really be a problem unless you have full knowledge of the freight. Here are two scenarios:
Bricks - 20,000 lbs, Pillows, 20,000 lbs. The one will take a half trailer, the latter may need 2 full trailers - how do you price that properly.

Usually the customer will provide you with a freight class. The freight class will determine the density of the goods. Bricks will be a lower class and pillows will be much higher. Then you will find out the next scenario: they ship 10 boxes, 1000lbs - the driver shows up to pick them up and there is 1 box on 1 skid that cannot be stacked.

CWT pricing works well for courier companies and large LTL companies who will man handle freight and most likely throw the skids away.
 

loaders

Site Supporter
30
Try your best to convince the customer to go with a skid spot rating system. Unless you are dealing with the large US and Canadian LTL carriers, everyone else will quote you per skid. As Jim mentioned, the LTL carriers jam every possible bit of freight they can in their trailers to optimize revenue. Of course to do this they need adequate dock space and plenty of manpower plus straight trucks for pick ups and deliveries. If your customer is asking for this rate system chances are good they are already using a larger LTL carrier.
 

Deisel1

Active Member
15
CWT RFQs can be very tedious and time-consuming. Unless you have a direct link to attain the business, you may find this exercise unproductive.

I agree with Loaders, most likely, they're already dealing with a larger Canadian/US LTL carrier, which would make attaining the business near impossible.
 

Jim L

Well-Known Member
20
I agree with Loaders, most likely, they're already dealing with a larger Canadian/US LTL carrier, which would make attaining the business near impossible.
If the shipments are infrequent and very light you will have a hard time attaining the business but if the freight has some weight to it (1200+/skid) then you have a chance. CWT pricing usually benefits light shipments and penalizes the heavier ones. Ask the customer to get all the invoices from the other incumbent company because their initial invoice for the movement will be a good price but then another invoice will follow, sometimes months later, for other charges due to over size, freight hanging over the pallet, change in class, tailgate delivery, haz mat premium, fuel surcharge, premium delivery area, redelivery charges or expedite. These have to be considered in the total cost but these secondary invoices usually get glossed over. At a previous place I worked at we caught a scenario where a carrier charged twice for the same shipment on two separate invoices - even their tracking number was the same. One invoice very quickly after delivery and another invoice about 5 weeks later - just long enough for the person signing off the invoices to forget the first one went through and AP to not notice. The PO process was solidified shortly after that.
 
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