The 2:00 Minute Warning

When Don Kehoe and I started TranzAct Technologies 40 years ago, one thing that became very obvious is that saving money in the freight area is not a “sexy“ proposition. For example, having been to lots of conferences over the years, I always smile when I hear someone say they saved $50,000 on an equipment purchase or insurance deal or some other corporate opportunity. 

But when it comes to saving money in the freight area, often times these savings are achieved one dollar at a time. By that I mean, savings typically involve smaller dollar amounts on transactions that happen hundreds or even thousands of times a month. Add it all up and all those small dollar savings can result in a very large savings number.

As experts in helping shippers save money, here are three proven tips that can help you reduce costs, increase revenues, and boost your bottom line profitability.

Pay Attention to the Details

In the LTL area the “little things can make a big difference” principal plays out on how shippers manage their freight dimensions. For example, when one LTL carrier demanded a sizeable increase for a shipper, citing that the density in pounds per cubic foot had changed significantly, the shipper knew what to do. They called TranzAct. 

When we got in touch, the shipper questioned how the density and freight class could be an issue since their products had always been rated as class 70 products. When we toured the warehouse we got their answer: Roughly 20% of the pallets had about an inch of overhang. That one inch overhang caused the shipments to take two pallet spaces instead of one, completely changing the pounds per cubic foot. With NMFC changes approaching quickly, an inch here and an inch there could cost shippers thousands or even hundreds of thousands of dollars in additional freight charges.

Educate Your Buyers 

Whether you know it or not, there are lots of business decisions affecting freight costs being made by people who know very little about how their decisions will affect freight costs. That is why it pays to educate the people who are using FedEx and UPS about how accessorial charges or service levels can affect your company’s freight costs. For example, when a smart shipper brought TranzAct in to analyze why their parcel shipping costs had suddenly spiked, we identified that they were using their parcel carrier in an unnecessary way. Their buyers were selecting costly services that had not been requested by customers and were not aware of the difference in cost for a package with a requested delivery of 8:00 am versus 12:00 pm. After being trained, they were able to make better decisions and lower their costs.

Be Willing to Change and Innovate

Often times, when TranzAct is brought in to lower costs or help companies increase their revenues, we begin the project by asking: What is your company willing to change? For example, one shipper brought TranzAct in to lower their parcel and LTL costs. Since they had very good rates and good processes, we recommended that they increase their shipping and handling charge for parcel shipments by $1.50 per shipment. It wasn’t a lot of money and more importantly, their customers didn’t challenge or protest this increased charge. But that one small charge and change increased their annual revenues by almost $300,000. That is what can happen when shippers effectively manage smaller transactions that happen hundreds or thousands of times a month.

Heading in to 2025, here is an important question: Is your company committed to paying attention to the small details that can make a big difference and boost your profitability? If so, then let’s have a chat about how TranzAct’s Rapid Assessment can help uncover and address ways to reduce your freight costs and boost your profitability. 

The Rapid Assessment is an in-depth evaluation of your transportation strategies that looks at the little things and will involve learning about your current practices, gathering data to understand where you're at currently, and hearing advice for ways to optimize your plan. It can take place remotely or we can visit your office for an on-site review. The Rapid Assessment has also proven to be a very effective tool in helping companies not just identify the little things but develop an action plan to change practices and processes and unlock savings.

And when coupled with some of TranzAct’s other tools and technology such the actionable insights gleaned through our Freight Audit and Payment platform or our Constellation TMS, great things can happen.

Now if you’re interested in learning more, simply contact us or better yet, let’s set up a one–on–one discussion via Calendly.

BY MIKE REGAN, CO-FOUNDER OF TRANZACT

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