End to Honor System
Satish Jindel • Journal of Commerce
December 12, 2016
In recent months, many shippers have expressed concern about accuracy of billing by less-than-truckload carriers. Having pushed the LTL carriers to be more vigilant with making correction for weight and other aspects of shipments for proper revenue capture, SJ Consulting researched the validity of such perception by conducting an extensive survey with several large LTL shippers, 3PLs, and freight audit and pay firms, with particular thanks to Williams & Associates. The freight charges on LTL shipments by these companies exceed $8 billion over a 12-month period, representing 22 percent of the total industry revenue.
To understand the results of the survey, it’s critical to address the context that may be creating the perception of billing inaccuracy among the shippers. For decades, the LTL industry has relied on an honor system for shippers to provide true characteristics of their shipments, required to accurately bill the customers for their shipments. The key attributes required on the bill of lading included weight, freight class (to reflect density, stow ability, handling, and liability), number of pallets, and/or number of pieces (think packages) in the shipment…Read More