As the demand for fresh and frozen produce continues to grow, the transportation of temperature-sensitive freight has become increasingly vital. To ensure the safe and efficient delivery of perishable goods, shippers increasingly rely on refrigerated (reefer) freight experts for maintaining product integrity throughout the cold chain journey.
However, getting the best rate quotes for these freight services can be tricky, considering the reefer market is usually considerably tighter than its dry van counterpart. Today, the average national reefer capacity is 7.06 loads-to-truck, and reefer freight rates are averaging $2.47 per mile. However, these figures heavily depend on the region where the supply chains operate. With the best freight quotations, these businesses can save costs while ensuring streamlined activities.
Refrigerated freight is a specialized shipping option that businesses dealing in temperature-sensitive goods such as foods and drugs can leverage to maintain the integrity of their shipments throughout the transportation process.
Shippers who move reefer freight use temperature-controlled trailers to provide and maintain the ideal temperature and humidity levels for the product(s) being transported, minimizing the risk of spoilage or degradation.
Examples of goods transported using the reefer shipping option include:
Because of the unique nature of reefer freight, shippers face many challenges that can be complex to navigate. This section highlights some of those challenges.
The goods transported using reefers typically require a certain temperature range to maintain product safety and quality. The reefer service provider must invest in specialized equipment and have expertise in maintaining precise temperatures throughout the shipping process.
Because of the nature of the reefer freight, strict regulations and guidelines have been established to ensure safety for businesses and consumers. Adhering to these rules can be troublesome, and failure to do so could result in delays, fines, rejected loads, and reputational damage.
For the reefer freight to be done successfully, equipment, tools, systems, and infrastructure must be in place, such as specialized refrigeration units, power sources, and maintenance, to ensure the proper functioning of the reefer trailers and containers. However, having all of these in place necessitates substantial investments, and then there is the hiring of experts and leveraging technology solutions such as telematics to operate them effectively.
Naturally, stakeholders' additional requirements to implement and navigate during the reefer shipments attract higher operating costs.
Reefer freight operating costs can quickly spiral if processes don't flow smoothly, especially when working with a partner lacking adequate infrastructure. This makes it necessary for businesses to find the right balance in choosing or getting the best quotes for the freight shipment. Here are six strategies that will help any business achieve that:
Information allows your business to avoid costly mistakes, and that involves you collecting and providing precise details about the reefer shipment. These include knowing and providing the when, where, what, and handling needs of the reefer shipment. This way, there are no misunderstandings between you and the reefer logistics provider.
Accurate information will give you a good foundation for quotes because it allows the logistics provider to tailor the quotes and service to only what is necessary for your shipping needs. This way, you can easily avoid unexpected costs or delays due to miscommunication.
Negotiation is an art; a key part of negotiating involves the ability to leverage. That could include several factors, including the quantity of goods, information about the market, or relationships.Here are a few considerations that could help you negotiate better terms and contracts for your business:
Getting into the negotiation room with a low price in mind is excellent. Still, it doesn't trump building reliable, long-term relationships that can lead to a better overall reefer shipping operation for your supply chain. Focusing on long-term partnerships gets you everything you need in the long run, whether better rates or priority services in the future.
Only negotiate after knowing the current market rates and the reasons behind those rates. Doing that puts you in a strong position, and helps you come out of that negotiation with good results for your operations. Understanding the market enhances your ability to get a fair deal for the company.
Early shipment bookings allow you to take advantage of the low demand for better deals. Delaying it to last-minute booking puts your business in a position where it is auctioning or spot booking for rates, inevitably leading to higher costs amidst limited capacity availability.
There are multiple reefer businesses. Getting quotes from a few of them allows you to compare and contrast these quotes and the deals that come with them. This increases reefer shipping options and allows you to partner with the carrier that better aligns with your shipping needs.Here are a few strategies that will help you manage these:
A detailed breakdown of quotations allows you to vet the quotations properly, discover hidden charges, and understand what your business is getting into. The detailed quotation will typically break down all costs, including base rates, fuel surcharges, and accessorial charges.
Good prices are great, but other factors must be considered before deciding on any quotation and service provider. Some of these include carrier reputation, reliability, on-time performance, and available technology solutions.
Leveraging a freight broker can save your business a lot of work or stress when finding carriers. They can provide access to a broader network of carriers and help you collect and compare competitive rates.
Industry indexes provide you with accurate and real-time information or insights into the current conditions and trends of the freight market. With these tools, your business can:
Diversity is the mother of resilience, and in your reefer freight, it could make all the difference in securing lower rates and reducing operational costs. To leverage this, you can:
It works for long-haul shipments to potentially reduce costs and environmental impact. A common example is the seamless combination of truck and rail transportation, allowing for easy and efficient transfer of goods between the two methods.
Although this can be complicated for reefer shipments, especially for rare products with unique temperature needs, LTL can be quite cost-effective when your shipment does not need the full truckload option.
Strong relationships with carriers or reefer logistics providers put your business in the driver's seat in the long run. This is especially true for a market reeling with fluctuating demand and freight prices. Building strong relationships enables your business to stay resilient, and ensure dedicated capacity even when the market condition gets tough.
When building relationships, consider adding on value-added services such as:
Strong relationships with carriers allow your business to build trust with carriers that ensures the following:
When you have a relationship with carriers built on trust and with a long-term perspective, they are increasingly likely to offer preferential rates and prioritize your shipments. However, the single biggest factor in maintaining such a relationship is to continue using leverage to deliver your end of the bargain.
With a strong relationship, your business can enjoy favorable terms and accommodations that may not readily be available to the public. Some include longer payment terms or exchanging goods instead of cash for services.
Open and transparent communication with your carriers allows your business to tweak the process to benefit both parties. This is achievable through constant feedback and providing a platform for both parties to address any issues promptly.
When your goods have the added complexity of temperature requirements, you need an experienced partner. Continental Logistics brings years of cold chain specialization to provide optimal quality and peace of mind. We combine tailored solutions, quality, efficiency, and exceptional service to give you a competitive advantage. It’s how Continental Logistics has been serving our customers since 1983.
With Continental Logistics, you have:
Talk to an expert at Continental Logistics today to get market-beating quotes for your reefer shipments.
