Lead Time = Lower Rates
2 minute read
Lead Time and Lower Rates
You can’t fix what you don’t know, right? Take the case of a customer we’ll call Martin. We visited Martin, a logistics manager at a small manufacturer in the upper midwest, a couple of weeks ago. Tall, with a shock of dark black hair, Martin is a sharp dresser with an even sharper mind. He’s what you’d call a quick study. He hasn’t been in logistics long, but he’s getting the hang of how things work.
We were getting to know Martin and his business a little better when he said, “I call you with the loads with the assumption that they need to move today, but the truth is most loads I give you could be moved tomorrow or the next day.” This is kind of a big deal but Martin didn’t know with lead time, we could save him both time and money. We had been operating on the idea that when he called a load in, it needed to move as quickly as possible.
Did you know that with a little extra lead time, you can save between 10-20% on your freight spend?
Lead time is the number of hours between the day an order is made until the pick-up time for that order. Essentially we’re talking about the time it takes to book a truck for your freight.
- Planning is a crucial factor in almost everything we do. So why would it be different when you are trying to get freight on the road at a fair rate? Longer lead times benefit you in a variety of ways.
- 72 hours is an optimal lead time for most truckload freight; however, if you need to secure flatbed equipment an extra day or two is helpful.
- With more lead time, your freight broker has the ability to negotiate better rates with the best carriers. You don’t have to pay spot rates for inferior service when you plan ahead.
- When your freight broker secures great carriers in advance, your customers will reap the benefits in more accurate pickup and delivery times which is good for your bottom line and for your reputation.
You can’t fix what you don’t know.
Lead time is only one of the many ways, the folks at AM Transport can help you save time and money. For more information on how lead time can help and other ways to streamline your supply chain, schedule a call with AM Transport today. We’ve been helping shippers like you for over 30 years.