Understanding Truckload Capacity
Understanding Truckload Capacity. The current market is one of limited capacity – but what does that mean when it comes to full truckload? What are the effects that capacity, whether excess or limited, can have on your shipping strategy? Understanding truckload capacity is a key element in keeping your shipments moving smoothly and successfully. Let’s breakdown what it all means.
What Is Truckload Capacity?
Truckload capacity is the availability of drivers and equipment to transport your shipment. Capacity fluctuates rapidly at times, and these changes affect how much it costs to ship your goods. When truckload capacity is reduced, rates increase because drivers and equipment are limited. However, when truckload capacity increases and isn’t so tight, truckload rates decrease because more drivers and equipment are available. These changes in truckload capacity throughout the year can drastically impact how much it costs to ship your full truckload cargo and how many shipping options are available to you.
What Affects Truckload Capacity?
When it comes to shipping, there are certain things that affect truckload capacity. For example, the logistics industry is facing a truck driver shortage. If there aren’t enough drivers to transport shipments, then capacity will tighten, and costs will increase for both shippers and carriers. Here are some common things that affect truckload capacity:
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Truckload Seasons—Yes, seasons, you read that right. Certain truckload shipping seasons cause truckload capacity to fluctuate. Produce shipping season and peak shipping season are often the busiest for full truckload shippers and carriers. Generally, produce shipping season occurs in the spring and summer, and peak shipping season happens in the late summer and fall. During these truckload seasons, demand for trucks increases, but the supply of available trucks is limited.
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Regional Capacity—Did you know that some areas of the U.S. are considered danger zones for truckers? Certain areas of the country aren’t as appealing to truckers because, while they may be able to find loads in the area, they have a harder time finding loads to take out or backhauls. Typically, these regional, low outbound shipment areas have tighter capacity.
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Equipment—Sometimes it’s easier to find a driver and harder to find the right equipment for your full truckload shipment. Different types of cargo have different equipment needs. For example, temperature-sensitive items may need a refrigerated truck and heavy machinery may need a flatbed. Sometimes the truckload equipment you need isn’t available for that lane. When this happens, it affects truckload capacity because there just aren’t enough trucks with the equipment shippers need at the exact time they need it.
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Driver Shortage—We mentioned this briefly before, but the driver shortage affects truckload capacity for obvious reasons. Without drivers, there simply aren’t trucks moving cargo. According to the American Trucking Associations (ATA), the trucking industry is short by approximately 35,000 to 40,000 drivers.
Other Factors that Affect How Truckload Rates Are Calculated
While capacity is a major reason for fluctuating truckload rates, there are other factors to consider in how truckload rates are calculated. Let’s dive in:
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Shipping and handling: Is your cargo easy or hard to ship? The easier your cargo is to ship and handle, the lower your price will be. Conversely, if your items require extra handling or are hard to be loaded, you could pay more.
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Loading and unloading: Does your freight require additional equipment to load or unload it? Items like heavy machinery may need additional equipment such as cranes to get it loaded or unloaded. Even palletized shipments often require a liftgate or forklift.
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Pickup and delivery destinations: Pickup and delivery destinations affect what you will pay. Carriers want to maximize their truck space, and shipping cargo to a destination that doesn’t have a load to ship back isn’t attractive to them. Look into backhaul and headhaul lanes to find some more affordable rates!
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Expedited freight: Is your cargo on a time crunch and need to be somewhere quickly? Then you may need expedited freight services. Expedited freight costs more than your truckload shipment because it’s an added service. While there are no guarantees in freight shipping, choosing expedited freight services makes your shipment a priority even when uncontrollable delays occur.
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Specialty services: Anything that goes above and beyond the carrier’s standard curbside pickup and delivery will cost you more. Examples of specialty services include white glove service, inside delivery and debris removal, oversize or overlength freight, and first mile/final mile service.
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Insurance: Even though carriers have limited liability coverage as part of each shipment, it may not cover the full value of your cargo. You may need to purchase freight insurance from a third-party insurance provider.
Finding Truckload Capacity and the Right Equipment with a 3PL
Working with a third-party logistics provider (3PL), like FreightCenter, gives you the expertise and guidance you need when it comes to full truckload shipping. We have a dedicated truckload team that stays up to date on the latest truckload capacity trends, equipment, services and more. Our team can help you find the right equipment even during peak shipping seasons, so your cargo is always on the move to your customers. See how much you can save and let our truckload experts help you with your next shipment. If you are having trouble understanding truckload capacity, give us a call at 800.716.7608.
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