Aggregate Low Volume Lanes, Lower Transportation Costs

Research by students at the MIT showed that shippers who aggregated low volume lanes acquired favorable pricing.

<p>Research by students at the Massachusetts Institute of Technology showed that shippers who aggregated low volume lanes acquired favorable pricing. See how aggregating lanes and contract pricing can save shippers up to 15 percent.</p>

Research by students at the Massachusetts Institute of Technology showed that shippers who aggregated low volume lanes acquired favorable pricing. See how aggregating lanes and contract pricing can save shippers up to 15 percent.

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By · September 21, 2011

By default, most shippers send RFPs that ask carriers for point-to-point pricing on long haul loads (moving more than 250 miles from origin to destination). As a result, most lanes will be classified as “low volume,” subject to more costly spot market pricing, rather than contract pricing. Our research shows that by aggregating low volume lanes—by defining origin and destination sizes more broadly than point-to-point—shippers can increase the total shipments moving in a lane at more favorable contract pricing, saving up to 15 percent over spot market rates.

Research by students at the Massachusetts Institute of Technology showed that shippers who aggregated low volume lanes acquired favorable pricing. See how aggregating lanes and contract pricing can save shippers up to 15 percent.

Shippers may already have a general sense that combining and redefining some lanes—particularly those identified as being low volume lanes—could lead to transportation cost savings.


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From the January 2018 Logistics Management Magazine Issue
Industry experts agree that costs across all sectors worldwide will continue to rise in 2018, and the most successful shippers will be those that are able to mitigate their impact on profitability. And, the right technology will play an increasingly vital role in driving efficiencies across the global logistics network.
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