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.

in the News

UPS and China-based SF Holding to launch joint venture
Motors, gears and drives MRO
Hub Group announces plans to acquire Estenson Logistics
MRO Technician Spotlight: Derek Ingram, Carolina Handling
MHEFI announces call for nominations for 2017 awards
More News
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.


Subscribe to Logistics Management Magazine!

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your entire logistics operation.
Start your FREE subscription today!

Latest Whitepaper
Unlock the Value of Your Supply Chain Through Embedded Analytics
Learn how embedded analytics can provide deeper supply chain intelligence and help you extract maximum value from data for your supply chain operations
Download Today!
From the May 2017 Issue
Everyone is talking about terms like digitization, Industry 4.0 and digital supply chain management, but what sort of technologies fall under these broad terms, and how will they change the management capabilities at our disposal? To find out, we talked to some noted supply chain analysts, consultants and technology executives and gathered six digital trends to watch.
Transportation Trends and Best Practices: The Battle for the Last Mile
2017 Technology Roundtable: Are we closer to “Intelligent” Logistics?
View More From this Issue
Subscribe to Our Email Newsletter
Sign up today to receive our FREE, weekly email newsletter!
Latest Webcast
Going Beyond Rate Negotiations for Logistics Cost Savings
The pressure to reduce cost is a fundamental part of every organization today leaving many supply chain professionals constantly renegotiating rates. This webcast examines four areas that may hold untapped savings potentials and even help organizations negotiate better rates.
Register Today!
EDITORS' PICKS
The Evolution of the Digital Supply Chain
Everyone is talking about terms like digitization, Industry 4.0 and digital supply chain management,...
2017 Salary Survey: Fresh Voices Express Optimism
Our “33rd Annual Salary Survey” reflects more diversity entering the logistics management...

LM Exclusive: Major Modes Join E-commerce Mix
While last mile carriers receive much of the attention, the traditional modal heavyweights are in...
ASEAN Logistics: Building Collectively
While most of the world withdraws inward, Southeast Asia is practicing effective cooperation between...