On Thursday, April 7th, AMTR was pleased to announce its scholarship recipients at the University of Central Arkansas’ College of Business awards. Ms. Karen Valentino received the Management Information Systems scholarship and Mr. Jesus Chavez, the Supply Chain Management scholarship. Congratulations to these
deserving winners!
Multiple times per year, the National Motor Freight Classification (NMFC) manual is revised through the issuances of supplements. Some of the most impactful changes made by these updates are the cancellation or alteration of article classifications. Most supplements issued by the NMFC contain dozens of items which are canceled, added or altered. It is critical for shippers to be aware of the class changes within these supplements and when they are effective, as these changes have big repercussions on shipping costs.
Shippers may use templates for their bills of lading with pre-determined NMFC item numbers and descriptions. They may even afford blank areas for weight, dimensions, number of packages, type of package, etc. If the template contains an item which was canceled or altered by a NMFC supplement, the shipment will be vulnerable to carrier inspections. These templates may remain in error for years. When carrier billing clerks encounter a canceled classification, a generic class may be applied that is more costly. Sometimes, a density based NOI class will be utilized as a default option.
AMTR is diligent in reviewing item cancellations and updates from supplements before they become effective and affect your shipping costs. Let us assist in avoiding any costly oversights!
As a knowledge-intensive company, AMTR has to be aware of what constitutes our mission-critical knowledge, as well as the nature of it—explicit or tacit. Explicit knowledge is defined as the kind of knowledge that we can write down and share with others in instructions, manuals or databases. It can also be easily captured, stored and transmitted. Tacit knowledge, however, includes know-how, rules of thumb, experience, insight and intuition. This type is hard to capture, express or transmit. Although AMTR’s mission-critical knowledge is both tacit and explicit, tacit knowledge has always been at the core of our business model and is the essence of the “AMTR difference” and competitive advantage.
Much of the hype in the freight cost industry currently focuses on audits using automated technologies such as rate engines, transportation management systems and various payment systems. These are great tools, no doubt, but they are built based on explicit–or codified–knowledge. These tools can identify errors but only within a narrow domain as defined by the codified algorithms and parameters they have been programmed to recognize.
Shippers understand that freight is complex. Some of the complexities that drive freight cost problems include automation, system conversions, governing document accuracy, transportation knowledge loss and tighter payment deadlines. Computers cannot handle many aspects of those complexities very well, and that is where our freight audit experts come into play. Only humans can bring tacit knowledge to bear; only AMTR auditors can look at the big picture and follow up with the questions, research and knowledge required.
When it comes to freight cost audits, shippers have lots of choices. Choose AMTR and experience the tacit knowledge difference!
Genesee & Wyoming (G&W), the US railroad holding company that owns or leases 122 freight railroads globally, has signed an agreement to acquire Atlantic Western Transportation, the parent company of the Heart of Georgia Railroad (HoG). HoG operates across 219 miles of track in Georgia, linking with G&W’s Georgia Southwestern Railroad at Americus, and Georgia Central Railway at Vidalia. Once the STB approves, the acquisition should be finalized by the end of the second quarter.
Mid-January through the end of February is typically the slowest time of the year for motor carrier transportation. As we move forward into spring, carriers can expect increased volumes and shippers may experience higher rates and longer wait times. AMTR has compiled a list of tips that will both help save money on freight and make sure loads are delivered on time.
First, shop around. Get estimates from a number of carriers to ensure you are receiving the best deal for lane. Next, make sure to devote adequate time to packaging your shipment. If a carrier offers discounts for shipments moved on pallets, palletize whenever possible. Likewise, consolidate shipments when it is feasible. Also, try to arrange for shipments as soon as possible. This will save money by avoiding paying for expedited service until it is absolutely necessary. Finally, employ AMTR’s Smart Auditing© to save on your freight costs.
AMTR’s forte is discovering and recovering overcharges during after-payment freight audits. With our vast knowledge and experience with overcharge claims, we can also provide crucial insight about unidentified or duplicate payments and undercharges—information that can save shippers money! The statutes that apply for overcharge claims apply to all of these, as well.
While carriers start “spring cleaning” their accounting, they may send customers new invoices. When additional charges—for instance, an accessorial that was performed and not billed on the original invoice—are billed to customers, a request for payment must be submitted within 180 days from the invoice date, just as overcharge claims are. Check the dates before sending payment. However, if a payment was made in error and is beyond the filing time period, the law clearly allows a carrier and their client to work out any issues and
carriers can issue refunds.
Also note that on payments sent to carriers that cannot be identified, the carrier must send a notice to the payer. If there is not a response within 90 days of the notice, the carrier may consider the payment as owed for freight charges. From this point, a payer is bound by the standard claim procedures and timelines.
Do not let these time restrictions limit your opportunity to receive refunds. Let AMTR’s “Smart” auditors discover and recover your overcharged monies and educate your company through our audits!
Rate engines are a necessity in the shipping industry. However, it is also crucial to do some cleanup of these systems regularly, especially when changes are made to your route options.
Recently, during a freight cost audit, our team discovered an error that cost a shipper over a hundred thousand dollars due to an old route that was left in the rate system. Since the rates had expired under this route option and the freight had already moved, there was nothing to be done.
At AMTR, the education process is just as important as the recovery. By bringing the matter to the client’s attention, they will be able to save future monies by not choosing the incorrect route when submitting instructions to the carrier. When shippers decide in the course of business to offer traffic to competitive carriers, they should consider removing and archiving the prior carrier rate options from their rate engines. Freight cost can be negatively impacted if the expired rate is chosen. The end result would be to rely on non-negotiated public rates, which could add up quickly. Then, the risk of someone choosing the wrong option and costing hundreds of thousands of dollars could be avoided.
AMTR strives to educate shippers in these types of situations to help avoid overpaying freight in the future.
Spring is in the air, which often brings on the motivation to tidy up our spaces and take on other projects which just did not seem right during the long winter. Spring cleaning, whether at work or home, can be a time to look at problems anew and to try different things. With regard to freight cost issues and problems, does your company need a fresh look? A new approach? A new partner?
Adding AMTR’s signature Smart Auditing© to your transportation routine can surely facilitate new process efficiencies and financial savings, but it may also challenge the way things have always been done in your company. Challenging the status quo can be uncomfortable, but AMTR stands ready to help. Keep these ideas in mind from the Harvard Business Review article “Five Mistakes Employees Make When Challenging the Status Quo” as you discuss the potential value of AMTR services:
Don’t go solo. Let AMTR answer any questions about services, process and implementation your company may have. We stand ready.
Don’t flunk the pitch meeting. Focus on the key idea that AMTR discovers lost freight cost dollars and recovers them through comprehensive claims management at zero cost to you.
Don’t give up quickly. New ideas are not always quickly accepted, but we can help you tell the story supported with facts. When freight cost refunds start coming in, everyone will know it was worth the time invested.
So this spring, think about how AMTR can help your company “clean up” your freight cost problems—we are ready to help you change the status quo for the better!
The city of New Orleans is seeking a private operator to purchase the NOPB Railroad in order to provide help with capital improvements and maintenance costs. According to New Orleans officials, it is hoped that the new agency will help improve commerce, as well as “maintain a competitive rate structure” to attract new customers. The NOPB connects with all six Class I railroads and provides switching and haulage service. An estimated one-third of all east-west rail traffic crosses the Huey P. Long Bridge segment of the railroad. The selection process is expected to be finalized by summer, and therefore all shippers who utilize this short line should be vigilant in getting ahead of any tariff or rules updates.
Increased Rates Likely
Many larger less-than-truckload (LTL) carriers emerged from 2016 with much lower profit margins than anticipated. However, things are looking up in 2017. As of February, LTL volume has grown to the point that carriers are confident that rates may be raised soon.
A recent joint survey by NASSTRAC, Journal of Commerce and Truckstop.com found that less than half of the 14,000 shippers and brokers surveyed anticipate only a slight rate increase. Some 14 percent of those surveyed expect rates to drop. Logistics Management forecasts a 2% increase in LTL pricing; however, several LTL carriers have published a 4.9% rate increase to encourage growth. As rates increase, AMTR’s ‘Smart’ Auditors can help you to ensure that you are not overpaying.
