Find out how to reduce freight costs through a proven approach-from selective mode to cost-per-pound pricing, peer benchmarking, and carrier contract negotiation-guaranteed to increase your bottom line.
Stop Overpaying for Freight
Carriers routinely dictate pricing terms, so most shippers are paying more and don’t even know it. If you’re in charge of freight cost management, you know what it’s like to be locked into carrier pricing programs and subjected to ever-increasing fees—from fuel to accessorials and complex tariff rules.
But it doesn’t have to be that way. At CPC we approach transportation cost savings using kaizen, a Japanese methodology focused on continuous, incremental improvement, applied via tactics such as freight optimization, simplified pricing structures, and competitive negotiation to secure more favorable carrier contracts.
22%
average net savings for our clients
With our innovative pricing model, peer and industry benchmarking, and carrier contract restructuring
Freight cost reduction is the process of identifying and eliminating inefficiencies across a transportation program. The most effective ways to reduce freight costs include optimizing mode usage, benchmarking rates, simplifying pricing structures, and negotiating carrier contracts.
Do you have the correct number of carriers in your network? Are you leveraging the total spend, or are you diluting the opportunity for carrier-preferred status? Balancing risk and savings is the output of this step.
Assess mode selection
Are you using the correct modes? Weight, load size, haul length, and service level determine the most cost-effective mode.
Align carrier type to mode
Are you using the right type of carriers in the mode? Aligning shorthaul shipments with regional carriers and long-haul with national carriers ensures you have the optimal carrier for the load. Choosing the wrong type of carrier can lead to delays and unnecessary costs.
Compare rates to the market
Are you paying market rates? Almost every shipper lacks insight into market rates. CPC has a rate library to compare your current spend against peer shippers. This creates a competitive advantage when negotiating contracts with carriers.
Benchmark accessorial and fuel costs
Are you paying market-competitive accessorial charges and fuel costs? Benchmarking helps identify unnecessary accessorial and fuel charges.
CPC's Innovative Freight Pricing Model
Class-based pricing, the freight cost model in use today, originated in 1933 when the transportation industry was first regulated and pricing structures were implemented to protect U.S. carriers. It is a multidimensional and overly complex system.
Cost-per-pound pricing is a simplified freight model based on weight and distance rather than classification. CPC Consultants uses this approach to reduce freight costs and eliminate pricing complexity.
TraditionalComplex, class-based pricing
CPC ConsultantsSimple, cost-per-pound pricing
Every product grouping (e.g., machinery, medical supplies, ping-pong balls) is
assigned a class based on
product density, stowability in a trailer, and cargo value.
Every product gets a cost-per-pound pricing assessment—regardless of its value, density, or space
needed in a trailer.
The higher the class, the more expensive the shipment.
No classification means no arbitrary increase in expense.
A multidimensional pricing structure determines the base freight cost. Each classification has a separate
base rate scale. Weight per shipment is broken into weight breaks (e.g., 0-500, 501-1000, 1001-2500). Distance
is determined by ZIP code origin to ZIP code destination.
Pricing is calculated based on state-to-state movement as a simple cost per pound. There are no adjustments
based on classification because class-based pricing doesn't apply.
Accessorial charges are added separately and in addition to the minimum charge.
All charges, such as fuel and liftgate, are included in the base rate, eliminating accessorial charges and
reducing overall freight cost.
ExampleLet's say you have a 500-pound shipment of down feathers. Under the class-based pricing
system, the shipment of feathers will be significantly more expensive than a 500-pound iron anvil because
the anvil takes up less trailer space.
ExampleUnder
cost-per-pound pricing, the shipping rate for feathers is based on 500 pounds vs. how much space they take
up in the trailer. The base rate includes fuel and accessorials, resulting in lower overall and cost per
pound—for feathers and anvil.
Reduce freight costs faster with CPC’s direct access to top carriers and tailored cost-per-pound solutions.
Incorrect mode usage is one of the most common causes of high freight costs. Aligning size and weight to mode reduces freight costs and improves service. It’s important to review legacy mode choices and ensure the correct mode is selected based on shipment weight, density and distance rather than habit.
Here are examples of common misrouting:
Shipping heavy packages using parcel – Less-than-a-truckload (LTL) will avoid unnecessary accessorial charges for oversized or overweight shipments with a parcel carrier.
Shipping too many pallets with an LTL carrier – A general rule of thumb is that 50% of visible trailer capacity is the cutoff between LTL and full truckload.
Using expedited air freight – Short distances can be covered in the same time as expedited air freight.
Using multi-weight pricing can save you money when sending multiple small shipments to a single address. So can consolidating packages into a single-weight shipment instead of being charged per shipment.
How to Get Competitive Market Rates
As a shipper, you don’t have visibility into what others pay. Freight rates vary based on cargo characteristics, volume, lanes, distance, mode usage, carrier network, and routing strategy. While the carriers you work with set pricing, they’re not offering benchmarked rates designed to reduce your freight costs. Your best bet is hiring a specialist with years of market insight and analysis expertise who can:
Conduct freight assessments and transportation cost analysis to identify which shipping lanes are higher than industry benchmarks
Benchmark freight bills against a rate library or peer shipping data to better align current pricing with the market.
Execute selective competitive bidding and conduct regular contract reviews for favorable terms, rebidding when market conditions are right and holding when they're not.
CPC monitors market conditions to guide the right course of action.
Continuous monitoring. Continuous improvement.
CPC tracks mode usage, identifies cost shifts, and stays ahead of inefficiencies with ongoing oversight and monthly performance reporting.
Freight contracts don't stay competitive on their own. Rates, fuel programs, and accessorial terms shift with the market, so a contract signed two or three years ago is often quietly out of date. Reviewing agreements on a regular cadence — not just when service breaks down — keeps pricing aligned with current conditions instead of legacy terms.
Accessorial Charges
The accessorial portion of a freight bill can be as high as 50% for top LTL carriers. Extra charges for liftgate, fuel, inside delivery, detention, and more get added to the freight bill—making it feel like it’s a normal part of doing business. Yet accessorial charges are the biggest hidden drivers of freight cost, making it harder to identify your true total cost. In reality, many of these charges are avoidable with the right pricing structure and strategy.
CPC’s all-inclusive approach eliminates the extra charges and provides full visibility to the total logistics cost.
Negotiate Carrier Rates
While most shippers negotiate once every three years, carriers negotiate daily and have seen it all, so they outmatch the shipper every time.
To reduce freight costs, you need to create a competitive environment, negotiate better rates, and apply proven cost-optimization strategies. Show your carriers how and why, and they’ll be more inclined to work with you to lower your rates while maintaining their own acceptable margins.
Here are some good reasons to negotiate carrier rates:
Freight contracts vary widely across carriers. This can lead to overpayment due to inconsistent pricing structures.
Fuel surcharge programs differ by carrier. This can create opportunities to reduce costs that are above market rates.
Tariff discounts vary by lane and region. Renegotiating can better align pricing with your actual shipping patterns.
Heavy reliance on national carriers can increase costs. Evaluating your network may reveal that regional carriers exist to drive savings and better service.
Outdated contracts lock in outdated pricing. Regular renegotiation ensures rates stay favorable to the shipper.
Most shippers are too busy to regularly evaluate their carrier contracts but many opportunities exist to identify inefficiencies that lead to overpaying.
CPC’s all-inclusive approach eliminates extra charges and provides full visibility to the total logistics cost.
CPC in Action
Freight Cost Reduction Results
Here are examples of how CPC helps reduce freight costs for our clients. Get a freight evaluation to see how we can help you shave shipping costs.
30% cost reduction + $11.2M savings in LTL freight
A leading consumer HVAC manufacturer reduced LTL costs after CPC identified pricing inefficiencies and implemented a structured, benchmark-driven carrier selection process.
A global manufacturer of PPE centralized its transportation strategy. CPC reduced its carrier base from 82 to 9, improving efficiency and exceeding savings targets by 132% within one year.
50% cost reduction in reverse logistics operations
A telecommunications provider reduced costs after CPC redesigned its return process, aligning transportation methods with service requirements and improving asset recovery.
CPC Consultants stands with shippers. That’s because we were shippers once ourselves, so we understand the challenges. We’re also independent, so we’re not beholden to any specific carrier relationship. Find out more about CPC for reducing freight costs.
“CPC Consultants became a trusted partner, supporting us at every stage of our growth. Their solutions reduced costs by over 20% while improving transit times and increasing throughput by 10X. CPC was instrumental, providing strategic direction that enabled us to maintain a competitive advantage from launch till our recent acquisition by Nordstrom.”
“Even one year after the project, and over one million dollars in savings, I still receive kudos from upper management. CPC makes me look good.”
“Throughout my tenure in this role, I thought I had exhausted all avenues to save on transportation expenses—that was until I encountered CPC Consultants. Brace yourself for the astounding outcome: They saved us a staggering $1.2M (30%) in freight costs over a 12-month period.”
“We approached CPC Consultants, asking them to gather competitive intelligence and conduct a benchmark study within an extremely tight timeline. CPC’s team of experts was able to quickly execute and deliver on time and on budget.”
Frequently Asked Questions About Reducing Freight Costs
Yes. Reducing freight costs does not mean compromising carrier quality. It means optimizing how your transportation program is structured. By aligning the right carriers to the right lanes, improving mode selection, and benchmarking rates against the market, shippers can reduce costs while maintaining or even improving service performance. In many cases, cost reduction comes from eliminating inefficiencies rather than changing service standards.
Not necessarily. In some cases, optimizing freight costs may involve adjusting your carrier mix—by introducing regional carriers or reducing redundancy, for example—but it doesn’t always require replacing existing partners. The goal is to ensure each carrier is used where it performs best and offers competitive rates. CPC often finds that better alignment and negotiation within an existing network can deliver meaningful savings without a complete overhaul.
Yes. Many accessorial fees, such as liftgate, inside delivery, and fuel surcharges, are not fixed and can often be reduced or eliminated with the right approach. These charges are frequently built into traditional pricing structures and may go unchallenged. Through benchmarking, contract negotiation, and simplified pricing models like the cost-per-pound method used by CPC, shippers can gain better visibility into these fees and significantly reduce their impact on total freight cost.
