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Do You Know How CMC is Affecting Your LTL Rates?

posted in Less Than Truckload by

For convenience and cost, LTL shipping is a common option for businesses who want to get their product from Point A to Point B safely without paying full truckload rates. Unfortunately, a new shipping surcharge could be raising your rates without your knowledge. If you’re shipping LTL, do you know how CMC is affecting your rates? Keep reading to find out.

CMC charge for LTL

Cubic Minimum Capacity, the New LTL Surcharge

The whole point of LTL freight shipping is to cut down on costs. By bundling multiple LTL shipments into one full truck freight, businesses receive the associated savings. But when carriers add on extraneous charges, like the new CMC, the savings start to dwindle. So what is CMC?

Cubic Minimum Capacity or CMC is a relatively new surcharge added to freight shipments that go beyond what a shipping carrier deems typical in size. Generally, if your LTL shipment is over 750 cubic feet with a density of less than six pounds per cubic foot, then your shipment could be hit with a CMC charge according to the CMC rules already in place among several carriers.

Because of this, it’s important for shippers to understand how they can save money by avoiding the CMC charge altogether, and thus skirting the new CMC rules. But first, here’s how cubic capacity is calculated:

Cubic Capacity is calculated with a simple formula of height x width x length. This will give you a cubic feet measurement.

How to Avoid the CMC Rule Charges

The best way to avoid getting hit with a CMC charge is to follow the points below:

  • Choose your carrier wisely. Before shipping with a specific carrier, check their LTL terms and conditions carefully. Do they charge a CMC fee and at what point is the fee imposed? If you’re not sure whether you were charged for a past shipment, check out the bill of lading or BOL.
  • Know the rules before you ship. If you know a specific carrier is imposing the CMC rule, you can make sure in advance that your shipments are under 750 cubic feet and that the density is within the requirements.
  • Try to keep shipments compact. While it’s not always possible, most carriers charge a CMC if a shipment is longer than 12 linear feet. In fact, if you’ve ever seen an “extreme length fee” on your BOL, this is what caused it. If at all possible, try to keep your LTL shipments compact to avoid the surcharge.
  • Work with a 3PL. If you want to keep LTL freight costs as low as possible, working with a third party logistics company or 3PL may be the optimal way. 3PLs work with carriers to negotiate the lowest rates for their clients, negotiating items like CMC in advance.

Learn More About Amware

To keep your shipping costs low, be sure you know exactly where your charges are coming from. Then, work with a company who can negotiate the best LTL rates so you don’t have to. Want to learn how to integrate your shipping process? Contact the team at Amware now, or download a free 30-day trial of Amrate, Amware’s premier LTL software platform.

 

Amrate 30-day free trial

31 May, 18

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