ArcBest announced it will apply space-based cubic minimum charges for less-than-truckload shipments, effective Aug. 1.
The Arkansas-based company, parent of ABF Freight and Panther Premium Logistics, said the minimum charges better reflect recent freight shipping trends, including the growth and shift toward bulkier shipments across the supply chain. Many shipping and logistics solutions also now include unique requirements, according to ArcBest.
“The logistics industry continues to change rapidly,” said Judy McReynolds, ArcBest chairman, president, and CEO. “We believe this initiative is the natural step for us to take now to ensure that the value we provide is appropriately reflected in the compensation we receive for our shipping and logistics services. We view this as a logical complement to the current weight-based pricing common in the LTL industry.”
Because of the rise of internet-based commerce, light weight but bulky shipments are becoming more common for carriers. These shipments take up a lot of space but don’t weigh much, which is increasing the handling costs of the shipments for LTL carriers like ArcBest, according to a Journal of Commerce report.
Delivery companies such as UPS and FedEx have already implemented space-based charges for packages, increasing the price of bulky and lightweight freight. While this could increase costs for shippers, it may also encourage smarter packaging.
A new process will require customers to provide freight dimensions or have ArcBest calculate it for them, to determine applicable cubic minimum charges that will supplement weight-based metrics when appropriate. ArcBest already has dimensional data on more than 90% of the freight shipped through its asset-based network, according to the company.
To further capture shipment dimensions and validate shipment dimensions provided by customers, ArcBest will install static dimensioners at the majority of its distribution centers, expected to be in place by Aug. 1.