Rygen Technologies is a premier supply chain technology provider, that enables any company to quickly, easily, and efficiently execute and manage freight, connect with partners, and unlock data insights for their supply chain. With emphasis on advanced technology and exceptional customer service, Rygen is fueling the creation of smarter, data-driven solutions that deliver real value and solve real business problems.
Did you know the first canned beer went on sale in 1935? That same year, the world’s first parking meter was installed. To top it all off, Amelia Earhart became the first person to fly solo from Hawaii to California. That’s a lot of “firsts.” It was also a big year for supply chains as the National Motor Freight Classification (NMFC) was established.
The NMFC is a standard for less-than-truckload (LTL) rates and happens to be used for LTL pricing to this day. A number between 5 and 500 is assigned to each commodity, for example, car accessories are Class 60 while car parts are Class 65. It can be easy to classify freight incorrectly and the consequences can include delays, unanticipated fees, and incorrect invoices.
It’s surprising that the NMFC remains the standard for pricing LTL freight, especially since it was only available in print until 2006. While technology can’t change the rules, the right tech solution can help supply chain managers avoid complex systems and manage LTL pricing faster, more easily, and with greater accuracy.
A modern Transportation Management System (TMS) can easily automate freight classification providing shippers with a clear view of expected rates when selecting carriers. With pre-billing capabilities, shippers can efficiently validate transportation charges before invoicing. A modern TMS is also able to catch errors of all kinds — including freight classifications — minimizing manual corrections, disputes, and delayed payments.
Along with this, TMSs can be used to automatically audit invoices, avoiding any unexpected charges, such as a commodity being reclassified by the carrier resulting in a rate increase. Automated communication with carriers and document creation also reduces the time needed to award freight.
Freight classification is definitely not one of the most interesting aspects of transportation, but it is just one of the many processes a TMS can help shippers complete quicker and more efficiently. The time saved can be used for shippers to focus on strategy and performance. And with even one freight miscalculation directly impacting transportation costs, an advanced TMS will deliver Return on Investment (ROI) faster than reading the rules of classification for even one commodity.
Freight classification may not be the most exciting aspect of transportation, but it’s one of the many processes a TMS can help shippers complete more quickly and efficiently. The time saved allows shippers to focus their time on business strategy and performance. With even a single freight miscalculation impacting transportation costs, an advanced TMS can deliver a faster return on investment (ROI) than reading the rules of classification for just one commodity.
Although the NMFC is an older process, adopting newer, more modern technology can make supply chain managers’ lives a lot easier.
