Right size your fleet to help control demurrage charges!

Did you know that you could get control of your demurrage costs in two steps? First step: Right-size your fleet If you own or lease your equipment, it is important to understand how many railcars you need to ensure that you deliver your product to your customers on time.  Many rail shippers lean towards increasing […]

Have the Railroads Stopped Negotiating?

Are the railroads telling you that privately negotiated contract rates are reverting to public tariffs? This may become more prevalent, but that does not mean the railroads have stopped negotiating. Public tariffs have long been in existence, providing easy access to rates with low administrative costs. But over the years, many shippers have been successful […]

Selecting a Rail Transload Facility

Rail transload facilities play a vital role in many companies’ shipping networks. These facilities allow shippers to realize benefits from a combination of rail and truck. Perhaps you’ve used the same transload facilities for some time, and you’re wondering about other opportunities. Or perhaps you’re reassessing your shipping plan to accommodate new receivers, new products, […]

Rule 11 Railroad Rates Benefit Shippers

Are the railroads telling you they want Through Rates converted to Rule 11? If so, that’s a good thing. A Through Rate is one rate that covers all railroads in a multi-railroad shipment. For example, moving from the west coast to the east, you’d pay one rate to the origin carrier, who is then responsible […]

Effective Rail Rate Negotiations

Understanding how the railroads price your commodity is a starting point for determining your ability to negotiate rail freight rates. Railroad pricing has been cyclical over the years, fluctuating between public tariffs and private contracts. With the use of differential pricing, the railroads may provide different rates to different shippers in similar lanes. Regardless of […]

How Railroads Price

How Railroads Price

Railroads will tell you they “price to the market.” But, whose market is it, yours or theirs? The Revenue-to-Variable Cost Ratio (RVC) is an important metric for understanding how the railroads compare any given rate to another, and consequently how they price. The RVC is simply the rail rate divided by the railroad’s operating cost. […]

Reduce rail transportation costs

8 Strategies to Reduce Rail Transportation Costs

The railroad barons who oversaw the railroad industry in the late 19th and early 20th centuries understood the importance of controlling geography and the industries within it. This highly competitive group also realized that they had to look outside their own defined markets to enhance their, and their customers’, growth. The only way to accomplish […]

Rail Rate Tariff Renewals

As the last month of Quarter 3 closes in, railroad freight rates have continued to take increases.  Listed below are some rate authorities that are renewing in the next couple of months. Tariff Updates Rate Authority Commodity Expected Increase Effective Date CN 4080  Soybean Meal and Products ~5% 9/1/2017 CSXT 2061 Molasses ~2% 9/1/2017 CSXT 29116 Asphalt […]

Should You Bundle Your Moves When Negotiating Rail Rates?

Being strategic with your rail rate negotiations means establishing goals for your current and future contracts, clarifying each party’s values, and challenging the ground rules. Although you should always negotiate with your entire rail transportation portfolio in mind, this does not mean that it is always best to bundle your rates when negotiating. Shippers often […]