Freight refers to the goods or cargo that are transported from one location to another. It involves the movement of goods through various transportation modes such as trucks, ships, airplanes, and trains.
Freight plays a crucial role in the supply chain and is an essential component of the logistics industry.
Freight Types:
Full Truck Load (FTL): This refers to a shipment that occupies the entire capacity of a truck trailer (Know more about the full truck load for better insight)
Less Than Truck Load (LTL): It involves the transportation of smaller shipments that do not require a full truckload (Know more about less than truck load for better insight)
Air Freight: The transportation of goods via airplanes, which offers fast delivery for time-sensitive shipments.
Ocean Freight: Transportation of goods through cargo ships, commonly used for international shipping.
Rail Freight: The movement of goods via trains, often used for long-distance transportation of bulk commodities.
Freight Rates:
Freight rates are the charges applied for transporting goods from one location to another. They can vary based on factors such as distance, weight, volume, transportation mode, and market conditions.
Freight rates are typically negotiated between the shipper and the carrier, or they can be standardized for certain routes.
Refer the different truck rates for more details.
Example:
“Imagine a manufacturing company based in Chicago that produces electronic goods. They have just received a large order from a retailer in Los Angeles. To fulfill the order, the manufacturing company needs to transport their products from their warehouse in Chicago to the retailer’s distribution center in Los Angeles.
They engage a freight forwarding company to handle the logistics of the shipment. The freight forwarding company arranges for a truck to pick up the goods from the manufacturing company’s warehouse and transport them to the destination.
The truck, loaded with the electronic goods, begins its journey, crossing several states and covering a distance of over 2,000 miles. During transportation, the freight is tracked using GPS technology, providing real-time updates to both the manufacturing company and the retailer.
After a few days, the truck arrives at the retailer’s distribution center in Los Angeles, and the goods are unloaded and checked for quality. The successful transportation of the freight allows the manufacturing company to meet the retailer’s demand and ensures a smooth supply chain operation.”
In this example, the freight refers to the electronic goods being transported from the manufacturing company’s warehouse in Chicago to the retailer’s distribution center in Los Angeles.
The logistics company manages the transportation process, utilizing a truck for the shipment and employing tracking technology to monitor the freight’s movement.
FAQs:
- What do freight rates mean?
Freight rates are charges applied for transporting goods from one location to another.
- What are the other words used to describe freight?
Cargo, shipment, goods, load, consignment, haul, freightage, and merchandise.
- What are the factors that influence freight costs?
The freight cost is based on factors such as distance, weight, volume, transportation mode, and market conditions