Fleet Management News & Business Info | Commercial Carrier Journal
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INNOVATORS PRICE-TRAN Claysburg, Pa. up to be a "volume" LTL carrier to compete with "legacy" LTL carri- ers in price and service. For simplicity, Price-Tran does not have tariffs; its system is based exclusively on pallet pricing. "It's really about selling space in a trailer, model as an analogy. Airlines do not care who occupies a seat, how tall they are or how much they weigh. "They charge what they charge per seat space, " Pallet pricing is not a unique offering. Other LTL carriers offer similar programs, but Ward says the key difference is that Price- Tran places no restrictions on the Pallet pricing D weight, height, length or freight classifi- cation of pallets. Price-Tran develops business model to make LTL rates more simple, affordable BY AARON HUFF eregulation of the trucking industry more than 30 years ago did noth- ing to simplify the rate structure of less-than-truckload carriers. If any- thing, LTL tariffs have become more complex. Every carrier has unique tariffs that involve a complicated freight classification sys- tem, ZIP code pairs and price breaks – called discounts – for weight, miles, linear feet and other items. On top of this, carriers add on fuel and other accessorial charges. Carriers and shippers are able to manage this complexity with technology. Many shippers use transportation management software to dissect LTL tariffs and compare apples to apples for freight bids. Dave Ward dealt with the complexity of tariffs for 28 years as chief executive officer of Ward Trucking in Altoona, Pa., and then as a transportation consultant. In 2010, he launched a new transportation company dedicated to making LTL shipping simpler and more affordable for customers. "We thought there was a bet- Launched a new 'volume LTL' company and created a simple pricing program to eliminate the cost and complexity of LTL tariffs. ter way to do this," says Ward, who along with his wife, Liz, and two outside investors opened Price-Tran in March 2011. Price-Tran was designed and built from the ground Filling a niche Price-Tran focuses on shippers with freight conducive to pallet pricing. Cus- tomers that fit this mold have shipment sizes of six to eight pallets or "skids" – about three times the pallet count of an average LTL shipment. For this niche market, Price-Tran has about half of the prospective business of an LTL carrier, but it claims a competi- tive advantage in price. The company can save shippers at least 15 percent on transportation costs, Ward says. Unlike Price-Tran's model, LTL carri- ers typically charge extra for pallets that weigh 1,500 pounds or more. They also may charge more for a 300-pound pallet depending on freight classification or the cubic dimension, he says. Some LTL carriers will weigh and inspect freight consistently as it moves through their systems to upcharge ship- COMMERCIAL CARRIER JOURNAL | JULY 2012 55 " he says, offering the airline " Ward says. "We're doing the same thing charging by pallet space.