How to Price Intermodal Freight
The first and last mile of an intermodal container move are essential in getting freight where it needs to go. This is where trucks get involved, and a drayage trucking carrier is either dropping off or picking up a container to start or finish the trip. When it comes to pricing a full intermodal trip with multiple modes of transportation, it can greatly differ with each leg of the trip. The price for a rail shipment is typically decided by the rail company that offers standard rates. When it comes to pricing for the drayage portion of an intermodal trip, it’s up to the customer and will vary with each intermodal load.
The key for intermodal marketing companies (IMCs) when pricing the first and last mile of an intermodal trip is to figure out what drayage carriers would consider a competitive rate. Carriers are looking at the relationship between the price of the freight and the total mileage, so any pricing decision should reflect that. As diesel prices remain very high, intermodal trucking carriers are looking for rates that are acknowledging the current situation and allow them to continue making money on the road.
Time and the type of load are also factors in how a price should be calculated for a trip. Carriers will generally accept lower prices for drop & hooks since those come with wider appointment windows and less time spent at the warehouse. On the other hand, a live load or unload will call for higher prices since the carrier needs to show up at harder appointment times and spend time waiting for freight to get loaded or unloaded.
Here at DrayNow, we offer many data sets that can help IMC customers follow trends in freight pricing. Our monthly spot rate updates, found on the blog, break down the trends seen with average spot rates in our core markets. The Intermodal Spot Rate Tracker and the Drayage Volatility Index show average spot rates across the platform plus the year-over-year changes in the cost to move freight.
To get capacity for intermodal freight outside of their traditional carrier network, IMCs can post trips to the DrayNow marketplace. The rate they would use for a carrier within their own network is a starting point when pricing freight on the platform. An indicator of how a load is performing is how long it has been on the marketplace. If it’s been 15-30 minutes and no carrier has requested the load, this is the perfect opportunity to up the price and get that capacity quicker.
Before even posting a load to the DrayNow platform, customers can get pricing feedback tied to current marketplace conditions. Our pricing tool is available when building an order, letting users know whether the price of their intermodal freight will be competitive in comparison to the rest of the market. This tool factors every detail of the intermodal drayage load into the calculation, saving time and guesswork in considering competitive rates.
There are many intricacies to an intermodal freight move that can make pricing a complex process. Once you consider what carriers are looking at when deciding on a load, and use technology solutions like DrayNow, that process becomes a lot easier.
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