First, Understand How Your Transporters Charge You

Before you negotiate with your transporter, you need to know how your transporters rate their charges. Here are the following consideration your transporter normally takes to rate your transport charges:-

1. Distance - the further the destination point from the pick up point, the higher the transport rate, or vice versa.


2. Volume - the more volume you have per delivery, the cheaper it is per unit goods
   
3. Weight - the heavier your products, the higher the transport rate or vice versa


4. Size - the bigger your products, the higher the transport rate or vice versa


5. Frequency - the more frequent the delivery order, the better transport rate you can get.


6. Value of products - the more valuable your products are, the higher the rate you'll get or vice versa (it usually applies to consolidated items).

These are the basic things you need to bare in mind before you negotiate with your transporter with better rate. So read on for further tips.

How to Choose a Good Transporter?

OK. How do you look for good transporter? Immediately, I would recommend my own company to you.. haha. Anyhow, you also need to do your due diligence to ensure that your transporter can fulfill the following 6 criteria:

1. Rate, of course: Sometimes if the rate is slightly higher than other, it's recommended to give it a try too, maybe that transporter can give much more valuable services to you
2. Company history: For safety purpose, is your transporter long enough in the market? Will they be the problem run-away type? Is it safe to let them handle your delivery? If one company is in the market for more than 30 years, you can rest assure that they must have done something right to be in the market for so long.
3. Facilities: Do they own their fleet of lorries or they just rely on outsourcing transporter? If they outsource to others, normally the rate is higher due to certain mark-up for their margin and in addition, they have lesser control on the lorries. Furthermore, the outsourcing transporter will normally not put your delivery in their priority because they have their first hand customers to deal with too. When it comes to peak season, your delivery will be at risk for delay.
4. Goods Collection: Do your transporters do door-to-door service? If yes, do they normally come to pick up your goods on time? If the transporter always come in late to collect your goods, say after your working hour, that will incur OT cost for your company. So you need to rate your transporter whether they will collect your goods early.
5. Prompt Statement: How fast your transporter can return the stamp-signed copy of your DO? Because that will affect your own payment collection too. The faster you receive your statment, the faster you can get your money from your customers. So, the transporters have played a major role in here.
6. Management: Are your transport closely monitor your delivery? Do they communicate or respond to you promptly? Are they good at solving your problem?

If your transporter fulfill the above basic criteria, keep them and work with them. Otherwise, it's time to look for other transporter.

Picking the Right Truck Saves Money

If you have stackable items (usually light weight items) and you are going to charter one full truck, lorry or trailer, make sure they ask for the canvas type as shown below:

The advantage of canvas truck is that the height of the cargo can be adjusted flexibly. You can easily ask the transporter to raise another foot up. Let me show you a simple calculation:

Normally lorry, truck or trailer comes with 20ft, 30ft and 40ft with the width of 7.8ft. Say, simply ask the transporter to stack another foot high, you can earn an extra 156 c.f., 234c.f., and 312c.f., respectively, without extra charge. That is also equivalent to roughly RM90, RM140 and RM180 worth of space, respectively.

Want to save cost? Just Ask

The most powerful way of all time to get what you want is “just ASK”. No matter what rate you are getting from your transporter, don’t forget to ask for a lower rate (read on the following articles on how to negotiate for lower rate), most of the time, you’ll get it unless your transporter has given you the best rate already. Also, try to ask if they can do a pick up for you if possible. You’ll be surprised, for them to pick up the goods from your place is just a few ringgit extra which will save your time, petrol cost and perhaps, toll as well.

Cash Payment can Save Money

If you do not have the volume and do not even have frequent order from outstation clients, the only way you can negotiate for better rate is to pay by CASH. By paying cash, you can easily ask for 10% - 20% discount. If the delivery does not involve too much money, just pay lower rate by cash.

So, one thing always hold true in business world - CASH IS KING

Weight can save money

As mention earlier, the heavier the product, the higher the transport rate, or vice versa. If your products are somewhat heavy, such as steel coils, fertilizers, chemicals etc, make sure you inquire the transportation rate based on weight or normally referred as tonnage. It normally comes with cheaper rate compares to the rate by loose package. If you can palletize your products (normally 1-ton per pallet), the rate is even more cheaper.

Volume/Quantity saves money

Needless to say, when you have the big volume, such as one full load for one drop off point, the negotiation power is always there because this is the most ideal case for transporters.


There are a few possibilities you can get a better transport rate:

1. Check the rate by the total tonnage of your delivery compares to chartering one full lorry
2. Check the rate by the total quantity of your delivery compares to chartering one full lorry

Normally, the rate for chartering one full lorry is always cheaper. Well, don't take my word, always check first.

Frequency can save money

Even if you don't have big volume/quantity, you still can get a slightly cheaper rate by letting your transporter know the frequency of your delivery. The more frequent your delivery in a week or a month, the better rate you can enquire from your transporter. At the end of the day, it's still up to you whether you want to take the trouble to negotiate RM1 or RM2 cheaper per carton.

Don't look down on the RM1 or RM2 discount, as Malay saying, "sedikit sedikit, lama lama jadi bukit"

Always Good to have a Secondary Transporter

It is always recommended to yourself a back-up or secondary transporters in case your existing transporters cannot cope with the job load, especially during peak period such as festive seasons. When it comes to this scenario, you can immediately call your secondary transporter to back you up. Any adhoc search for back-up transporter will always cost you money.

Keeping a secondary transporter allow you more time and options to test out which transporter can give you better service at the better rate. For instance, we were the secondary transporter for some companies initially, and we slowly work our way up to become their primary transporter with our consistent quality services.

After you have confirmed your secondary transporter, make sure you know how to keep them by having them deliver your goods on and off. This also allows your secondary transporter to familiarize with your and your customers' loading/unloading procedure, when it comes to emergency, your secondary transporter can easily cope with the delivery.