The Case for Lowering LTL Limits of Liability

It’s no secret that carriers are quickly firing 3PLs that aren’t seen as strategic partners. Every 3PL should be actively searching for creative ways to make themselves standout as truly strategic and collaborative partners to LTL carriers.

The reality is that LTL’s closed-market nature has created a rigid dichotomy between the Haves and the Have-Nots, with many 3PLs left without access to LTL capacity. 3PLs successful in standing out among their peers will soon enjoy higher margins and more capacity security.

In light of these circumstances, one must wonder why more 3PLs aren’t actively working with carriers to identify their biggest pain points and find better alternative solutions. The secret to stronger relationships is hidden in ideas such as lowering carriers’ limits of liability, moving to density-based pricing or embracing rate optimization through dynamic pricing (via API).

The simplest opportunity for 3PLs to break into the Haves’ group and strategically align themselves with carriers is to suggest lowering carrier limits of liability. The amount of economic waste created by the system currently employed by the LTL industry is astounding when compared to how LTL carriers operate.