Trucking: reclassification of freight, nmfc classification, ltl transportation

Question
QUESTION: Hi Jim,

I would like to ask you a question regarding re-classification of LTL freight (according to NMFC guidelines) by 3PL/trucking companies.

1) Do 3PL's check the correctness of the NMFC clasification # for ALL shipments they recieve from the shipper ?

2) Even if it is done randomly, how is the re-checking process done ? Is the packaging opened to check whether the item mentioned on the BOL is physically the same ? Are dimensional weights done ? Etc.

I am asking this quesion from a business process point of view

Thanks and Regards,
Pradeep

ANSWER: Pradeep, I have not seen this as a process at a 3PL.
First let me clarify that the NMFC classification is used in the US domestic and US-Canada LTL transportation sector.   Typically the NMFC classification is determined by the manufacturer or shipper up front and then they link the NMFC to the SKU in their database so that the the correct classification will flow from order to shipping documents.  If this has not already been done a qualified consultant can assist.  
Most LTL carriers will also assist as it's in heir interest to have correct information for load planning, billing, rating and costing purposes.  Some 3PL's may also provide this type of consultation but it is highly specialized and not always done correctly.
The opening and inspecting of packages is done on a limited basis by the LTL carrier not the 3PL.
Active freight inspection programs are typically run by the LTL carriers as part of their process because they often receive Bills of Lading with inaccurate or incomplete descriptions and weights.  This results in corrected billing and additional administrative work for the carriers and the shipper. If it is not corrected by the shipper it adds cost to their supply chain.
Do you have a copy of the NMFC?  You can get one as well as complete info on how classifications are determined from NMFTA. http://www.nmfta.org/Pages/welcome.aspx
If you are working with a limited number of products I may be able to help you.  If you have a major classification project I can recommend a consultant.
Hope this helps.
Jim

---------- FOLLOW-UP ----------

QUESTION: Thanks a lot Jim for your answer. If I may ask you as a followup, in your experience, approximately what percentage of total LTL shipments recieved from the shipper have classification errors ?

Answer
Pradeep, there are a couple of different types of errors and I don't have any real current direct evidence, but my sense is that historically across all industries you would see about 50% accurate, clear and complete product descriptions on the bill of lading.  There is probably 10% to 15% that are blatant misdescriptions in an attempt to get lower freight charges through deception or fraud.  Most will get caught eventually but they then just shift to another carrier until they get caught again.  Some are even coached by the carrier representative as a way to take business from a competitor.  Then there is another 25% to 40% that just don't know and so they use incomplete descriptions or trade names and leave it up to the carrier to figure out.  That is not a good scenario either because different carriers may interpret differently and the shipper could pay more than is correct.
It all xcomes down to the shipper knowing exactly how to describe and classify their freight on the bill of lading before they ship.
Jim