Are rising freight costs cutting into your bottom line? Reducing freight fees without compromising on service is essential for your business’s cost efficiency. But, it’s easier said than done.
In this guide, we’ll provide you with actionable strategies that any business can use to secure better rates and lower expenses without sacrificing service quality.
Before we dive into the details, here are the most effective strategies for how to reduce freight costs in 2025:
- Conduct regular freight audits to catch billing errors.
- Leverage predictive data in carrier negotiations.
- Consolidate smaller shipments into fewer, larger loads.
- Use AI-powered tools to optimize shipping routes dynamically.
- Implement a modern Transportation Management System (TMS).
- Analyze and manage complex fuel surcharges.
Key Takeaways
Regular freight audits are essential for uncovering billing discrepancies and maximizing cost efficiency in shipping operations.
Building strong relationships with carriers and utilizing data-driven negotiations can significantly lower freight rates and improve service reliability.
Consolidating shipments, optimizing packaging, and implementing effective load planning enhance shipping efficiency, reduce transportation costs, and improve overall logistics operations.
Foundational Strategies:
Audits, Relationships, and Data
Conduct Regular Freight Audits
Regular freight audits are one of the best ways to keep freight shipping costs under control and find ways to improve your logistics. They offer insight into your costs, spending, and shipping needs, which you can use to forecast your costs more accurately and ensure you get the best rates.
By reviewing freight invoices against your carrier agreements, you’ll also catch billing errors like duplicate charges, incorrect rates, or unauthorized fees. This not only prevents overpayment but also ensures you’re only paying for services you’ve actually received.
You can even automate the freight audit process with auditing tools, cutting the time it takes to find and resolve billing errors by 60% or more. That way, your team can focus on other critical tasks to help keep your supply chain flowing.
Build Strong Carrier Relationships
Your relationships with carriers play a huge role in your overall shipping efficiency – both financially and functionally. They control your costs and determine what services, like special handling or priority shipping options, you can use. Plus, their reliability directly affects whether your customers get their packages on time.
If you want the cost-efficiency, reliability, and flexibility that are required for an effective shipping process, you need to build strong relationships with your freight carriers.
You should:
Maintain Transparent Communication: Be upfront about your shipping needs, forecasts, and changes. Clear communication helps carriers plan better and offer competitive rates.
Provide Feedback: Share what’s working and what isn’t. Address issues quickly and acknowledge good performance to build trust and encourage improvements.
Collaborate to Make Improvements: Work together on streamlining operations, optimizing routes, and solving problems to reduce costs and improve service.
Over time, these practices will help you build strong carrier relationships that unlock more opportunities for your business.
Use Data to Negotiate Favorable Rates
In 2025, the key to negotiating how to reduce your freight costs lies in data and strategy. Carriers are looking for valuable partners, and you can demonstrate that value by focusing on:
- Predictive Analytics: Instead of just showing past shipping volume, use AI-driven forecasts to project your future needs. This gives carriers the reliable volume they want.
- Partnership Metrics: Highlight your high first-tender acceptance rates and on-time payments to position yourself as a low-risk, high-quality “shipper of choice.”
- Securing Capacity: With carrier alliances shifting, focus negotiations on securing guaranteed capacity with Minimum Quantity Commitments (MQCs), which often unlocks more favorable, stable rates than one-off spot negotiations.
Tactical Shipment Optimization
This table illustrates how strategic changes can lead to significant savings.
| Cost Driver | High-Cost Scenario (Example) | Cost-Reduction Strategy | Potential Savings / Impact |
| Shipment Timing | Booking an expedited shipment 1 day before pickup. | Planning ahead and booking a standard LTL shipment with a 5-day lead time. | 50-65% reduction on that shipment’s rate. |
| Invoice Errors | Paying invoices without review, missing a 5% overcharge. | Implementing regular freight audits to catch and dispute incorrect charges. | 3-8% of total annual freight spend recovered. |
| Route Inefficiency | A 500-mile trip with 50 unnecessary “empty miles.” | Using AI-powered route optimization to create the most direct, efficient path. | 10-20% savings in fuel and transit time. |
| Shipment Density | Sending three separate small parcel shipments to the same area. | Consolidating the three into a single, larger LTL shipment. | 25-40% reduction in total shipping cost. |
| Fuel Surcharges | Accepting the carrier’s standard, fluctuating fuel surcharge rate. | Negotiating a capped fuel surcharge or using a more favorable index. | 5-10% savings on fuel-related fees. |
Consolidate Shipments to Reduce Overall Freight Costs
Improving the efficiency of each shipment and reducing the number of shipments can make a huge difference in freight costs. By combining smaller shipments into a single, larger one, you can make better use of cargo space and cut down on unnecessary trips.
How to Reduce Freight Costs with Optimized Packaging
Lightweight, efficient packaging materials can reduce the overall weight of your shipments, leading directly to lower shipping costs. Custom packaging tailored to your product dimensions helps minimize wasted space, ensuring each shipment is as compact and cost-effective as possible.
Consider Multimodal Transportation
Choosing the right mode (or modes) of transportation can help prevent wasted spending while improving delivery times. One cost-effective strategy is multimodal transportation, which utilizes various transportation methods like rail, truck, and ocean carriers to move goods between locations.
Ship During Off-Peak Times
While shipping during low-demand periods is still a valid strategy, the definition of “peak” and “off-peak” has become more fluid in 2025. The traditional holiday peak season now effectively begins in August. The best strategy now involves analyzing micro-trends and demand patterns in your specific lanes rather than relying on broad seasonal assumptions.
Reduce Urgent Freight Costs by Increasing Lead Times
When carriers have more time to plan, they can optimize routes, resources, and timing to boost efficiency. This leads to lower rates and better reliability for your shipments. Since expedited shipping can cost two to three times more than standard delivery, extending lead times can save you a ton.
Leveraging Technology and Advanced Planning
Optimize Shipping Routes
Smarter route planning is critical for reducing freight expenses. In 2025, the standard has moved beyond simple GPS tools to AI-powered dynamic route optimization. These advanced systems integrate real-time data on traffic, weather, and even potential labor disruptions to adjust routes on the fly.
Manage Fuel Surcharges
Fuel surcharges have become a more complex and significant factor in 2025. Major carriers have adjusted their fuel surcharge calculation tables, often resulting in a higher effective surcharge percentage. Shippers must diligently audit these charges to avoid overpaying.
Implement a TMS
In 2025, a modern Transportation Management System (TMS) is a centralized data intelligence platform. Leading TMS solutions have integrated AI for predictive analytics, seamless connections to digital freight marketplaces for real-time rate shopping, and robust sustainability tracking.
Work with Smaller Carriers
Bigger isn’t always better when it comes to carriers. You can save money by partnering with smaller or medium-sized shippers who generally have greater flexibility and are more likely to work with you on service levels and rates.
Cut Down On Freight Costs with Zero Down
Understanding how to reduce freight costs can save your business a lot of money. Fortunately, there are a wide range of strategies you can implement to cut expenses and improve cost-efficiency so you can protect your bottom line – and Zero Down can help with them all.
At Zero Down, we have extensive experience optimizing supply chains from start to finish to help lower freight costs while improving service quality. With our Transportation Spend Management System (TSMS), FreightOptics, you can tackle packaging and route optimization, gather shipping data to support your contract carrier negotiations, send timely freight payments to build strong carrier relationships, and much more.
Cutting freight costs requires the right knowledge, tools, and experience. Now that you know what steps you should take, let us help guide you through the process.
Get in touch and start saving today.
FAQ
What is the importance of conducting regular freight audits?
Conducting regular freight audits is essential as they identify billing errors and recover overcharges, resulting in substantial cost savings for companies.
How can building strong carrier relationships reduce freight costs?
Building strong carrier relationships leads to improved collaboration and trust, which ultimately results in better rates and more reliable service, thereby reducing freight costs.
Why is data important in negotiating favorable freight rates?
Data is crucial in negotiating favorable freight rates as it enables you to demonstrate your value as a customer and make informed decisions that can lead to lower costs.
What are the benefits of consolidating shipments?
Consolidating shipments effectively reduces overall freight costs by maximizing cargo space and minimizing the number of trips required.
How can a Transportation Management System (TMS) help reduce freight costs?
A Transportation Management System (TMS) effectively reduces freight costs by offering route planning, load optimization, and real-time visibility, which enhance logistics efficiency and minimize expenses.
What is the fastest way to reduce freight costs in 2025?
The fastest way is often through a thorough freight audit to identify and reclaim immediate savings from billing errors. Simultaneously, using a TMS with real-time rate shopping capabilities can provide instant cost comparisons and savings on your very next shipment.
How can a small business reduce its freight costs?
Small businesses can effectively reduce freight costs by consolidating smaller shipments into larger ones (LTL), partnering with smaller regional carriers who may offer more flexible rates, and optimizing their packaging to reduce dimensional weight.
Does shipping during off-peak times still help reduce freight costs?
Yes, but the definition of “off-peak” has changed. While traditional off-peak times can still offer savings, the peak season now starts as early as August. The best approach is to use shipping data to analyze specific lane activity and identify true low-demand periods for your routes, which provides a more reliable way to reduce freight costs.
