Uncover the hidden costs in produce shipping
In produce logistics, what you don’t see is often what has the biggest impact.
It’s easy to think that controlling freight costs starts and ends with negotiating a better linehaul rate because it’s the most visible number on every invoice. But for companies moving perishable goods with tight margins, that number only tells a fraction of the story.
The truth? Cheap rates can be very expensive. Let’s dig into the hidden costs that sink profit margins and how to bring them to the surface.
The Iceberg (Lettuce) Model of Freight Costs
Think of your freight rate like the head of iceberg lettuce: visible and enticing. But a lot of the plant is actually beneath the surface.
Above the surface:
- Linehaul rates – the upfront cost you pay a carrier to move your freight.
Below the surface:
- OTIF fines (On-Time, In-Full): Even minor delays or shortages can trigger fines from retailers that dwarf any savings on a cheaper carrier.
- Temperature-related claims: Produce requires strict temperature control. A single degree of variance can lead to rejected loads or spoilage claims.
- Manual labor: Time spent building loads, tracking shipments, and chasing updates adds up—fast.
- Manual reporting: Without automation, compiling reports to make strategic decisions eats into team bandwidth.
- Accessorials: Detention, layovers, lumpers—small fees that accumulate over time and distort your true freight cost.
- Emergency replacement loads: When something goes wrong, last-minute shipments are expensive and chaotic.
How Hidden Costs Destroy Your Margin
Produce is a volume-driven business with little room for error. Margins are tight, sometimes just a few cents per pound. That means every fine, claim, or hour of wasted labor diminishes your profitability.
Most executives are shocked by how much time their teams spend manually managing freight. Once they break it down, operations that seem “under control” often consume far more resources than expected.
The biggest challenge? You can’t fix what you can’t see.
- Lack of reporting tools: Many companies rely on spreadsheets or basic TMS tools that don’t surface true cost drivers.
- Siloed data: Sales, logistics, and finance often operate in separate systems, making it tough to connect freight issues with financial outcomes.
So, Let’s Make the Invisible Visible
The good news is that with the right tools the hidden chaos becomes clear.
Centralized visibility platforms and logistics analytics allow you to:
- Identify which customers, carriers, or facilities are driving hidden costs.
- Quantify labor hours tied to manual freight tasks.
- Spot patterns that lead to fines, claims, or emergency loads.
This kind of analysis provides an outside-in perspective that’s consistently missing in day-to-day operations, and it can be a turning point for decision-makers ready to optimize.
Discover the Real Drivers Behind Your Freight Spend
If your strategy is still focused on shaving pennies off the linehaul rate, you’re missing the bigger opportunity. The fastest way to reduce logistics costs isn’t negotiating harder…it’s eliminating the inefficiencies and unknowns lurking below the surface.
Let’s dive into what’s really happening in your produce supply chain. Reach out to one of our team members, and we’ll take an in-depth look at your current operations and find out where you can maximize your freight savings. And learn more about The Produce Shipping Experts here.
About Dynamic Logistix
Dynamic Logistix is a third-party provider of produce shipping and freight solutions that combines a world-class technology platform with stellar personal service. By providing, superior visibility, transparent processes, and comprehensive real-time reporting through our transportation management software, produce clients save time and money. For more information, please visit our website and check out our LinkedIn page to join our growing team.
Contact:
Chelsea Mitchell
media@shipdlx.com
(913) 274-3800
