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How Carriers Price Their Freight May 24, 2012

How Carriers Price Their Freight May 24, 2012. Website : www.3PLogistics.com. ATA Not-Seasonally Adjusted (NSA) Truck Tonnage Index Trends. Straight-Line Forecast for Monthly YoY % Change in ATA NSA Truck Tonnage Index. Source: ATA Truck Tonnage, Morgan Stanley Research.

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How Carriers Price Their Freight May 24, 2012

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  1. How Carriers Price Their FreightMay 24, 2012 Website: www.3PLogistics.com

  2. ATA Not-Seasonally Adjusted (NSA) Truck Tonnage Index Trends Straight-Line Forecast for Monthly YoY % Change in ATA NSA Truck Tonnage Index Source: ATA Truck Tonnage, Morgan Stanley Research

  3. Cass Shipment Index Trends & Straight-Line Forecast Straight-Line Forecast for Monthly YoY % Change in Cass Shipment Index Source: Cass Freight Index, Morgan Stanley Research

  4. Primary Costing System Features P&L Financial Data Operational data, length of haul, class of freight, lane balance,trailer cube, linehaul speed, pickup times, freight handling times, etc. Modifications based on freight bill and operational info. Unit costs, linehaul/mile, pickup-delivery, dock, admin./shipment Computerized formula to give individual shipment costs Marketing/Sales Pricing/Yield Management

  5. Cost Per Mile Comparisons for Carrier X CPM loaded miles CPM with fuel - all miles CPM without fuel - all miles

  6. Mileages – Cost Relationships *Terminal costs include pickup-delivery, platform and billing-collecting.

  7. Fuel Prices $4.06 $98.00 Sources: U.S. Energy Information Administration, Bloomberg News / Graphic by Transport Topics

  8. Fuel Surcharge Base $1.20 Fuel Cost $4.00 Difference $2.80 Miles Per GallonFuel Surcharge 5.5 $0.51 6.0 $0.47 6.5 $0.43 Issues: 1) Short Haul MPG <5.5 2) Empty Miles 10-25% (Biggest Challenge <300 Miles)

  9. Werner Enterprises, Inc. – Systems Results ¹Operating expenses expressed as a percentage of operating revenues. Operation ratio is a common measure in the trucking industry used to evaluate profitability. ²Net of fuel surcharge revenues. ³Amounts in thousands. 4”Empty” refers to miles without trailer cargo.

  10. Werner Enterprises, Inc. – Operating Expenses per Mile Note: Fuel expense line does NOT include owner operator fuel.

  11. Thank You! Milwaukee Wisconsin Office Evan Armstrong Armstrong & Associates, Inc. 10401 West Lincoln Avenue Suite 207 West Allis, WI 53227 USA 414-545-3838 Stoughton Wisconsin Office Richard Armstrong Armstrong & Associates, Inc. 100 Business Park Circle Suite 202 Stoughton, WI 53589 USA 608-873-8929

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