How Do Freight Classes and NMFC Codes Work?

If your ecommerce business is making big moves and experiencing an increase in order volume, it’s going to require freight shipping to move large amounts of inventory.  With freight shipping comes the need to learn about NMFC codes and freight classes – what they’re for, how their classification system works, and how they relate to specific commodities. Beyond a mere technicality, proper NMFC code and LTL freight class designation have the ability to impact everything from financials to order timeliness. 

This article will explain it in detail, laying out the fundamentals of NMFC codes and freight classes so you can apply them in the most cost-effective, safe, and accurate way possible. 

NMFC Codes Explained 

Ecommerce businesses that need to move large amounts of inventory between suppliers, storage warehouses, and fulfillment centers often use freight shipping. This process frequently involves less-than-truckload (LTL) shipments, where multiple smaller shipments share space on the same truck and need to be classified by specific codes.

NMFC freight codes are standardized classification codes established by the National Motor Freight Traffic Association (NMFTA) and Commodity Classification Standards Board (CCSB). Every commodity has its own specific code. Businesses must write this code along with the freight classification it falls under on the Bill of Lading (BOL). 

These codes are important because they provide a precise description of the commodities being shipped. This standardized identification helps everyone in the supply chain understand the nature of the item, its handling requirements, and any special precautions needed during transport. Accurate NMFC codes ensure that shipments are treated appropriately, reducing the risk of damage, optimizing space in the freight truck, and ensuring compliance with regulations, ultimately leading to smoother and more efficient logistics operations.

Here are some examples of NMFC codes for products commonly shipped by ecommerce businesses:

• Apparel: Casual clothing, like t-shirts and jeans, falls under NMFC Code 49880.
• Dietary Supplements: Supplements and vitamins fall under NMFC Code 57300
• Footwear: Items like boots and athletic shoes are classified under NMFC Code 28160.
• Bedding: Bedding items, such as comforters and pillows, are categorized under NMFC Code 49017.
• Beauty Products: Cosmetics, including items like makeup and hair products, fall under NMFC Code 59420.
• Sporting Goods: Items like gloves and skates, among others, fall under NMFC Code 15520.
• Toys: Toys, including video games, stuffed animals, and board games, are listed under NMFC Code 84260.

Each NMFC code corresponds to a specific commodity and is used to determine the freight class, which affects the pricing. The classification considers factors like density, stowability, handling, and liability. Using the correct NMFC code ensures accurate pricing and helps prevent shipping delays or disputes.

Are NMFC Codes and Harmonized Codes the Same Thing?

NMFC codes shouldn’t be confused with Harmonized Codes – also known as HS, tariff, or commodity codes. The latter belong to the Commodity Description and Coding System, which is a separate framework customs agencies use to apply taxes and duties to international freight. 

Freight Classes Explained 

Freight classes are used to organize items within a shipment based on their individual characteristics. Factors like package size, weight, fragility, and stowability (or how well an item can stack) impact how and where carriers can fit loads onto vehicles. Classification codes make it easier to optimize LTL shipments so that as much cargo as possible can be safely transported in a single trip. 

18 categories ranging from 50 to 500 indicate movement efficiency, with the easiest-to-handle items having lower classification numbers and the most fragile or hard-to-transport ones having higher classification numbers. Generally speaking, the lower a freight classification number is, the lower the shipping cost will be.

How NMFC Codes and Freight Classes Work Together

While NMFC codes and freight classes are related, there isn’t a direct connection between an NMFC code and a specific freight class. Instead, each NMFC code is assigned a freight class based on the characteristics of the commodity it represents. 

For example, two different commodities with different NMFC codes might fall under the same freight class if they share similar shipping characteristics. The NMFC code identifies the items, while the freight class indicates the shipping difficulty and cost.

However, the freight class assigned to each shipment can change depending on its density. Density is calculated as the weight of the shipment divided by its cubic volume (in pounds per cubic foot). Higher density – heavier and more compact items – typically results in a lower freight class, and thus lower cost. Lower density – lighter and bulkier items – results in a higher freight class, and thus higher cost.

Using our previous ecommerce products, here are some examples of potential NMFC code and freight class combinations, and where they might be placed within LTL freight trucks:

Apparel: Casual clothing usually falls into Freight Class 125 or 175, depending on the density, with an NMFC Code of 49880. These items are lightweight, non-fragile, and easy to handle. They can be placed anywhere in the truck, often on top of heavier items or in designated areas for lighter goods to maximize space utilization.

Dietary Supplements: Vitamins and supplements often fall into Freight Class 70 with an NMFC code of 57300. These items are generally small, dense, and can be packed tightly, often being placed in the middle or upper sections of the truck to prevent damage and optimize space.

Footwear: Shoes are classified under Freight Class 125 or 200, depending on the density, with an NMFC Code of 28160. They are more substantial and take up more space than apparel. They are usually placed in the middle sections of the truck to ensure they are securely packed and to prevent crushing under heavier items.

Bedding: Bedding items usually fall into Freight Class 200 with an NMFC Code of 49017. These products are bulky and not easily stackable. They are typically placed towards the back of the truck to allow easy access and to avoid crushing more fragile items.

Beauty Products: Cosmetics are generally in Freight Class 85 with an NMFC Code of 59420. They are small but can be delicate and need careful handling. They are usually placed in the upper sections of the truck or in specially designated compartments to avoid damage.

Sporting Goods: Sports equipment has a large Freight Class range, between 60 and 400 depending on density, with an NMFC Code of 15520. These items are often lightweight but can be bulky. They are usually placed towards the middle of the truck, ensuring they are not crushed by heavier items but also not taking up valuable space needed for other goods.

Toys: Toys and games often fall into a Freight Class between 85 to 175 with an NMFC Code of 84260. They vary in size and fragility. They are typically placed in the upper sections of the truck or near the back for easy access and to prevent damage from heavier items.

How are Freight Classes Determined?

NMFC freight codes and classes are assigned based on four factors, each of which influences how easy a commodity is to transport. Density, stowability, handling requirements, and liability must all be considered on an individual basis.

Density

Density is a measure of how much space an item occupies relative to its weight. It's calculated by dividing weight by volume. Items with higher density generally have lower freight class numbers and are less expensive to ship. 

Density is particularly important for irregularly shaped items or those that don't fit standard packaging. Accurate measurements and weight are crucial for determining the correct density and, subsequently, the appropriate class. Density further plays into shipping costs with last-mile delivery carriers that use dimensional weight pricing models. 

Handling Requirements 

Handling requirements refer to the level of care and special equipment needed to safely transport an item. Freight that requires special handling, such as hazardous materials, fragile items, or oversized goods, typically falls into higher freight classes and costs more to ship.

Factors that influence handling requirements include:

• Need for specialized loading or unloading equipment
• Temperature control requirements
• Fragility or susceptibility to damage
• Hazardous material classifications

Proper identification of handling requirements ensures that carriers can allocate appropriate resources and take necessary precautions during transportation.

Stowability

Stowability is determined by how easily an item can be loaded, stacked, and transported alongside other freight. It considers physical characteristics like shape, dimensions, weight distribution, stackability, and compatibility with standard shipping containers or pallets.

For example, standard boxed items are highly stowable, while irregularly shaped machinery parts or items with protruding components may present stowability challenges. Proper packaging can sometimes improve an item's stowability, potentially affecting LTL freight class assignment.

Liability

When it comes to risk, not all cargo is made equal. Certain types of goods, such as high-value electronics, fine art, or precious metals, are more expensive to replace and may be more susceptible to damage during transit. Low-value, durable goods like construction materials or non-perishable bulk items generally have lower liability risks. Accurate declaration of an item's liability helps ensure proper precautions are taken during transportation and influences the assigned freight classification code.

Exceptions In the NMFC Code and Freight Classification System

There are some exceptions to note within this system. Select commodities with variable characteristics are assessed by density, so their NMFC code falls under more than one freight class. In most density-based classes, a higher density means a lower class, and a lower density means a higher class. Commodities without an official NMFC code are recorded as NOI (Not Otherwise Indicated) and also classified based on density.

Another uncommon but possible scenario worth mentioning, Freight All Kinds (FAK) applies when a carrier consolidates items of different classes into a single container and shipping rate. This is very case-specific and depends on the freight company at hand. 

What Happens When You Get NMFC Codes Wrong

It can be tempting to assign your products certain NMFC codes or freight classes in order to lessen the associated freight costs. However, using incorrect codes can lead to significant issues, including audits, penalties, and shipping delays. It's essential to be aware of every possible implication, whether you’re classifying items yourself or working with a freight forwarder. 

Let's dive into the key areas where NMFC codes can significantly impact your business operations and bottom line:

Shipping Costs and Accessorial Charges

Cost is the most significant implication of NMFC code accuracy, with the potential to impact a company's bottom line in a multitude of ways. Quotes, for starters, are directly affected by NMFC codes. Incorrect classification can lead freight carriers to undercharge or overcharge for their services. In either case, your shipping expenses won’t add up and will be harder to properly track, 

But the financial impact doesn't stop there. Carriers are vigilant about misclassification and may impose additional fees if they discover discrepancies. These accessorial charges range in cost and can quickly add up. Businesses found to be consistently misclassifying freight must pay penalties for non-compliance with NMFC regulations – which comes with long-term financial and reputational impacts.

Classification audits and disputes are also likely to cause shipping delays, which impact supply chain resilience and lead to additional remedial costs such as expedited shipping fees and compensation for dissatisfied customers.

So, although the NMFC system seems gameable, the risks of getting creative with codes and classifications far outweigh any potential short-term gains. Proper classification isn’t just about compliance but is rather a crucial aspect of maintaining a healthy, profitable business operation. However, it's also possible to err too much on the side of caution and end up paying more for your shipments than you should. Partnering with a reputable freight forwarder who knows the industry inside and out can help you identify the optimal NMFC codes for your products, ensuring you pay the best possible prices.

Risk to Safety and Products

The information businesses provide about their shipments helps other parties in the supply chain plan ahead. Misleading code and class designations open the door to significant safety hazards and operational inefficiencies for everyone.

For example, incorrect weight classifications often overload trucks, which both compromise road safety and violate transportation regulations. Misrepresented dimensions can similarly result in inefficient loading, increasing the risk of cargo shifts and potential product-damaging accidents during transit.

Proper classification ensures that all parties in the supply chain can handle the shipment safely and efficiently.

Liability Concerns

If something does go wrong when transporting misclassified goods, the items on board aren't guaranteed to be covered. Because carrier insurance is usually based on freight class, inaccuracy can significantly impact a carrier's liability coverage for your shipments. Some may limit their responsibility for damages or losses based on the declared freight class.

For instance, a shipment of expensive electronics mistakenly classified as LTL freight Class 50 (typically used for low-value, durable goods) instead of Class 85 or higher could limit the carrier's liability to a fraction of the shipment's actual value. This discrepancy leaves the ecommerce businesses shipping these items with substantial unrecovered costs in the event of loss or damage. 

How to Find the Right NMFC Number and Freight Class for Ecommerce Products

Your business is responsible for indicating its shipments’ NMFC code and freight class on the BOL. Properly assigning these categories starts with a comprehensive and accurate idea of the size, shape, and weight of each commodity at hand. 

The official NMFC ClassIT Lookup Tool contains comprehensive listings of LTL freight classifications. Navigate through the categories and subcategories, using your product's characteristics as a guide. Look for items with similar properties to your product, as they're likely to share the same or a similar NMFC code.

FedEx has additional resources that can make this process faster, including an LTL Freight Classification Tool and Freight Class Calculator. 

Just remember that online calculations – as well as ones you do yourself – are only estimates. The NMFTA updates the NMFC classification system multiple times a year. Handlers verify freight classifications and may reclass shipments they believe to be incorrectly assigned. In cases where the actual freight class is lower, this usually results in an adjusted price increase. 

Offload NMFC Freight Code Designation to a Freight Forwarder

If everything about LTL freight classes and codes we just reviewed seems complex, rest assured that it’s only the tip of the iceberg. Correctly applying these designations to real-world freight requires extensive experience and knowledge. If you aren’t confident in your ability to determine NMFC freight class and classify them appropriately – or want to skip the headache altogether – a freight forwarder is the best option.

Third-party logistics companies that also specialize in freight forwarding services arrange and manage the transportation of goods for you. Their expertise extends beyond simply moving goods from point A to point B; a qualified partner will have in-depth knowledge of shipping regulations, customs procedures, and freight classification systems like NMFC codes you can use to compliantly and cost-effectively move large loads of products across the country and around the world. It's simply a matter of finding the right freight forwarder to work with. 

Fulfill and Forward Freight With Shipfusion 

From LTL freight forwarding to ecommerce inventory management, Shipfusion is proud to be growing ecommerce businesses’ first choice for third-party logistics (3PL) services. Our robust software offers real-time quotes from a diverse set of carriers to give you ultimate control over who ships your products post-fulfillment. We can help you there too, of course; a 99.9% accuracy rate ranks us among the best 3PLs in the industry. Contact a member of our team to learn more about the benefits of partnership today.