Freight optimization
What is freight optimization?
Freight optimization is the process of planning and executing freight shipments in the most efficient way possible, balancing cost and service requirements across all available modes, routes, carriers and load configurations. The goal is to move goods at the right cost and service level—not just the lowest cost, and not just the fastest option, but the combination that best fits the shipper's priorities for each shipment.
Freight optimization is inherently multimodal. Shippers can move goods by ground (truckload, less-than-truckload, parcel), rail, air or intermodal transportation, or internationally by air and ocean. Not every mode suits every shipment—freight optimization determines the best fit based on cost, transit time, cargo type and customer expectations.
Freight optimization: balancing cost and service
Every freight optimization decision involves a tradeoff between cost and service. Two distinct orientations shape how that tradeoff is made:
Cost-focused optimization is appropriate when a shipment does not require expedited service or special handling. Cost optimization tools focus on load consolidation, pooled shipments, advanced routing and reducing the number of moves required to deliver a load. Moving fuller loads and reducing total shipment count creates savings without affecting service where flexibility exists.
Service-focused optimization applies when delivery speed or customer expectations take priority over cost. Same-day delivery, next-day delivery, installation and setup all come with additional cost, but meeting those commitments supports repeat buyers and brand loyalty. Estimated arrival updates and in-transit status visibility support service-focused execution.
The best freight optimization strategies are not fixed—they adapt to each shipment based on the shipper's current priorities.
What is freight optimization software?
Freight optimization software helps shippers select the best mode, carrier, rate and route for every shipment. These platforms compile and analyze supply chain data to identify performance gaps and surface transportation options that better fit cost and service requirements—including alternatives for modes, routes, providers, rates and services.
Modern optimization software handles multimodal planning: organizing and sequencing multi-mode shipments and handoffs so each leg of a delivery supports the next. It considers the full scope of the supply chain—from inventory availability and load configuration to carrier capacity and on-time, in-full delivery performance.
Multimodal freight optimization
Multimodal freight optimization combines multiple shipping modes to move cargo from origin to destination as safely, quickly and affordably as possible. Key areas multimodal optimization addresses include:
Load consolidation and pooled shipments across modes
Equipment utilization—matching the right equipment type to each load
Route sequencing across multiple legs and handoffs
Inbound, outbound and return shipment planning
Carrier performance and rate analysis across the network
Sustainability improvements through reduced empty miles and fuel consumption
How technology supports freight optimization
A transportation management system (TMS) with built-in optimization capabilities gives shippers the tools to improve performance across the entire freight network—from basic load consolidation to complex multimodal strategies. Key capabilities include:
All-mode rating: A comprehensive view of market rates across modes, service levels and route options
Equipment utilization: Identifying the right equipment for every load to control cost and support sustainability goals
Dynamic rerouting: Adjusting routes in real time to account for changes without affecting existing delivery commitments
Street-level optimization: Scenario modeling from the first mile through the last mile, identifying the best moves across the full network
Performance reporting: Tracking network performance to identify gaps and improvement opportunities
These capabilities help shippers source capacity quickly, manage carrier relationships, rate and optimize every load and continuously improve their transportation strategy.