No matter what business you are in, everyone shares one common concern: cost. Minimizing cost and maximizing profits is one of the cornerstones to a successful business. In the moving industry, minimizing costs is important to you, the mover, and to your clients, the shippers. Understanding how to classify costs in a way that also maintains your legal obligations is essential to running a successful moving business.

Just like your movers insurance, nationally agreed up on standards exist for one reason: to protect you. When it comes to classifications for your freight, the National Motor Freight Traffic Association (NMFTA) has come up with two different standards for comparing commodities: Standard Carrier Alpha Codes (SCAC) and Standard Point Location Codes (SPLC). These exist to standardize pricing and standardize freight type.

Today, let’s break down what a Standard Carrier Alpha Code is.

• A unique two-to-four-letter code
• It is used to identify transportation companies – such as your moving company
• The NMFTA publishes a directory of all of the SCACs
• SCACs exist to facilitate computerization in the transportation industry – this means that you can obtain any information you need right off of the Internet

SCACs are typically required when doing business within the United States. They are also required by U.S. government agencies and a vast majority of commercial shippers. If you are involved with:

• The automotive industry
• The petroleum industry
• Forrest products
• Chemical industries
• Retail suppliers

You will be required to obtain accurate SCACs for your shipments. Many commercial shippers and receivers will include SCACs on their freight bill audit and even utilize them with payment systems.

The NMFTA assigns SCACs for all companies, although certain groups of codes are reserved for specific purposes. These include:

• Codes ending with the letter “U” – these are reserved for the identification of freight containers
• Codes ending with the letter “X” – these are reserved for the identification of privately owned railroad cards
• Codes ending with the letter “Z” – these are reserved for the identification of trucks and trailers used internationally

At Wolpert Insurance, we can always review your moving company’s legal requirements – including NMFTA regulations. All you have to do is give us a call! Be sure to check back next week when we go over the second NMFTA regulation: Standard Point Location Codes.