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Blog · Forecast and pipeline · Freight brokers and 3PLs

Tender rejection rate by lane: the capacity signal in your own tender log

How a freight broker reads its tender log as a capacity signal: rejections over tenders per lane per week, the lanes where the rate rose against their own baseline before spot rates did, the carriers rejecting most on each lane, the cost of a rejection in the spread between the contracted rate and the cover rate, and the shipper conversation that a rising rejection rate should trigger before the lane goes to spot.

The short answerTender rejection rate is tenders refused over tenders offered, per lane per week, from the broker's own tender log. Against each lane's own baseline it rises weeks before spot rates do, because carriers refuse contracted loads when they can get more elsewhere. The cost per rejection is the spread between the contracted rate and the rate the load was covered at. Lanes with a rising rejection rate, ranked by loads and spread, are the list for a shipper conversation about rate or volume before the lane is on the spot market at a loss.

A broker learns a lane has tightened when the loads stop covering and the margin goes negative. The tender log knew three weeks earlier, when the first-choice carriers started refusing. This guide sets out the rejection rate per lane against its baseline, the carriers behind it, the cost per rejection, and the shipper list.

The measures

Per lane, per week:

Rejection rate = tenders refused ÷ tenders offered Baseline = median weekly rejection rate, trailing 26 weeks Rising if rate > baseline × multiple for a stated number of weeks

Per lane, per carrier:

Rejection rate, to find who is refusing

Per rejected load:

Cost of rejection = cover rate − contracted rate

The rows you need

  • Tender log: tender, load, lane, carrier, date, accepted or refused.
  • Load ledger: load, lane, shipper, contracted rate, cover rate, carrier moved.

Shipper and carrier identifiers only.

The assertion

every refused tender's load has a subsequent accepted tender or is marked uncovered

A load with a refusal and no further tender is either uncovered or moved off-system, and it is listed.

A worked view

Lane Tenders/wk Rejection now Baseline Weeks rising Loads affected Cost of rejections/wk Top rejecting carrier
CHI to DAL 52 34% 11% 4 18 $9,400 C-0217, 61%
ATL to MIA 35 9% 8% 0 3 $600
LAX to PHX 15 40% 30% 1 6 $1,800 C-0442, 70%

The Chicago to Dallas lane's first-choice carrier now refuses six tenders in ten, the rate has tripled against baseline over a month, and it is costing nine thousand dollars a week to cover. The shipper conversation is this week. The Los Angeles lane has always been hard and one week does not make a trend.

The shipper list

Shipper Lane Contracted rate Recent cover rate Spread Loads/wk Ask
2207 CHI to DAL $1,850 $2,370 $520 52 Rate adjustment, or 30% at spot

Where it goes wrong

Rejections read from the index. The nation tightened; the lane is what matters.

No carrier split. The lane looks tight when one carrier has repriced.

Cost of rejection not computed. The conversation has no number.

Conversation after the margin turns. The lane is already at a loss.

Every week, rejection rate per lane

Mapped once, the tender log and the load ledger produce the rate per lane against baseline, the carrier split, the cost of rejections and the shipper list every week. Covirage builds this from the exports as they are. The freight page describes the setup, and the margin per load guide covers where the cost of rejections ends up.

Questions people ask

Why is the broker's own log better than a market index?

A market index says capacity is tightening nationally. The broker's log says which of its lanes, with which carriers, at what cost per load, this week. The index is context; the log is the list.

What is the cover rate?

The rate at which a rejected load was eventually moved, usually with a spot carrier. Cover rate minus contracted rate is the cost of the rejection, per load, from the load ledger. Summed per lane, it is what the rising rejection rate is costing.

What is the shipper conversation?

A contracted lane whose rejection rate has doubled is a lane whose contracted rate is now below market. The conversation is a rate adjustment, a volume commitment change, or an agreed share of loads at spot, and it is better had at 20 percent rejection than at 60.