Freight Costs Are Rising Fast. Is Your Capital Budget Ready?
Hospitals typically use every approved budget dollar for capital purchases. After months of planning, negotiation and contracting, costs have been carefully analyzed to ensure budgets cover products, services and implementation costs. One exception is the cost of freight (shipping) for the “last mile” delivery to the hospital. Suppliers usually estimate freight costs, but some leave them “TBD” until delivery time. Either way, supplier quotes include “fine print” language that allows for adjusting freight costs based on market conditions and fuel prices. Today, driver shortages, fewer trucks on the road, rising insurance costs, and surging fuel prices have caused freight costs to jump by 50% or more. Market conditions are forecast to remain volatile through 2026, so how can you avoid unplanned freight costs blowing your capital budget?
Plan for Higher Freight Costs, Build Contingency Funds
It’s never fun to need more money for previously-approved purchases. With freight costs expected to remain high, budgets built last year may not cover this year’s actual costs. Plan now for this scenario to avoid coming up short.
A Miga hospital client recently got hit with higher freight costs. In late 2025, they purchased 113 new stretchers for a new facility opening in June 2026. The supplier had estimated a freight cost of $425 per stretcher, and the hospital budgeted that amount. After the first 82 stretchers were delivered, the freight costs had jumped 89% (from $425 to $805 each) or $18,000 more than the freight budget for the entire project. With no surplus to cover extra costs, the hospital told the supplier to delay the shipment of the final 31 stretchers. Fortunately, the hospital had a strong supplier rep who convinced his own leadership to absorb the freight cost on the final shipment. The 31 stretchers arrived on time. In this case it all worked out, but it won’t always.
Safest way to protect your budget in 2026? Assume higher rates will persist and build contingencies for purchases where freight costs may exceed the budget. Better safe than sorry.
Does your budget need to find hidden savings?
Utilize Miga information and expertise to support strategic decisions and find savings that can enable you to cover rising freight costs. Capital planning, product research, fair market valuation and more all cost less with better information.
Miga helps hospitals improve purchasing decisions, supplier management, contract performance, capital planning, and equipment lifecycle management through practical, data-driven strategies that support better operational and financial outcomes.