An effective drayage depends on many factors and, in many cases, when not properly coordinated, can cause the costs associated with the drayage process to get out of control. Inevitably, this will have financial implications for the overall supply chain operation. Sometimes, even when the business does everything, it could still incur charges that were never meant to be due to failure by the drayage provider.
Common (and Hidden) Drayage Fees Every Shipper Should Know About
The nature of drayage operations means leveraging public facilities such as ports to receive international shipments and clear customs before the business can deliver them to their final destination.
There are common and hidden charges associated with this:
Demurrage Fees: Avoiding Delays at the Port
Containers are allowed free time to remain at the port, but when that free time is exceeded, charges can quickly rack up, eventually creating a hefty bill for delayed pickups. To avoid this, ensure the container is removed as soon as possible, especially before the free time is up.
Detention/Per Diem Fees: Managing Equipment Use
Containers outside the ports also have an allotted free time before returning to the carriers. This time increases daily and can also be impacted by port delays, meaning that detention almost always follows demurrage charges.
Driver Detention/Waiting Time Fees: Reducing Delays
These are fees or charges that occur when truckers and drivers are forced to wait during loading or unloading. Unfortunately, if the process is delayed, these can pile up, as drivers charge for their time.
Chassis Split Fees: Unforeseen Extra Trips
Chassis split fees arise when a driver must make a separate trip to retrieve a chassis that isn't available at the same location as the container. This is usually because of mismatches in equipment availability at the port.
Pre-Pull Fees: Storing Containers Overnight
Pre-pull fees occur when a container is picked up from the port but cannot be delivered to the destination on the same day. This means the trucker must store the container overnight, adding a charge. Shippers can avoid this fee by ensuring delivery windows align with pickup times.
Drop Fees: Handling Delays in Unloading
Drop fees are charged when a driver drops off a container at the warehouse and returns it later for pickup. To avoid these, shippers can enhance coordination between the warehouse and drivers and opt for live loading or unloading, ensuring the container is unloaded while the driver waits.
Additional Charges That Can Add Up Quickly
Several other fees can also accumulate if not properly managed. Understanding and planning for these costs can help shippers stay within budget.
Overweight Fees: Planning for Legal Weight Limits
Overweight fees are imposed when containers exceed legal weight limits, leading to permits or surcharges. Accurate weight checks and communication with carriers are essential to prevent costly surprises.
Terminal Charges: Understanding Specific Port Fees
Some terminals also set their charges in addition to the port fees, so shippers must research and find specific charges associated with each terminal to avoid surprises.
Fuel Surcharge: Adjusting for Market Changes
Fuel surcharges exist because of fluctuating fuel prices and can be passed on to the shipper. They can be unexpected, but fortunately, shippers can mitigate them by collaborating with their logistics providers for better predictions.
Toll Fees: Navigating Toll Roads
Trucks using toll roads will incur more charges for the shipper. However, leveraging route optimization and planning can avoid or minimize these charges.
Best Practices for Reducing Hidden Drayage Costs
Charges can be financially devastating, but there are steps or best practices shippers can take to thoroughly mitigate them and their impact on the overall supply chain's finances.
Plan Ahead and Be Proactive
Planning allows the business to leverage drayage resources well in advance to avoid scheduling issues and peak congestion and reduce the risk of delays. It puts the shipper in the driver's seat to minimize the risk of demurrage and detention fees. Real-time tracking solutions also play a significant role.
Work with a Reliable 3PL Partner
Collaborate with a reliable drayage provider with experience, expertise, and resources to ensure a seamless process. A good 3PL will offer transparent pricing, clear communication, and expert handling of all aspects of the drayage process.
Leverage Local Knowledge
Working with a drayage provider with local expertise helps avoid common pitfalls like chassis shortages or terminal delays. Continental Logistics's on-the-ground experience can significantly affect regions like Savannah, where port operations can be complex.
Supercharge Drayage in the Savannah Region with Continental Logistics
Continental Logistics helps shippers minimize hidden costs with efficient drayage operations, technology-driven solutions, and local expertise. Although the Port of Savannah offers numerous warehouse options, it's essential to partner with a logistics provider with access to a diverse warehouse network to keep your supply chain operations running smoothly. For such a partner, look no further than Continental Logistics. Connect with us today to see the difference.
