Cost is the major decider for many transportation companies when choosing who to partner with. We like to think of “cost” in terms of value – is the cost you’re paying worth the value you are getting from the provider, in terms of performance and extras? No matter the cost, what all companies who are involved in the shipments of refrigerated goods hope for is that all costs are worked out prior to pick up. There is nothing worse than delivering a load, and being hit with hidden costs and accessorial fees. There are 3 hidden costs that we see companies face when shipping refrigerated goods in particular: detention fees, overweight costs, and lumper fees. It’s critical to understand how these fees happen, and what can be done prior to make sure all parties are aware of them before agreeing to shipments.
1. Detention/Overnight/Layover Costs
These types of costs can be caused by a variety of reasons, such as:
- Documentation issues – incorrect, incomplete or documents that are not received in time for customs clearance can cause delays.
- Backlogs at pickup or delivery – on the pickup side, product might not be ready in time, and on the delivery side, often getting a door can take a while if there are several other loads trying to deliver.
- Inspection – oftentimes, trucks are stopped by police, roadside FMCSA inspectors, or other authorities for inspection of the cargo – this often takes longer than expected, and is outside of anyone`s control.
In some cases, there are things that can be done to avoid these types of hidden costs:
- Up-front detention negotiations. Make sure drivers understand what they will be paid, and keep to your word. Make sure they are aware of their allotted “free time” and when to start billing for delays. The best way to make sure each party agrees on the charges is to also have backup documents that indicate when the driver checked in vs. when they were finally loaded/unloaded.
- For border loads, pre-clear your cargo with customs.
- Issue loading and delivery instructions to drivers well in advance. This gives the carrier time to schedule pickups and deliveries – its also good to make sure the shipper and receiver are ready when the load arrives.
- Schedule your loading/unloading with the detention clock in mind. You may think you have longer than you really do. Make sure all appointments made give plenty of time to account for loading and unloading with the detention clock in mind.
2. Overweight Costs
Produce loads are tricky because they are not consistent in terms of weight. For example, leafy greens will weigh much less than a load of heavy pack apples. And, drivers are always hauling different types of produce, in full loads and mixers. Therefore, weights can be hard to predict and inconsistent. However, overweight costs can be avoided. Here`s how:
- Be up front with your transportation provider on how much a load will weigh; and for drivers, on how much weight your trailer can take.
- Ensure that all equipment is maintained. This includes the truck itself and the weigh scales that are being used to weigh loads; keeping all equipment well maintained prevents errors, damage, and accidents from occurring. In addition, weighing equipment should calibrated by professionals on a regular basis. Finally, a truck needs to meet the current safety, size, and weight regulations for their sector. The FMCSA has a handy webpage for weights and dimensions allowable in the United Sates and Canada
- Take fuel weight into account. It is common practice for drivers to account for fuel while measuring the weight of the load. If the truck is being sent long-haul, a driver can calculate how much fuel will be used between stops, as well as how much you may need to take on in between. Some drivers find that a few extra stops for re-fueling with smaller quantities are more beneficial than paying a fine for being overweight.
- Use on-board scales for extra peace of mind. The use of on-board weigh scales allow drivers to not rely on fixed scales alone. Investing in a secondary set of scales can make a huge difference to the amount of time and effort you spend on weighing loads, as well as help you prevent overweight trucks. Just like a stationary or platform scale, these need to be kept in perfect shape with regular checks, maintenance and calibration.
- Get a permit if you are often overweight. Check out any overweight load permits available in your area. Generally, a gross vehicle load that weighs over 80,000 pounds is considered overweight, but make sure your permit covers the projected loads you might be transporting, as well as any special vehicle size requirements to tackle these loads. The FMSCA also has a handy webpage for oversize/overweight permitting in the United States and Canada. Note that weight permit costs vary by state.
3. Lumper Costs
Lumpers are the third common hidden costs that companies face when shipping refrigerated goods. A lumper is a fee charged when a shipper utilizes 3rd party workers to help load or unload the contents of a trailer, and are often used at food warehousing companies and grocery distributors. These fees are often reimbursable to the driver by the shipper or the freight broker. Lumpers can allow for drivers to catch up on rest and save energy for their driving. But, many drivers have reported that they have run into issues with lumpers – for example, they often use the trailer to restack boxes, which can take up more time and keep the driver waiting longer at a shed.
There are some ways to best manage lumper fees:
- Make sure all parties including the shipper/receiver, transportation provider, and driver are aware of what the lumper fees are. In addition, make sure that everyone is aware of how the lumper will be paid, as some warehouses have accounts for customers, some prefer cash, etc.
- Communicate the procedures for lumping. The driver should be aware of how the truck will be loaded/unloaded, especially if they have a reload or a tight schedule to adhere to. Communicating the procedure will allow the driver to be aware of their timing, and will avoid delays which can cause detention fees.