Shipping costs have a major impact on the profitability of your business – especially if you’re a small or medium-sized organization with razor-thin margins. So having an accurate estimate of your shipping fees is crucial in avoiding unexpected surcharges that can hurt your bottom line.
While you can’t predict every situation that may pop up, there are several things you can do to help mitigate (or even eliminate) surprise surcharges on your trucking rates.
Know the Common Carrier Surcharges
In order to avoid added fees, you need to know all the different situations and services that incur surcharges from your carrier. These include:
- Dwell time. This is the amount of time a truck waits at a loading dock for either the loading or unloading of freight. Carriers include a set amount of time in their rate for each delivery, and anything that keeps the truck longer than that time – loading dock bottlenecks, a delay getting pallets ready for loading, etc. – will cost you more on that delivery.
- Layover. Closely related to dwell time, a layover happens when you order a truck for pickup, but your shipment isn’t ready by close of business. As a result, the driver has to spend the night and pick up your shipment in the morning.
- Redelivery. Whether it’s an incorrect address, incorrect estimation of truck size requirements at the destination facility or another issue that results in a shipment not being delivered as agreed, you’re going to end up paying more for another delivery attempt.
- Special services. Are the loading docks on both ends of your shipment appropriate for truck delivery, or will they require a liftgate? Do you have appropriate manpower at both ends to cover loading and unloading, or will the driver be forced to help to get the job done? Does the truck need to make additional stops along the route (multi-stop deliveries)? Any services above and beyond driving the load from Point A to Point B can result in surcharges.
- Incorrect or incomplete customs paperwork. Shipping cross-border? You need to have your customs broker and paperwork lined up before you book the shipment. If your load gets delayed in customs, it can get very expensive, very quickly.
Communication and Planning: The Keys to Avoiding Carrier Surcharges
The good news is, you can avoid the majority of surcharges by communicating clearly with your carrier and carefully reviewing your contract and their policies. Here are some tips to make that happen:
- Get fixed cost quotes in writing. Before the carrier or broker dispatches a truck, ensure the truck load description is complete and accurate, and that the quote includes all fees the carrier will charge for the load. This written confirmation avoids you having to prove something said in a phone call in the event the invoice doesn’t match what the carrier promised.
- Ensure all measurements and weights are accurate. If your load is bigger or heavier than you told the carrier, their cost quote won’t be correct and you’ll pay more than agreed.
- Understand all of your carrier’s special services and what situations will require them. Giving your shipping partner a clear picture of the loading/unloading environment at both pickup and destination will help them spot these for you and ensure they include them in their quote. Will they need a liftgate? Will the driver be expected to help with loading/unloading? Does your recipient require scheduled delivery times instead of allowing drop-off anytime during business hours? Will a full-size tractor-trailer be able to turn around in and/or navigate easily through your loading and unloading zones?
- Verify the charges. Check that charges included on every load (e.g., taxes, fuel, etc.) are included in the quote so they’re not a surprise after delivery.
- Have teams ready upon arrival. Coordinate your carrier and dock teams to make sure every load is ready when the truck arrives to pick it up (and the receiving dock is ready for drop-off). Truck detention surcharges can quickly add up. Try to keep both your finances and your carriers happy by minimizing the time each truck spends in your facility.
- Consider international regulations and requirements. If your shipment’s going cross-border, get everything coordinated in advance. Line up a customs broker and make sure all paperwork is complete before you book the load. Customs issues can cause major delays and expenses.
Shipping is expensive enough without a laundry list of unforeseen carrier surcharges on your invoice. Some surcharges are unavoidable, like fuel, but you can minimize or eliminate some of them just by improving communication with your carriers and optimizing your loading and unloading operations.