The Freight Doctor

First off, what are ACCESSORIAL CHARGES? Accessorial charges (also called assessorial charges) are charges made for performing freight services beyond normal pickup and delivery such as inside delivery, waiting time, fuel surcharges and storage charges etc….
Here are a few of the charges and ways to avoid getting charged for them.

DETENTION: A penalty charge against shippers or consignees for delaying carrier’s equipment beyond allowed time. Demurrage applies to cargo; detention applies to equipment. Most logistic carriers allow anywhere from 12 - 24 hours of free time for loading and unloading. After this expiration charges from $50 - $100 for each 24-hour period takes effect. (After 30 days in detention they may increase the per diem as well).

SOLUTION: Planning and Coordination. Make the calls first to see if first, your client is ready to receive the shipment and/or your Logistics Transportation is ready to ship when you are. If you are the customer, be sure that there is always open communication between you, the logistics team / freight forwarder and the companies with whom you are working. Be sure to read the fine print and find out if there are also extra charges for palletized loads and floor loads.

LOADING & UNLOADING: Carrier assists at customer request only, under 25lbs per carton. Driver may not use or be responsible for any dock equipment. Carriers charge prices from $55 - $75 per-hour (mostly subject to a 2-hour minimum.) for loading and unloading.

SOLUTION: Your logistics managers should have a discount with the trucking company moving your product. Some of these discounts can be as low as $15-$25 per load (including both loading and unloading). These prices are guaranteed during negotiations with the trucking company before the shipments are set up to distribute.

RESIDENTIAL DELIVERY: If you do not have a commercial location that actually opens and closes at set times each day within a commercially zoned area, you will be considered a residence and extra fees will apply for pickup and delivery.

SOLUTION #1: These rates are almost the amount of shipping whiteglove (”Whiteglove” is the cost for pick-up, delievery, and any set-up required.) Knowing this, be sure that if your company relies on pickups and delieveries on Sundays and Holidays, you have worked out a deal in your rates & contracts for these shipments. They can be lowered if that is your entire logistical business, but know that the freight companies work on a skeleton crew during these hours and because of union rules and regulations, they are also working on a time and-a- half pay scale, and those wages come from YOUR shipment.

SOLUTION #2: Here’s where it gets tricky. Some people like to work from home, which is great, except when you have things shipped out or delievered to you. Notice that it does say “commercially zoned area”. If you do have a commercial place of business (or you can arrange to setup at a commerical place of business) where you can ship out and receive that would be your best bet to save money.

LIFT-GATE: When the shipping or receiving address does not have a loading dock, manual loading or unloading is necessary. A liftgate is a platform at the back of certain trucks that can raise and lower a shipment from the ground to the truck. Additional fees apply for this service.

SOLUTION: This is similar to the loading and unloading solution (Your logistics managers should have a discount with the trucking company moving your product. Some of these discounts can be as low as $15-$25 per load (including both loading and unloading). These prices are guaranteed during negotiations with the trucking company before the shipments are set up to distribute.) Also, a short-cut to this can also be, if you are working in or near a place that either has it’s own lift or you have people at your company that can assist in loading/unloading the product, you can save money on that too. There are also some freight companies that have smaller bobtails that can be better to use for these shipments.

More on Accessorial Charges later this week. Until then, I’ll see you on the docks!

-The Freight Doctor
http://www.thefreightdoctor.com

An international freight forwarder is an agent for the exporter in moving cargo to an overseas destination. These agents are familiar with the import rules and regulations of foreign countries, the export regulations of the U.S. government, the methods of shipping, and the documents related to foreign trade.

Freight forwarders assist exporters in preparing price quotations by advising on freight costs, port charges, consular fees, costs of special documentation, insurance costs, and their handling fees. They recommend the packing methods that will protect the merchandise during transit or can arrange to have the merchandise packed at the port or containerized. If the exporter prefers, freight forwarders can reserve the necessary space on a vessel, aircraft, train, or truck. The cost for their services is a legitimate export cost that should be included in the price charged to the customer.

Once the order is ready for shipment, freight forwarders should review all documents to ensure that everything is in order. This is of particular importance with letter of credit payment terms. They may also prepare the bill of lading and any special required documentation.

After shipment, they can route the documents to the seller, the buyer, or to a paying bank. Freight forwarders can also make arrangements with customs brokers overseas to ensure that the goods comply with customs export documentation regulations.

-The Freight Doctor
http://www.thefreightdoctor.com

If you’re planning on shipping internationally, you’ll find that your “pre-shipment checklist” will become the bane of your existence. Before your goods can even begin its trek across the world, you’re going to have to get some paperwork done.First, to alleviate the stress of coordinating all the logistics with your shipment, the wisest thing to do is to work with either a Customs Brokers or Freight Forwarders. When you’re trying to choose your Customs Broker or Freight Forwarder, you need to be sure they can accomplish the following: They need to help prepare import and export documentation· They’ll facilitate the movement of goods through customs
· Reserving cargo space on various transportation modes and monitor shipments for you is also their responsibility.

Customs Brokers are private individuals, partnerships, associations or corporations that prepare and file entries, arrange for payment of duties, arrange for release of goods in Customs Custody and otherwise represent their clients in Customs matters.

It is vitally important that you select a Customs Broker who can handle your customs business efficiently and accurately. A good Customs Broker is an invaluable partner. By working closely with the broker on classification and valuation issues, you can minimize entry errors and enhance compliance. The wrong Customs Broker, however, can result in delayed clearances, errors on entries, and possible fines.
When you are considering choosing (or changing) Customs Brokers you need to look into the following:

1. Do you have a specialized product line or type of import? You may wish to find a broker who either specializes or has a great deal of expertise in clearing your type of products.

2. How many ports will you be using for your imports? If you are importing through a great number of ports, you will want to hire a broker with its own offices in those ports. Your local one-office broker may give you great service in his home port, but they will have to use sub-agents in other ports and thus will lose a great deal of control. By the same token, if you are only importing through one port, the smaller, one-port broker may be perfect for you since they can often give you much more personalized, hands-on service.

3. Your broker should be able to communicate easily with you via telephone, e-mail and fax.

4. If your volume of imports is large enough, you should have a key operational contact at your broker who will coordinate all aspects of your account.

5. Most importantly, I recommend that you write a working agreement with your broker(s). The agreement should include the scope of work that you want the broker to perform, the fee structure for each service performed, and operational procedures and contacts. This document should be available to all of your personnel who work directly with the broker. You should periodically review the agreement with your broker and make adjustments to reflect any changes in your business situation.

6. Your Customs Broker should be your partner in every sense of the word. Be sure to give your broker all the information they need to handle your entries. Similarly, insist on getting all the information from your broker that you need to have a successful import program.
If you have questions about how your broker is handling your account, ask!

-The Freight Doctor
http://www.thefreightdoctor.com

Previously, we talked about having great customer care from a dependable freight carrier, no matter the size of the order. We also discussed the ways to keep up with that “attention filled honeymoon stage.” So, now that you know the problems which come up during the relationship with your freight carrier, how can you be sure you won’t be just another reference code in their books?

There is truly no guarantee that your freight provider won’t act, react or respond in the ways previously noted, but there are ways for you to respond and react to a situation like this:

• If you are dissatisfied with the service provided by your local carrier, you MUST contact them personally to let them know. Don’t assume that their customer service associate will call you on a follow-up to see if every shipment was satisfactory.

• Keep a personal track of the drivers, especially if the driver was rude or if they are consistently showing up late and holding back the deliveries.

• Start to look around for more than 2 carrier services. Of course, this is easier said than done. However, if you are diligent and express what you are looking for in a freight company (i.e. expecting exemplary service and that you plan to hold them accountable for any promises made during your initial meetings), then you will be less likely to run in to the same problems again. If a freight carrier is hesistant and finds ways around agreeing to your terms, just move on to the next name on the list. In this business you DO NOT have to settle.

• Expect that you will pay a DECENT rate for exemplary service. There are times where a customer is at fault when they deal with a carrier. Demanding huge discounts and unreasonably low rates right off the bat. You invite real shoddy service if you’re demanding a company look for ways to tim their cost — and that will be at your expense because we’re all familiar with the phrase “you get what you pay for.” You can also be sure when you’re offered rates well below the industry average that you will wind up with service problems and fees that creep up later (i.e. residential delivery, life fate, inside deliver, notification and, one of the biggest fees you never hear about until later, the sort and segregate fee).

• If you find that you do not want to deal with the freight carriers themselves, find a reliable and cost effective freight forwarder/logistics manager. You will be amazed at all the discounts those who have been in the freight industry can for you. The fees mentioned about are normally discounted to these logistics managers where someone not “in the know” will pay them at full pop without question. One of the big PROs to working with a freight forwarder is that they are dealing with more than 4 or 5 other freight carriers and are under constant negotiations, which turns in to lower rates for YOU, the customer. A CON is that the logistics manager is dealing with the carriers and are marking those rates up to make a profit for themselves. Always double check rates to make sure they are lower than if you had handled them yourself.

• And finally, if you continue to try to work with your primary freight carrier and it seems your complaints are falling on deaf ears, then you must shop around for a new shipper. Hiring a new carrier is a big job with a lot of work involved. You’ll have to familiarize the new company with your products and special requirements, get to know the drivers and company staff and then contact your vendors to get everything in line.

In the end, changing freight carriers can really only be beneficial if you keep up regular communication and make sure neither party takes the other for granted. Much like a successful marriage, a customer-freight provider relationship will only thrive when both are dependent on keeping an honest and open communication.
 

-The Freight Doctor
http://www.thefreightdoctor.com