the PartnerShip Connection blog
the PartnerShip Connection blog
the PartnerShip Connection blog
the PartnerShip Connection blog
the PartnerShip Connection blog
6 Surefire Ways You Can Overcome Freight Capacity Challenges
05/04/2021 — Jen Deming
Sometimes, it’s just hard to find a truck. With a capacity crunch that’s been ongoing for as long as we can remember, the struggle to get your LTL loads covered is old news. But, it’s still relevant news. In fact, it seems like things are projected to get even tougher as more freight enters the network. So, while the capacity challenges continue, how can you get your loads covered without breaking the bank?
Why are there capacity challenges?
First, it’s important to understand why capacity is so tight in the first place. It all boils down to an oversaturated freight network – there’s simply not enough trucks on the road available to move every existing freight load. More money is being spent on goods than services, we’re looking at a 6% year over year growth in demand, and this shift in consumer spending is really tightening things up. While the trend has existed for years, the effects of COVID further propelled a push in consumer spending. Due to a diminished staff, freight is being held up within transit at distribution centers and terminals. All of these factors create the perfect storm that make it harder to find trucks for your freight.
Why should you care?
While the effects of a capacity crunch can seem pretty obvious, there may be more challenges than you expect. The immediate issue is getting your freight shipment covered at all. LTL freight carriers are becoming more particular about the loads they want to move and locations they want to visit. Pick-ups may be infrequent, and if your shipment is particularly challenging, like oversized, for example, it may be refused.
Transit times are becoming longer, with 87.9% of shippers reporting a delay in deliveries. Some carriers are also suspending or amending time-critical and guaranteed options. Base rates are higher than ever before, and LTL carriers are now charging detention fees in some cases when loading is delayed. This accessorial fee is typically just associated with truckload shipping, but with a driver’s time being a vital commodity, carriers are pushing back and using it for LTL shipments as well.
What Can You Do to Overcome Capacity Challenges?
- Expand your current network
One of the first things you should do to increase the odds that your freight will get covered, is taking a hard look at your current carrier options to see where you can improve or expand. Conducting a freight audit can help determine if your business needs are truly being met. Look for reoccurring challenges like missed pick-ups or high accessorial fees. Some carriers may visit locations where demand isn’t as high only one or two times a week, which can create a big issue with your shipping schedule. Accessorials like limited access can vary by carrier and it’s possible the one you are currently using may be charging more than a competitor carrier would. Exploring alternative carriers to review service levels and pricing is a great place to start. If you are finding several carriers that may fit your needs, keep them on file so you can rate shop between them and choose accordingly as back-ups.
- Build in extra time for everything
- Review alternative services for applicable shipments
- Consolidate your shipments
- Utilize regional carrier options
- Become a shipper of choice
Want to know a surefire way to combat freight capacity issues? Become a shipper of choice. This means to do everything possible to leverage your relationships with carriers to make your shipments as desirable as possible. The freight load itself, your location, and your business practices combined should create an easy, efficient, and positive experience for the carrier.
A good way to start is making sure your shipping location is set up for easy navigation. Signs and directional assistance, communication, and a safe, clear dock location are all things drivers look out for. Flexible delivery times and plentiful parking options help eliminate some extra stress for the driver, as well. Above all else, doing what you can to eliminate potential detention time is critical. Staged shipments that are primed and waiting with a well-trained and ready-to-go loading team help ensure the truck will be loaded within the 2-hour limit. That way, the driver can get back on the road to the next location with minimal delay. Nurturing these carrier relationships by improving the experience for the driver is important, and it matters. When there’s lots of freight waiting to be picked up nationwide, be the one that the carrier wants most.
Time is the name of the game in shipping. One of the smartest things that you can do to combat freight capacity challenges is building in extra time at every step of the shipping process. When you get an idea of a project or order you will be working on, start quoting as soon as you know details. If you have reoccurring orders for an established customer, approach carriers with the opportunity to explore contract pricing and get commitments for the length of the project. Carriers are looking for reliable, predictable loads that are going to guarantee business while creating minimal headaches. If you can prove your business can meet these expectations, they are going to be even more willing to commit for the long-haul. An added bonus - they are likely to negotiate terms and better pricing for your business as well. Packing and staging your shipments early so that they are ready for pick-up and will be loaded smoothly is going to go a long way in the eyes of the arriving carrier.
While choosing alternative freight services for your loads won’t always work to combat freight capacity issues, it’s a valid option for certain shipments. If you have a large LTL shipment that could benefit from truckload services, this could be a great back up choice. Using a dedicated truck can increase security, minimize damage, and expedite your transit.
While truckload moves typically consist of 8-10 pallets or more, some truckload carriers will offer a partial option where your load will share space with another shipper’s freight. This can add some perks of truckload shipping like added security, while benefitting from a more competitive price than paying for the entire truck. It’s important to note, however, that in partial truckload shipping, it’s possible your shipment may encounter delays due to the other customer on board. Depending on the order of delivery, you may end up waiting on the first delivery location if they don’t have everything in order. Building in extra time is still a good tactic to take here, but knowing you have alternative freight service options for your larger shipments is good to know if you are in a crunch.
The less often you ship, the less you risk not finding a truck for your loads. By consolidating your freight shipments, you create an efficient way of both lowering costs and ensuring you have LTL truck coverage. It may take a bit of communication and working with your customers, but reworking replenishment schedules so that you’re shipping larger, less frequent loads can be a smart long-term strategy. Moving your shipping to off-peak periods, if possible, also takes extra stress off of a carrier network that is already stretched thin. This not only allows for increased truck availably, but it also helps you avoid seasonal closures that will affect your shipments.
When receiving inbound orders, collaborative distribution is also an option. Collaborative distribution combines vendor orders from different shippers at one common distribution center and channels them into a single-truck delivery. This option is a type of consolidation, but happens much earlier in the supply chain. Finding the balance between identifying which shipments can be consolidated over a more flexible length of time while meeting delivery deadlines and customer expectations is key.
Most shippers are familiar with the large, recognizable national freight carriers, but regional freight carriers can also be a great option for coverage. Regional carriers specialize in concentrated geographic areas, usually within state-lines or city locales. In addition to adding them as options within your existing freight network, there are important advantages to working with regional carriers. Regional carriers have in-depth knowledge and first-hand experience navigating these areas on a daily basis and can speak to potential challenges like traffic trends or limited access issues. While a national carrier may be unfamiliar with these hang-ups, a regional driver’s knowledge of the area means increased transparency with the shipper regarding these obstacles, so precautions can be taken.
Oftentimes, regional carriers charge less for the same services that national carriers do. Regional carriers don’t have delivery area surcharges and costs for liftgates and accessorial fees are lower. Because regional carriers travel shorter distances, expedited or guaranteed services are generally less expensive, as well.
Finally, because these are smaller companies, they tend to offer more personalized solutions that emphasize customer experience. Relationships with these carriers tend to be less transactional, and place importance on problem resolution and service. Adding a regional carrier to the pool is an underutilized and potentially game-changing way to ensure your LTL loads are getting covered.
Freight capacity is a challenge, and it’s not changing any time soon. The best thing that you can do is create a plan of action that tackles these challenges before you have freight waiting on the dock. Working with a 3PL like PartnerShip can help audit your current shipping procedures and identify areas of improvement that go beyond getting your loads covered. Contact our freight experts to help get your freight where it needs to go.
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- Expand your current network
10 Essential Freight FAQs for Smart Shipping
04/07/2021 — Jen Deming
No matter what you're moving, there are a few freight shipping fundamentals that you need to know in order to transport your load successfully. While the process seems straightforward, there are some challenges that can be anticipated by answering a few basic questions beforehand. We've compiled the essential questions that you need to be able to answer before you start shipping freight successfully.
What is the difference between freight and small package shipping?
While freight and small package shipping have some similarities, there are some major distinctions to keep in mind. Shipment size is the first recognizable difference between the two, with small package shipments being smaller, typically less than 150 lbs. Freight shipments consist of larger loads, often palletized, that range from one or two pieces to a dedicated truck. Differences in transit time, pricing structure, and driver service level are other major variables between the two transportation options. Knowing the details and requirements of your load can help determine which service makes the most sense for you.
What kind of packaging is best for my freight shipments?
Proper packaging is key in protecting the security of your shipments. Using the correct materials for the commodity you are moving can help deter damages and loss. When packing items into multiple boxes, avoid any excess space to limit shifting. Packaging materials like bubble wrap, foam cushioning, and packing peanuts can all help cushion your commodities. Freight shipments do best when boxes are palletized or packed securely into customized wooden crates. If you are shipping multiple items on a pallet, it’s important to shrink wrap them together in a uniform, structured stack to avoid damage or separation of items. Clear and correct labeling is important to get your shipments where they need to go accurately and in an efficient time frame.
When does it make sense to use LTL vs truckload?
Choosing to use either an LTL (less-than-truckload) freight or truckload service is often situational and can depend on the specific requirements of a shipment. LTL shipments are moved by carriers who group your loads together with other customers for delivery. Your shipment will be sharing space with other freight and will be handled at multiple terminals. Truckload shipments typically use a dedicated truck for your move, so you are paying for the entire space for the full length of the transit. LTL freight is a more cost-efficient option, and great for regular freight loads of a few pallets or more, with no hard deadlines. Truckload shipping gives you greater security and a faster transit, making it more ideal for large, high-value or fragile loads.
Do I need a guaranteed delivery date?
Getting your freight load delivery date guaranteed can be a tough endeavor, so arrival dates given at the time of booking your load are always estimated. Factors like weather, warehouse delays, traffic, and other variables make it difficult for a carrier to promise delivery on a certain date with standard freight services. Time-critical or expedited services are a viable option for shipments that must arrive quickly by a certain time of day, day of the week, or other specific delivery window. It’s important to note, however, that even when electing to use these premium services, situations may arise that can cause a delay where a carrier will not be liable.
What is an accessorial fee?
Freight carriers use additional charges to compensate for any extra time and effort it takes to move a shipment, called accessorial fees. Any challenges with loading and moving your freight such as an oversized shipment, limited access at the point of delivery, or specialized equipment needs can drive up your freight bill. It’s important to note that every carrier charges different amounts for these fees, so knowing what services your shipment requires before pickup will help avoid any surprises.
What do I do if my freight is damaged?
As frustrating as the experience can be, freight damage or loss is almost inevitable if you ship regularly. The cost of repairs and replacements can be compensated by the carrier in these circumstances, but there are very specific steps smart shippers must take to ensure approval and payouts. Damage prevention is always the smartest tactic, so proper packaging is a great place to start. Making sure your paperwork is in order, checking for hidden damages, and filing your claim in a timely manner are all important steps to ensure your claim is resolved in your favor.
What is a freight class?
Many factors go into determining a rate for a freight shipment, and freight class is one of the most important. Every type of commodity that moves through the freight network is assigned a universal classification code by the NMFTA. These numbers are determined by four main factors: density, stowability, handling, and liability. Generally, the more difficult or challenging a commodity is to move, the higher the freight class. These qualities, combined with the length of haul, fuel costs, and extra services, determine your final freight rate. Classification can be confusing to get right, but freight experts can help decide which works is most accurate for your load.
What is density-based freight?
As more freight enters the network, and capacity continues to be limited, carriers struggle to keep up with available loads. Ideal freight shipments are solid, heavy, and take up minimal space within the truck, allowing more room for additional loads. Lightweight, awkwardly-shaped loads that don’t allow for an efficient use of space are subject to density-based rates. The shipment density, combined with freight class, will give you your total freight rate, which tends to be higher than low-density, easy-to-move shipments.How can I lower my shipping costs?A smart start for lowering operating costs is by taking a good look at your shipping practices. While there are some uncontrollable variables that factor into shipping costs, there are a few places you can better optimize your strategy for more savings. Improving your packaging, cultivating a strong relationship with your carriers, and maintaining reliable communication with your customers create great opportunities to lower your costs. Working with a quality 3PL can also help identify key areas where you may be able to save money with less effort on your end.How can a 3PL help my shipping operations?Working with a 3PL is a great way to gain resources and improve efficiency. Working with freight experts who are also familiar with the unique needs of your business can decrease the amount of time you spend on finding ways to cut costs. A 3PL like PartnerShip can also expand your network of carriers, ensuring your freight moves are covered quickly with reliable carriers, often with competitive rates that aren’t available to most businesses on their own.While these are some of the most common questions we receive at PartnerShip, they aren’t the only ones we hear from our customers. If you have a freight dilemma that you’re not sure how to resolve, contact the experts at PartnerShip and we will find the best answers for your business.
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5 Painless Ways to Save on Freight
03/12/2021 — Jen Deming
Everybody wants to lower their business operating costs, but nobody wants to spend a lot of time doing it. Decreasing your shipping spend is a good place to start, and there are five painless ways shippers can keep their freight costs low. From auditing your current carriers to tightening up your packaging practices, we break down simple ways to spend less on freight using minimal effort while gaining maximum payoff.
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Common Accessorial Fees Explained
02/24/2021 — Leah Palnik
No one likes surprise fees. Unfortunately, there are quite a few extra costs that are likely to pop up with LTL freight. Known as accessorial fees, these charges cover a wide variety of extra services and can add up fast.
What are accessorial fees?
An accessorial fee is a charge for services performed by the carrier that are considered to be beyond the standard pickup and delivery. These fees make up just one part of your freight rate, but can be challenging to manage. Understanding which accessorial charges you can plan for and which ones you can avoid is necessary if you want to keep your freight costs in check.
What are some common LTL accessorial charges?
You might be wondering what is considered an extra service, and you’re not alone. We’ve compiled some common LTL accessorial fees so you know what to look out for.
- Lift Gate Service
When the shipping or receiving address does not have a loading dock, manual loading or unloading is necessary. A lift gate is a platform at the back of certain trucks that can raise and lower a shipment from the ground to the truck. Having this feature on trucks requires additional investment by an LTL carrier, hence the additional fee.
- Inside Pick Up/Inside Delivery
If the driver is required to go inside (beyond the front door or loading dock) to pick up or deliver your shipment, instead of remaining at the dock or truck, additional fees will be charged because of the additional driver time needed for this service.
- Residential Service
Carriers define a business zone as a location that opens and closes to the public at set times every day. If you are a business located in a residential zone (among personal homes or dwellings), or are shipping to or from a residence, the carrier may charge an additional residential fee due to complexity in navigating these non-business areas.
- Collect On Delivery (COD)
A shipment for which the transportation provider is responsible for collecting the sale price of the goods shipped before delivery. The additional administration required for this type of shipment necessitates an additional fee to cover the carrier's cost.
Shipments containing articles greater than or equal to twelve feet in length. Since these shipments take up more floor space on the trailer, additional fees often apply.
- Fuel Surcharge
An extra charge imposed by the carriers due to the excessive costs for diesel gas. The charge is a percentage that is normally based upon the Diesel Fuel Index by the U.S. Energy Information Administration.
- Advance Notification
This fee is charged when the carrier is required to notify the consignee before making a delivery.
- Limited Access Pickup or Delivery
This fee covers the additional costs required to make pickups or deliveries at locations with limited access such as schools, military bases, prisons, or government buildings.
- Reweigh and Reclassification
Since weight and freight class determine shipment base rates, carriers want to make sure the information on the BOL is accurate. If the carrier inspects a shipment and it does not match what was listed, they will charge this fee along with the difference.
Navigating the many nuances of LTL freight accessorial fees to determine which services you need and which you can avoid will help ensure the most cost effective price. Carriers generally publish a document called the "Rules Tariff 100" which provides a list of current accessorial services and fees. The shipping experts at PartnerShip are well versed in these documents and are happy to help with any questions you may have.
Want a more in-depth look into freight accessorial fees and how to avoid or offset the added costs? Check out our free white paper!
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- Lift Gate Service
Why It's Never a Good Idea to Fudge Your Freight Dimensions
01/12/2021 — Jen Deming
While constancy isn’t something you can always expect in the freight industry, there are a few steady trends we’ve seen in recent years: less truck availability, an oversaturated network, and rate increases. Both sides are using tactics to offset these variables. Carriers increase fees, and in response, shippers explore means to cut costs. A trend we’ve seen among novice and experienced shippers alike is either estimating or downright falsifying the freight dimensions and weight of their LTL shipments. But, we’re here to tell you that going either route is a risky maneuver that can have major fallout.
Incorrect dimensions can delay your shipment
Carriers have an entire arsenal of tools at their disposal that check for discrepancies in weight and freight dimensions. Once LTL shipments are picked up and the BOL (bill-of-lading) is tendered to the carrier, that paperwork serves as a legal document — a contract between the shipper and carrier. Because LTL shipments stop at multiple terminals while in transit, there is plenty of opportunity to get “caught” if your weight or freight dimensions stated on this document are incorrect. If a carrier suspects misrepresentation on a BOL, intentional or not, your shipment will be flagged for an audit and an inspection. This process takes some time and your shipment will be detained. Depending on the volume going through that particular terminal, it’s tough to say how long that could be. Your shipment delivery will likely be delayed or missed, which can be a disaster if it was a time-sensitive shipment or if it holds up other operations for you or your customer. It’s just not a good look.You could be subject to reweigh, reclass, and over-dimensional feesAs outlined specifically in each carrier’s rules tariff, freight rates are determined on a variety of variables. When it comes to weight, cost is often calculated on a per pound basis and a maximum “standard” shipment length. Intentionally underestimating weight and size in order to save money can be tempting. However, if the actual weight and length is determined to be more than stated on the provided BOL, the final cost will be adjusted to reflect that. But, how much can that really be, right? If you’re still thinking about estimating your freight dimensions, think again: fees associated with these inaccuracies can affect your bill twofold.Firstly, the audit and subsequent reweigh or measurement will incur an inspection fee. The standard inspection itself can cost anywhere from $20 to $50 for weight changes. According to their rules tariff, UPS Freight charges $25 for a reweigh. As for restricted lengths, the fee can vary greatly by carrier and is often calculated on a cost per foot basis. For example, UPS Freight charges $90 for “extreme length” LTL shipments that fall within 8-12 feet. Larger than that, but under 20 feet can cost you $125. Of course, it increases incrementally from there.Secondly, changes to your shipment details may affect your freight class, another important component of your freight rate. Some types of products are classed based on density breakdowns; a dimensionally-large but lightweight shipment can be expensive. If your weight is incorrect, your density and class may change significantly, which will affect the overall cost of your shipment. Combined with the initial fee, these two factors can ultimately tack on hundreds of dollars in unexpected fees alone — in fact, they may add up to more than the original cost of your load.False freight dimensions can lead to disappointing claim payoutsSo let’s talk about another worst-case scenario: your freight shipment is damaged or lost while in transit. It’s a daunting prospect, but unfortunately, a pretty common occurrence, especially as more freight enters the network. Most shippers know that in order to recoup losses, you can always file a claim with the carrier. But payouts can be complicated, and what many shippers don’t know is that a final claim payout can be majorly affected if the provided shipment details are inaccurate.Most carriers determine claim payouts on a dollar per pound basis, with heavier shipments receiving higher payouts. Even if your dimensional fudging makes it past the carrier unnoticed, a payout based on these inaccurate details may be much less than what you were hoping for. To make things even more complicated, certain classes of products aren’t covered at all. If the carrier does find out you inaccurately disclosed weight, dimensions, or other details, the claim can be completely denied.How to ensure you have accurate dimensions for your freightWhile it’s clearly not a great idea to guess or fabricate your freight dimensions, mistakes can also be made when you have the best intentions of providing the correct measurements. There are a few tips you should follow to ensure the details of your shipments are as accurate as possible.
Shippers are always going to be looking for ways to cut transportation expenses in order to improve their bottom line. While shipping costs may be a flexible area for that opportunity, fudging your freight dimensions to get there is both unethical and extremely risky. If you’re stuck on how to save, PartnerShip can help.Inaccurate freight dimensions is just one of the common slip-ups shippers make that have costly consequences. Check out our free guide on the top 5 most common mistakes to avoid so you can ship smarter.
- Invest in quality scales and other tools used within warehouses
- Audit and calibrate your measurement tools regularly
- If you aren’t able to acquire the proper equipment, use the manufacturer’s specs
- Don’t forget to add in weight and size measurements from packaging such as pallets, cartons, etc.
- Always calculate proper freight density
- If you are receiving the freight shipment but are responsible for the shipping costs, make sure those details are being calculated accurately
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The Life of Your LTL Shipment
08/13/2020 — Jen Deming
Are you familiar with the step-by-step process of an LTL freight shipment? There's much more involved than pick up and go. We broke down each checkpoint with important notes to remember, so you can keep tabs on the secret life of your load.
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Don't Fall for These Top 5 LTL Shipping Myths
07/29/2020 — Jen Deming
Whether you are an LTL newbie or seasoned pro, there's some common misconceptions about freight shipping that can impact your load, and most importantly, your costs. Don't take for granted that everything you know about LTL shipping is a fact. Learn more about the top five LTL shipping myths so you can ship smarter and dodge costly freight errors.
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The Truth About Limited Access Delivery Fees
06/22/2020 — Jen Deming
No one likes an expensive freight bill. With so many types of unexpected costs and hidden fees, shippers frequently end up with an invoice higher than they budgeted for. Limited access delivery fees are one of the most common billing discrepancies surprising both new and veteran shippers alike. So, why do carriers charge this fee and what can you do about it?
What is a limited access fee?
Simply put, a limited access fee is an extra charge passed on by the carrier for any shipment that, due to location, will take extra effort or time to navigate. This includes places that are difficult to get to, congested areas, or destinations that have strict security requirements. Limited access fees can vary by carrier and often show up as a flat rate or a per-hundredweight charge. Minimally, this charge will cost you at least $100 but could cost you upwards of $300.
What factors determine if a location is considered limited access?
One of the most frustrating things about a limited access delivery charge is that not every carrier defines the same locations as limited access. You may hire different carriers for the exact same load to the exact same delivery location and end up with two very different bills. To anticipate whether a location may incur this fee, a good rule of thumb is to always consider the driver's time and effort. If the area is going to delay the carrier or require extra effort, it's safe to say you'll get the charge. So, what variables influence an area's "limited access" status?
Not every delivery is going to be at a warehouse with an expansive lot and a spacious loading dock. Some locations are especially are especially difficult to access due to their physical layout. Many urban storefront locations, schools, or businesses are only accessible via narrow streets and alleyways, and this makes maneuverability extra difficult. Loading and staging requires space, and without a dock or even a back lot, this can be especially challenging. This extra effort and delay is going to result in a limited access fee.
Some locations are simply a pain for drivers to get to, so they are going to charge you for that hassle. Businesses located in congested areas like downtown in a city, fairs and carnivals, boardwalks and beaches, campsites, island resorts, or worksites like mining quarries and construction zones are going to incur charges. These types of places are challenging to maneuver a large truck through, so the carrier will have to find a specialized vehicle like a pup truck to make it through. In cities where traffic is unpredictable at best, one delivery can take up a large portion of the day. This delays business and prevents carriers from making additional deliveries. This wasted time and extra effort will cost you.
Disruption to business
Another type of limited access charge is one that has challenges related to business hours or the private nature of the location. These places may be easier to get to, but issues arise due to hours of service restrictions and operating staff. Typically, these are businesses that would be disrupted during regular operating hours, such as schools and universities, places of worship such as churches and temples, doctor's offices, assisted-living and retirement facilities, hotels, piers, farms, and ranches. These places must have a loading team ready, and if it's harder for a driver to get the load off of a truck because the staff are busy during regular business hours, you're going to see that extra charge.
Some places are a challenge to get to because of the extra effort and security required to make a delivery. Prisons, government facilities, and military bases all have proper procedures and protocols in place for incoming and outgoing deliveries for the sake of safety. This often means inspection check points, proof of identification, appointment for delivery, and more. Going through all of these hurdles is going to delay the driver, potentially holding up other deliveries that are left waiting on the truck. The inefficiency of extra effort and lost time requires carriers to implement limited access fees to recoup the cost of lost productivity.
How to avoid breaking the bank over limited access delivery fees
We've outlined some of the most common types of limited access delivery points, but it's extremely important to understand these aren't the only ones. The best line of defense to combat limited access delivery fees is to do some groundwork and research before shipping to any type of unfamiliar facility. That way, you can better prepare for those charges and build that into your freight quote if need be. To ensure the best possible outcome for your freight invoice:
Limited access delivery fees are an unwelcome surprise that no one wants to see on their final freight bill. Brushing up on what may trip you up is the first step in knowing how to offset this common accessorial. Building an expert shipping team is your next move. PartnerShip can help you navigate hidden charges and can provide you with options to help you save on limited access delivery fees.
- Communicate with your consignee (delivery location) in order to learn from their past experiences. Find out whether they have a dock, a team, shipping/receiving hours, and any limited access fees they may have been targeted with in the past.
- Do your own research to validate that information. Google Maps is a useful tool that many freight professionals use to glean information. It can't tell you everything, but it can shed light on general terrain and many of the logistical challenges drivers will be dealing with.
- Gain insight into what the security processes of every delivery location may look like. It's not just military locations or prisons that require identification or load inspections. The more you know on the front-side of a delivery, the less you will be surprised by delays and charges.
- Call the carrier you plan on using and learn from them directly what locations will incur extra charges. National freight carriers like UPS Freight and YRC Freight list their rules tariffs on websites, so be sure to research these for precise calculations of charges and fees.
- When in doubt, work with a knowledgeable freight partner who can answer your questions and do the legwork for you and offset any surprises. A freight broker can help determine alternate carrier options with reliable service and lower limited access fees to better meet your budget.
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Logistics and Legal Rights: Where Do Shippers Stand?
01/23/2020 — Jen Deming
Every shipper will likely encounter loss or damage and seek reimbursement by filing a claim. In order to navigate this tricky scenario, smart shippers become their own advocates by taking a deep dive into the legal policies that affect shipper's rights and responsibilities. When going against powerhouse national carriers who have every resource in their corner, you can arm yourself with critical information that helps you get the best outcome possible for your business.
The Carmack Amendment Basics
First things first, the term "Carmack Amendment" is frequently thrown around in the industry, but what exactly is it and why should shippers care? Put simply, this law was set in place in 1935 to draw the line between carrier and shipper liability. Prior to that, with the Bill of Lading (BOL) serving as a legal contract of carriage, carriers were almost exclusively held responsible for damage or loss. With the passage of the amendment, it was determined that the carrier should be held responsible unless one of the outline exclusions is met. This change let to a positive impact on the industry, incentivizing both carriers to proactively prevent theft and shippers to more effectively prepare their freight.
5 Carrier Exclusions to Responsibility
The Carmack Amendment clearly outlines five specific instances in which a carrier is not to be held liable for damage, delay, or loss to freight. These events are intended to protect the carrier from circumstances outside of their control. The five are:
- Acts of God: A carrier cannot be held liable for instances of natural disasters or other uncontrollable phenomenon such as severe weather, medical emergencies involving a driver, etc. In order to act under this defense, the event must be notably unanticipated and unable to be avoided.
- Public Enemy: Carriers are exempt from damage liability if the incident was caused during a defensive call to action by the government, or "military force". While there has been relative peacetime on American soil for quite some time, the "public enemy" defense has also applied to acts of domestic terrorism in some recent court cases. It does not include events caused by hijackers, cargo theft, organized crime, or other criminal acts.
- Default of Shipper: This is the most notable exclusion for shippers to be mindful of and indicates any event that the carrier can prove damage was caused by the shipper. This can include a defense of negligence, poor packaging, improper labeling and other mistakes made during preparation. The majority of carriers will try to prove these circumstances if there is any doubt a shipper could have made a mistake. Shippers must properly offset this risk with secure packaging, correct labeling, and maintaining communication with your customer for delivery.
- Public Authority: If the government takes action that results in damage or delay, the carrier is not liable. Government policy cannot be controlled, so road closures, trade embargoes, recalls, and quarantines all exempt a carrier.
- Inherent Vice/Nature of Goods: Some commodities are naturally subject to deterioration over time, and as long as the defect was not caused or sped up by the carrier negligence, they are safe from liability. A common example of high-risk commodities include produce, live plants, and medical supplies. If you are shipping temperature controlled or time sensitive products, be sure that you are taking every precaution to ensure security and viability.
Just as there are five distinct factors that exclude carriers from responsibility, there are three factors the shipper must prove in order to start a damage claim. To begin, it must be demonstrated that the shipment was picked up in "good" condition. This protects the carrier should the shipment have been damaged to begin with. In order to defend yourself, take pictures of your freight before it is picked up proving all is well. Collect invoices, product descriptions, and item counts so that you have a leg to stand on in the case of any loss or shortage.
Secondly, the shipper must prove that the load was delivered in damaged condition. Complete a thorough inspection before you sign and again, take pictures of everything for proof. Concealed damage, hidden and only discovered after the carrier has left, is a tricky area for claims. Open and dismantle your packaging at delivery to check for issues, and don't feel bad for delaying a driver. If there is any doubt at all, make a note on the delivery receipt. If you are not present for delivery, make sure clear expectations are established with the receiver or customer so that everyone is on the same page.
Lastly, the shipper has to prove that the freight damage resulted in a specific amount of loss. It won't work to throw an arbitrary number in a freight claim, so collect itemized receipts and quotes or bills for replacement or repair costs. Be reasonable and accurate in your request.
Fair Compensation Rights for Shippers
Even if the shipper does everything right, claim payouts are rare what would would expect. Carriers do everything in their power to minimize financial losses, so they will look at every loophole possible. So how does a carrier determine a claim payout?
The amount is typically determine by a set dollar amount per pound based on the commodity. It's important to review carrier tariffs and agreement limits before you ship your product. Some carriers will pay nothing on a used item, so be sure to review the fine print. It's also critical to have an accurate BOL. If there are incorrect details, you're likely to see that reflected in your payout. It's also important to note that a carrier claims department will examine the damage, and limit a payout if they feel the product can be salvaged or repaired at a lesser amount than what is requested.
Since carrier liability is limited, a smart shipper will obtain supplementary freight insurance. It's a super smart option for anyone shipping fragile goods or a high value commodity. While most carrier liability only pays out a certain dollar amount per pound of freight, freight insurance can be purchased in the value of coverage you need, and you are not required to prove the carrier is at fault.
It's important to note carrier compensation timelines for payouts. A carrier should acknowledge receipt of the claim within 30 days, with a ruling completed within 120 days. In the event of a denied claim ruling, the shipper has a right to file a lawsuit. Most need to be filed within 2 years and one day, but there are exceptions so it's best to work quickly.
Shipper's Requirements for Proper Claim Filing
It's up to the shipper to follow a precise protocol in filing a claim to increase their chances of a suitable resolution. Collecting as much hard evidence as possible will help your case. Seeking written statements by warehouse receivers and testimonies of loading procedures, as well as video evidence can assist your cause. Being thorough is crucial but working quickly is just as important, so be mindful of deadlines. You have nine months from the delivery date to file, but for those concealed damage cases, you have five days—so get on it.
Documentation you may need to file:
- Proof of delivery
- Original BOL
- Freight bill
- Merchandise invoice
- Replacement invoice or repair bill
- Pictures of damaged freight
Knowing the basics of the Carmack Amendment and how they relate to shipper's rights helps protect your business in the event of damaged or lost freight. the best part is, you don't have to go through the claims process alone. Working with PartnerShip can ensure you have an informed ally looking out for your best interests and your company's bottom line. For a thorough rundown on freight claims, download our free white paper.
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What is the Difference Between Cross-Docking and Transloading?
01/14/2020 — Jerry Spelic
They are common questions in logistics and warehousing: What is cross-docking? What is transloading? What is the difference between cross-docking and transloading?
First, a definition of each of these freight services.
Cross-docking is unloading inbound freight from one truck, holding it in a warehouse or terminal for a very short period of time, and loading it onto another truck for outbound shipping.
Transloading is when inbound freight is unloaded, the pallets are broken down, and their contents sorted and re-palletized for outbound shipping.
Here is an example of cross-docking: A manufacturer needs to ship 20 pallets of products from the east coast to destinations in Texas, Florida and California. The 20 pallets are first shipped to a third-party warehouse in Cleveland, Ohio. A day later, 5 pallets are sent to Florida, 10 to Texas, and 5 to California on trucks bound for those destinations. Since the pallets were never unpacked and were only in the warehouse long enough to move them from one truck to another truck (and from one dock to another dock), they have been cross-docked.
Using the same Cleveland, Ohio third-party warehouse, here is an example of transloading: 5 suppliers of a manufacturer ship a year’s supply of components to the warehouse. The components are stored until they are needed, at which time the warehouse picks them, assembles them into a single shipment, and ships it to the manufacturing facility.
To recap, cross-docking is the movement of an intact pallet (or pallets) from one truck to another, and transloading is the sorting and re-palletizing of items.
Both cross-docking and transloading services are specific logistics activities that can create benefits for businesses; especially ones that utilize a third-party warehouse.
Benefits of cross-docking
- Transportation costs can be reduced by consolidating multiple, smaller LTL shipments into larger, full truckload shipments.
- Inventory management is simplified because cross-docking decreases the need to keep large amounts of goods in stock.
- Damage and theft risks are reduced with lower inventory levels.
- With a decreased need for storage and handling of goods, businesses can focus their resources on what they do best instead of tying them up in building and maintaining a warehouse.
- Businesses can store goods and products near customers or production facilities and have them shipped out with other goods and products, decreasing shipping costs.
- Businesses can ship full truckloads to a third-party warehouse instead of many smaller LTL shipments.
- With storage and logistics managed by others, the need for building and maintaining a warehouse is eliminated.
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Beyond Boxes and Pallets: 10 Other Ways to Move Freight
01/03/2020 — Jerry Spelic
When most people think of freight, it’s usually an image of the ubiquitous 40” x 48” wood pallet that comes to mind. But there are many other ways to move freight, including these lesser known, but still important, methods.
Pallets. They are so important to freight shipping that even though we’ve covered pallets in depth before, we can’t not mention them here.
In addition to wood, pallets can be made of plastic or metal. Plastic pallets are popular for export shipments because they don’t have to be heat treated to be used for international shipping, like wood pallets do. Aluminum and stainless steel pallets are strong and lightweight, and since they can be cleaned and sanitized, they can be used in food processing and pharmaceutical plants, where cleanliness is essential.
Gaylords. Named after the company that first introduced them, Gaylords are pallet-sized corrugated boxes used for storage and shipping. Sometimes called pallet boxes, bulk boxes, skid boxes and pallet containers, Gaylords can have between 2 and 5 walls and are meant to be single-use containers. Frequently used as in-store displays as well as shipping containers, Gaylords can be used to ship items as diverse as watermelons, stuffed animals, and pillows. Depending on configuration and how many walls they have, Gaylords can hold from 500 to 5000 pounds each.
Metal bins. Metal bins are typically made of steel and are mainly used in industrial applications where strong-sided containers are required to hold and move heavy and irregularly shaped items, like metal castings and forgings, stampings and scrap metal. Metal bins can be found in many different sizes and are essential in safely shipping heavy and potentially sharp objects.