Section I: Introduction
Logistics and freight transportation can often seem daunting, not least due to the wide variety of terms and jargon. Among the most commonly misunderstood are accessorial charges. Accessorial charges (often called simply accessorials) are additional fees carriers charge for services extending beyond standard pick-up and delivery. These may include waiting times, lift-gate services, residential pickups, and many others. The widespread confusion and sometimes dissatisfaction associated with these charges stem from billing discrepancies and a lack of understanding about the nature and applicability of these charges. However, by gaining a comprehensive understanding of potential extra costs, shippers can better manage their budgets and avoid unexpected expenses.
For carriers, these fees serve as a means of compensation for the extra services and resources required in the course of transportation. They reflect the complexity and dynamism of freight transportation market dynamics, helping to balance supply and demand, and ensuring the sustainability of carrier operations. For shippers, however, these fees can lead to increased costs. Thus, understanding these charges is vital in fostering a more efficient, transparent, and equitable partnerships between carriers and the shippers for which they haul.
This guide is your one-stop shop for all things accessorials specific to LTL (less than truckload). While all modes can result in accessorial fees, LTL is even more likely to incur additional charges due to its high-touch nature. By using this guide, shippers can proactively prepare for potential accessorials and mitigate the sticker shock when these services are called for.
Section II: Intro to LTL Accessorial Fees
Though accessorials are also prevalent in full truckload shipping, they are particularly prominent in LTL and often non-negotiable. But – why?
The answer lies in the unique LTL carrier business model. LTL carriers operate dense freight networks, moving shipments across multiple facilities from origin to destination. Staying profitable and keeping shipping costs low requires efficient management, with carriers making numerous stops per day for pick-ups and deliveries. The intricate nature of managing such fleets makes LTL carriers especially vulnerable to any factors that might decrease their efficiency and disrupt their schedules.
Armed with robust operational data from their fleet, LTL carriers can accurately calculate the cost of each delay. Time equates to money for these carriers, and they won't hesitate to impose charges for any factors hindering freight's smooth movement through their network. If your LTL freight demands any non-standard operational needs, whether pre-planned or unplanned, carriers will balance the additional operational expense by imposing an accessorial charge.
Are accessorials a negative aspect of LTL shipping? Not necessarily. While certain accessorial fees may arise from shipper errors, such as reclassification or reconsignment, they can mostly be seen as a way of aligning your requirements with your carrier for successful, on-time, and damage-free freight delivery. Accessorials help LTL carriers deliver the customized services your freight requires.
Transparent communication about these needs upfront can help your carrier maneuver your shipments without any unexpected or costly hiccups.
The charges for specific accessorials can vary among carriers. For instance, a carrier with more lift gates in their fleet might charge less for lift gate services but impose higher charges for private residence deliveries. It all depends on their resources and willingness to perform certain services.
LTL-Specific Accessorial Fees
The fees outlined below are general guidelines based on our experience and are not definitive. Your carrier should be able to provide upfront information about the fees for the specific services you require. If you're booking through a third-party logistics company (3PL), they should also be able to furnish this information about the carriers in their network.
After-Hours Fee
This fee is charged when pickup or delivery occurs outside regular business hours, usually 8 a.m. to 5 p.m. After-hours fees are often incurred with delivery appointment fees when the appointment falls outside of designated business hours.
Convention, Exhibition, and Tradeshow
This accessorial will apply when a shipment is delivered to or picked up from a convention center, exhibition, or tradeshow. Remember that these events could be paired with other accessorials, including limited access, delivery appointment, and/or liftgate.
Detention
Carriers loathe waiting longer than usual for a shipment to be loaded or unloaded. Given the nature of LTL shipping, idle time waiting at one location creates a domino effect that alters scheduled shipments further down the route. Detention fees are designed to compensate for this downtime. This fee can vary by carrier; in some cases, it escalates with every 15 minutes of waiting time.
Inside Delivery or Pickup Fee
This fee will be charged when a shipment is inaccessible from the dock or loading area, or when a driver is required to bring freight inside at delivery or retrieve it from inside a pickup. This is often added at the point of delivery because the receiver does not realize it is a chargeable service.
Liftgate
This is common LTL delivery for small businesses, restaurants, residences, or other locations that do not have a loading dock. Liftgates are electric or hydraulic platforms at the back of a trailer that allow freight to be lowered or raised from the ground. Not all trucks come equipped with a liftgate, so it is imperative to signify at booking when it is needed so carriers can route trucks appropriately.
Limited Access
This fee is charged when pick-up or delivery occurs at a consumer location, a difficult area to maneuver, or a protected area. Examples include schools, churches, government buildings, storage facilities, and construction sites. These locations are usually time-consuming, as parking a truck and figuring out where and how to unload freight can be difficult. This is often charged with inside delivery, liftgate, and/or notify before delivery.
Notify Before Delivery and Delivery Appointment Fees
LTL carriers prefer open delivery windows because it allows the most flexibility to route LTL deliveries based on location optimally. Delivery appointment and notification requirements put additional pressure on the carrier and can substantially slow delivery processes, so they come with additional charges. Notify before delivery indicates that the receiver needs to be called before arrival and is often used for residential or other non-staffed facilities. While the phone call itself is not burdensome, if the receiver cannot be reached, these shipments can result in significant delays or additional redelivery fees.
Delivery appointments are strict appointment times that must be made in advance and are common with many big box retailers, grocers, and distribution centers. Also, note these facilities are notorious for lengthy waiting and unloading times. Some LTL carriers will not accept freight into them — so confirm at booking that they can support both the delivery appointment and the specific delivery location.
Redelivery
When a delivery is unsuccessful on the first try, it will incur redelivery fees. Usually, this happens if there is no one at a facility to receive the shipment, if the receiver cannot be notified as instructed, or if there is too much congestion at a facility. Redelivery may be attempted later in the same day, or the freight may roll to the next day’s schedule.
Residential Delivery or Pickup Fee
This fee is charged when a delivery or pickup is requested at a residential address, which is challenging because it often requires smaller trucks to navigate narrow residential streets. LTL residential delivery has become a prevalent issue in today’s direct-to-consumer market.
Bill of Lading (BOL) Correction Fee
The Bill of Lading (BOL) Correction Fee is typically applied when amendments are required during transit after a BOL has been issued. These changes can cause disruptions in the logistical process, adding time and complexity, which necessitates the additional fee. Carefully reviewing all the details on the BOL, preferably with an LTL expert, before it is submitted can ensure accuracy and help shippers avoid these fees.
Oversized Freight Charges
Oversized Freight Charges become relevant when shipments exceed standard dimensions, typically beyond 8 feet in any direction. However, these dimensions can vary between carriers due to the consolidation method of LTL shipping. Managing such oversized freight in LTL is a complex task, as these larger items disrupt load planning, take up more trailer space, and potentially displace other cargo, leading to reduced load efficiency. Moreover, carriers must meticulously plan their freight loading and unloading sequences to accommodate oversized shipments. Mismanagement can result in unproductive space usage in the truck and disrupted delivery schedules. Oversized Freight Charges compensate for the additional complexities and resource requirements involved in transporting larger-than-standard shipments by LTL standards.
Hazardous Cargo Fee
When shipments involve the transportation of hazardous materials, a fee occurs. Due to their properties, these shipments pose a potential threat to public safety or the environment. They require careful handling and adherence to specific safety protocols to mitigate the risks involved. These materials cover nine hazard classes, from corrosive chemicals and flammable liquids to radioactive substances and biological hazards. Transporting them goes beyond the realm of standard freight handling, calling for specialized equipment, training, and procedures, thereby incurring additional costs reflected in the Hazardous Cargo Fee.
Accurate quoting of this fee relies heavily on comprehensive information disclosure by the shipper. It is the shipper's responsibility to declare the presence of any hazardous materials in their shipment clearly and provide all necessary details about the material type, quantity, and safety measures required. This includes the material's nature, the associated hazard class, the packing group, the identification number, and emergency contact information, as outlined in the relevant shipping documents. Providing accurate and detailed information upfront is vital to appropriately handling hazardous materials and averting any potential regulatory violations or safety breaches.
Protect from Freeze Fee
Managing commodities that cannot withstand freezing conditions presents unique challenges. Unlike full truckloads, where a single product’s temperature requirements can be catered to, LTL shipments carry a mix of products, each with potentially different handling needs. Among these could be products like specific chemicals, food items, or paints, which risk damage if they freeze.
Carriers must employ specific strategies and equipment to protect such items from freezing, incurring an additional fee called the Protect from Freeze Fee. They might use heated trailers or insulation blankets for temperature control, or shipments may be strategically placed within the trailer to leverage the warmth from the truck's engine. Moreover, because these shipments may need to be kept separate from other cargo, there's an added layer of complexity in load planning and routing to ensure all shipments' safe and timely delivery.
Weight and Inspection Fees
In LTL, where diverse consignments are consolidated into a single vehicle, precise weight data is particularly crucial. Misdeclarations not only affect that specific shipment's handling but can also disrupt the entire shipment’s balance and planning. If a shipment's actual weight significantly deviates from what was initially reported, it might affect the vehicle's weight distribution, potentially posing safety risks and affecting fuel efficiency. Similarly, if the contents aren't accurately declared, carriers could face challenges in correctly placing the goods in the vehicle to prevent damage.
Carriers may need to reweigh or inspect the shipment to manage this, resulting in Weight and Inspection Fees. The administrative work, labor, and time spent on these additional verification steps drive these costs. Consequently, shippers who provide accurate information upfront can avoid these unnecessary expenses and contribute to smoother and more efficient LTL operations.
Reweigh and Reclassification Fees
Reweigh and Reclassification Fees occur when a shipment's declared weight or freight class doesn't align with the actual parameters. Given the nature of LTL, where different consignments share space, any misrepresentation can disrupt the cargo placement strategy, affecting the carrier's efficiency and the safety of all shipments involved. Freight class adjustments can impact the cost, as freight charges in LTL shipping are often based on freight classification. To avoid these fees, shippers must provide accurate information upfront.
Section III. Common Truckload Accessorial Fees
Though more common in LTL, full truckload is no stranger to accessorial fees. Like in LTL, certain carriers will charge different fees. However, the industry stance for full truckload is generally more universally agreed upon.
Truckload-Specific Accessorial Fees
When it comes to full truckloads, accessorial fees are more frequently associated with disruptions that prolong the truck's stay at pickup or delivery locations, such as detention or layover fees, or the need for supplementary services like driver assistance or additional equipment. This variation underscores the importance of understanding the specificities of your shipping mode when managing and budgeting for these extra costs.
Detention
Carriers are eligible for Detention Fees when a truck is held beyond the agreed-upon time at the shipper or receiver's facility for loading or unloading. With both powered (driver and truck) and unpowered (trailer only) detention, the critical factor is time. The average costs can vary widely by carrier. Minimizing these charges often involves efficient coordination and communication with the carrier about loading and unloading schedules, and preparing goods in advance for swift loading and unloading.
For carriers to be paid out on detention, it’s critical that they clock their arrival and departure times via technology and/or with a dock worker from the relevant location (pick-up or delivery). Being able to prove their presence is imperative.
Layover
Layover fees are requested when a driver is forced to wait overnight or for an extended period between scheduled pick-ups or deliveries. These fees compensate the carrier for the lost opportunity to use the driver and truck during that time. Costs can vary, and examples might include a truck scheduled to pick up a load late in the day, but the load isn't ready until the next morning. Minimizing layover risks involves precise scheduling and ensuring that loads are ready for pick-up as planned.
Driver Assist
Driver Assist fees can be requested if a driver is asked or required to do more than the usual pick-up and delivery, like helping to physically load or unload the truck. Having clear agreements in place about the driver's responsibilities can help avoid unexpected charges and ensure only carriers (specifically drivers) capable of the work are assigned to the shipments requiring this additional attention.
TONU (Truck Order Not Used)
TONU charges are applicable when a truck is dispatched to a location but is not utilized for the intended purpose. This can occur if a shipment is canceled or rescheduled without sufficient notice, resulting in the carrier incurring expenses, including driver wages or fuel. TONU fees help offset these expenses and encourage accurate planning and communication between the shipper and carrier to minimize disruptions.
Diversion Miles/Additional Stops
Diversion miles or additional stop charges are incurred when a route needs to be altered, or additional stops are requested after the initial agreement. These charges compensate the carrier for the extra distance traveled and the additional time and resources required to accommodate the changes.
Extra Equipment Charges
Extra equipment charges may apply if specialized equipment is needed to transport certain goods. This can include equipment such as refrigerated trailers, flatbeds, or liftgates. These charges cover the additional cost of providing and maintaining the unplanned specialized equipment. Clearly communicating the equipment requirements during the booking process helps ensure accurate pricing and the availability of the necessary equipment.
Event Shipments
Event shipments refer to transportation services specifically tailored for events, such as trade shows, exhibitions, or concerts. These shipments often require careful coordination, strict timelines due to limited dock space and event scheduling, and specialized handling. Event shipment fees account for the unique logistical requirements and operational complexities associated with these types of shipments. Working closely with the carrier and providing comprehensive information about the event's logistics can help ensure a smooth and successful transportation experience.
Gain Access to Accessorial Expertise With Wicker Park Logistics
Accessorial expertise is crucial in anticipating and effectively managing these additional charges.
At American Group, we pride ourselves on our deep understanding of accessorial fees and their implications. Our experienced team excels in accurately assessing the unique requirements of each shipment, allowing us to proactively identify potential accessorial charges and develop strategic solutions to mitigate them.
With Wicker Park Logistics as your logistics partner, you can trust that we will anticipate your needs and take proactive measures to minimize accessorial fees wherever possible. Our reputation in the industry is built on our commitment to providing tailored and cost-effective solutions to our clients.
If you're ready to leverage our accessorial expertise and ensure smooth logistics operations while optimizing your budget, we encourage you to reach out to Wicker Park Logistics for a consultation. Let us show you how our comprehensive understanding of accessorial fees can significantly impact your supply chain management.
