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Tag: multimodal

LTL 101:Billing

Posted 7 years ago

LTL 101: Billing Accuracy

Many shippers have expressed concern about accuracy of LTL carrier’s billing practices. Having pushed the LTL carriers to be more vigilant with making corrections for weight and other aspects of shipments for proper revenue capture, SJ Consulting researched the validity of such perception by conducting an extensive survey with several large LTL shippers, 3PLs, and freight audit and pay firms, with particular thanks to Williams & Associates. The freight charges on LTL shipments by these companies exceed $8 billion over a 12­ month period, representing 22 percent of the total industry revenue. For decades, the LTL industry has relied on an honor system for shippers to provide true characteristics of their shipments, required to accurately bill the customers for their shipments.

The survey found the range of billing accuracy was 94 to 99 percent depending on the carrier, with the average being 97 percent. The most interesting revelation of the survey was that what shippers perceive as a billing error actually is due to shippers providing an estimated weight or freight class for dimensional attributes of their shipment that are corrected on more shipments as more LTL carriers deploy scales and dimensional machines. Given that about 50% of bills of lading have errors in weight or description of the shipment, it’s no surprise that a correct invoice from a LTL carrier can get perceived as a billing error.

Despite shippers’ perception, the LTL industry has an impressive record in billing accuracy, and it is finally converting rapidly from an honor system.

 

Check back every 2nd and 4th Wednesday each month for more inside information on LTL through our Multimodal Wednesday Series.

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LTL 101:PODs and Additional Services Charges

Posted 7 years ago

LTL 101: PODs and Additional Services Charges

The last blog discussed educating shippers to ensure the BOL is set up correctly and to avoid a possible dispute with the carrier regarding the invoice. This week is discussing educating consignees so they know what to expect at the time of delivery.

It is very important to educate your consignee BEFORE the freight is delivered about what the process will be like. Will they need a liftgate? Will the driver be helping unload the freight in any form or manner? By asking these questions in advance, and by making sure that you are on the same page as the consignee, you can minimize additional charges on the invoice.

On the delivery receipt/proof of delivery (POD), issues should be noted if you suspect that the value of the product has been compromised. Make sure to note any damage to the packaging, and/or missing product. Having these notes on the POD makes it easier to file a freight claim with the carrier if necessary.

Another tactic you can take is refusing a shipment if there is damage; this means that the consignee does not accept the freight in the condition presented – meaning you will eventually file a damage claim. This will alert the carrier that something is wrong with the shipment and that they should get in touch with the appropriate party. Make sure you use this tactic responsibly and honestly, because if a shipment is not damaged the carrier can tack on a redelivery fee. Yikes!
Five of the most common additional services on a POD include:

  1. Lift Gate – Hydraulic lift on the rear of a truck used to assist in the unloading of freight.
  2. Inside Delivery – The driver is only responsible for moving the freight off the truck. If the driver helps move the freight more than a few feet away from the truck, even if it’s not “inside,” then an Inside Delivery fee may apply. Be very careful with this one because the terminology can be misleading and it varies by carrier.
  3. Limited Access (Residential) – This is up to the carrier’s discretion, however, there are locations that will always be deemed limited access.
  4. Sort/Segregate – Certain locations may require a carrier to sort and segregate a shipment. This is additional handling beyond the normal duties of a driver that will incur additional fee(s).
  5. Detention – With most LTL carriers, the first 30 minutes from when the driver arrives are free. Any additional time is subject to an additional detention fee.

 

So the next time you sign a POD when receiving your shipment, be sure to review it and see if any additional services listed are being used. Services can be pre-printed or added to the POD by a driver, and the additional charges may vary. In some cases, it may be good practice to have your consignee obtain a copy of the POD themselves.

 

Check back every 2nd and 4th Wednesday each month for more inside information on LTL through our Multimodal Wednesday Series.

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Intermodal 101:Door to Door Rail

Posted 7 years ago

Intermodal 101: Door to Door Rail

For people who have not shipped via Intermodal in the past, utilizing rail controlled, door to door offerings can be an effective way to familiarize yourself with it.

Typically, an Intermodal shipment requires coordination of a drayman to handle the pickup, a railroad to move the shipment from origin ramp to destination ramp and another drayman to handle the delivery to the consignee.  This type of shipping usually results in an affordable transportation option for the shipper, though it can be daunting for a shipper. If the shipper lacks experience, coordinating these pieces can feel too risky to justify adding intermodal into their shipping process. In this case, the railroads have another option.

One of the options a shipper might utilize is “Door to Door” shipping on the railroads.  This option allows a shipper some of the advantages of shipping Intermodal, but the rail company is responsible for coordinating the details. The shipper is responsible for dispatching one party, the same as they do for an over-the- road (OTR) shipment.  There are several reasons that a shipper might find this advantageous.

First, the shippers’ operational system already allows them to set up a shipment with one carrier and one party to pay. A “Door to Door” shipment with the rail is a natural fit for that system, because it is only one party to pay.

Secondly, using “Door to Door” simplifies the monitoring of authority and insurance requirements to one party.

Finally, “Door to Door” reduces complications in accessing intermodal equipment, as the railroads have access to empty equipment from loads moving into the area a shipper is looking to ship from.

In the next installment, we will discuss more of the benefits and drawbacks of using the railroad “Door to Door” products.

 

Check in on the 1st and 3rd Wednesday of every month for more information on intermodal and how it can benefit you!

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