What Are Accessorial Charges and How to Manage Them

Logistics often brings its share of hidden costs, and accessorial charges are a common surprise. These extra fees go beyond the basic freight services, catching many businesses off guard. These are fees for services that go beyond the basic pickup and delivery typically included in freight quotes. Understanding these charges is crucial for businesses to budget accurately and avoid unexpected expenses.

What Are Accessorial Charges?

Accessorial charges in logistics are fees that carriers charge for services beyond the standard transportation of goods. These services can include packing, loading, unloading, and delivery to specific locations within a facility. Once assessed, freight accessorial fees are typically included on the shipper’s initial invoice. However, it’s also common for these charges to be applied at the time of billing. While accessorial fees frequently accompany less than truckload (LTL) shipments, they can apply to various other shipping types as well.

Reasons for Freight Accessorial Fees

Accessorial charges are often predictable and can be included on the initial invoice. The common reasons for these fees include:

Additional Distance and Time: Shipments frequently require more time to reach their destination or may necessitate extra stops. These delays can accumulate additional accessorial fees.

Special Handling or Equipment: Certain deliveries require specific handling or equipment for loading and unloading containers. For example, a liftgate may be necessary for locations without loading docks, contributing to the accessorial charges.

Special Permits and Escorts: Oversized or overweight loads often need special permits and escort services for transportation, which can increase the overall cost due to additional accessorial fees.

There are occasions when not all services or resources are known before a shipment is dispatched. In such cases, any applicable accessorial charges are added to the invoice after the shipment has been delivered and audited. By meticulously planning shipments and paying close attention to detail, shippers and receivers can reduce the incidence of unexpected accessorial charges. This proactive approach not only helps in managing costs but also contributes to the long-term profitability and efficiency of the trucking business.

Common Accessorial Charges

Fuel Surcharge

Fuel surcharges adjust the freight cost based on fluctuations in fuel prices. This charge helps carriers manage the constantly changing cost of fuel, ensuring that transportation expenses align with current market rates. Understanding how these fuel surcharges are calculated and applied can help businesses anticipate changes in shipping costs and budget more effectively.

Liftgate Service

When delivery sites lack a loading dock, liftgate services are essential. This service involves using a mechanical platform on the delivery truck to lower goods to street level, facilitating the handling of heavy or bulky items. Liftgate services ensure that all items are handled safely and efficiently, preventing damage and expediting the delivery process.

Inside Delivery

Inside delivery charges apply when items need to be transported beyond the main entryway of a building. This service can include deliveries to specific floors or rooms, requiring additional manpower and time. Businesses requiring frequent inside deliveries should account for these costs in their logistics planning, ensuring that shipments reach their exact required destinations within larger buildings or complexes.

Residential Pickup and Delivery

Delivering to residential areas involves navigating smaller roads and managing specific handling requirements, leading to residential delivery fees. These services are tailored to overcome the logistical challenges of non-commercial delivery sites, where standard large freight trucks are impractical. Businesses should consider these potential costs when shipping directly to consumers’ homes.

Storage

Storage fees may be incurred if freight needs to be held at the carrier’s facility longer than planned, often due to acceptance delays or scheduling issues. Effective inventory management and accurate scheduling can help minimize these costs, ensuring that goods move smoothly through the supply chain without unnecessary delays.

Detention

Detention fees arise when drivers are required to wait at a pickup or delivery location longer than the scheduled time. This often happens when goods are not ready for shipment or when there is no one available to receive them. Efficient warehouse operations and accurate communication can help mitigate these fees, enhancing overall supply chain efficiency.

Excessive Length Charge

An excessive length charge is levied for items that exceed a predetermined length, presenting unique challenges in handling and transportation. Recent data shows a 4.7% increase in these charges, highlighting the importance of planning for large item transport and understanding the associated costs.

Reconsignment

This fee is charged when the delivery destination changes after the freight has already been picked up. A reconsignment accessorial fee is a charge that a carrier may add to a shipment when the destination is changed after the freight has been picked up. This can happen when a new delivery destination is requested or if the original address was incorrect. Reconsignment can complicate logistics and increase transportation costs.

Redelivery

Redelivery charges occur when the initial delivery attempt fails due to reasons like the absence of a receiver or the lack of necessary equipment at the site. This fee compensates for the additional attempt, impacting the carrier’s schedule and income.

Layover

If a truck cannot be loaded or unloaded as scheduled during the scheduled appointment, a layover fee is assessed, representing lost productivity and affecting subsequent deliveries. Planning your loading/unloading schedules and staging the shipments near the dock ahead of time can minimize the chance for a layover fee.

Reclassification and Reweigh

For LTL shipments, accurate details regarding weight, dimensions, and classification are crucial. Incorrect information leads to additional handling and adjustments, resulting in reclassification and reweigh fees. Providing accurate shipment details is the number one way to avoid unplanned fees.

Advance Notification

This fee is charged for the extra coordination required to notify consignees in advance of deliveries, ensuring readiness to receive the shipment.

Limited Access

Deliveries to locations with restricted access, such as government facilities or special care institutions, incur fees due to additional security procedures and the extra effort needed to complete delivery.

Blind Shipments

A blind shipment accessorial fee is an extra charge that a carrier may add to a shipment when the shipper and receiver don’t want the other party to know who they are. The fee covers the extra time, care, and attention that blind shipments require. It often involves a third party to maintain confidentiality for this type of discreet shipping.

Lumper or Driver Load/Unload

This charge is applied when drivers are required to load or unload cargo, which is not typically within their job scope. At large distribution centers, this task is often handled by third-party laborers, with the costs passed on as a lumper fee.

Metro Pickup/Delivery

Urban deliveries face obstacles like traffic congestion and parking restrictions, reducing driver productivity and leading to accessorial charges to offset the time lost.

Oversized/Overlength

Cargo that exceeds standard dimensions requires special handling and adjustments in load configuration, leading to additional fees.

Sort/Seg

When shipments need to be sorted or segregated on the truck, this labor-intensive process triggers a fee, often variable based on the shipment’s characteristics.

Hazardous Materials

Shipping hazardous materials demands extra precautions, documentation, and risk management, all of which come at a cost.

After-hour Deliveries

Deliveries made outside of normal business hours require adjustments in scheduling and coordination, resulting in additional fees.

Truck Ordered Not Used (TONU)

If a truck was ordered but canceled after the carrier has allocated resources for it, a TONU fee compensates for the potential loss of other business.

Diversion Miles

Should a shipment need rerouting to a different location than originally planned, charges for the additional mileage and associated costs are applied.

Additional Stops

Carriers charge stop fees for making multiple stops along a route to pick up or deliver goods, as each stop requires additional time and logistics management. Multi-stop shipments require more time and coordination, potentially delaying other deliveries. Charges for additional stops compensate for this issue.

Temperature Control

For freight that needs to be kept at specific temperatures, carriers may charge extra for the use of refrigerated trucks or other temperature control equipment to ensure the integrity of the goods during transit.

Planning for Accessorial Charges

For businesses, especially those new to shipping large volumes, understanding and anticipating these charges is critical. Without proper planning, accessorial charges can significantly inflate the overall cost of shipping. Effective planning for accessorial charges requires a deep understanding of your shipping operations, the nature of the products being shipped, and the logistical practices at the receiver’s facilities. Here’s how you can better anticipate these fees and manage them effectively: Detailed Bill of Lading (BOL): Ensure your BOL contains comprehensive information, including any special handling instructions or legal requirements that are pertinent to the shipment, such as the need for a tanker endorsement for bulk liquid containers. Accurate Weights and Measurements: It’s crucial to confirm that all shipments are within legal weight limits and properly balanced within the trailer. This helps avoid the need for costly adjustments and reworks later. Communicate Equipment Needs: Proactively inform the carrier about any special equipment needs such as liftgates, pallet jacks, or forklifts. This foresight can prevent unexpected charges. Understand Your Freight Classification: Familiarize yourself with your National Motor Freight Classification (NMFC) number for LTL shipments, which helps in accurately classifying your cargo and estimating costs. Audit Your BOL: Meticulously review all line items on the BOL to ensure all details are accurately captured and communicated, reducing the likelihood of errors that could lead to additional fees. Clear Communication: Maintain open lines of communication with carriers and consignees to manage expectations and requirements for each shipment. Prepare for Flexibility: Even with the best planning, unexpected issues can arise. Maintain flexibility across your logistics chain, from brokers to carriers, and from shippers to receivers, to adapt to unforeseen circumstances smoothly. Negotiate Accessorial Charges: Understanding the terms and conditions of your shipping contracts is key to negotiating accessorial fees effectively. Consider negotiating for a higher base rate in exchange for waived or reduced specific fees. Demonstrating the costs and time impacts of accessorials can strengthen your negotiating position. Furthermore, building strong relationships and maintaining open communication with your logistics partners can facilitate fairer terms and contribute to a more successful business operation. By integrating these strategies, you can better manage the additional costs associated with shipping and ensure a more predictable and effective logistics operation.

3PL Center Spotlight

At 3PL Center, we understand the complexities and potential unforeseen costs associated with logistics services, especially during peak season when surcharges and delays are more prevalent. Our approach to managing accessorial charges is proactive and client-focused:

Transparent Pricing: Before you commit to using our services, we provide a detailed breakdown of potential accessorial charges. This helps you understand exactly what services you are paying for and why.

Customized Solutions: We tailor logistics solutions to match your specific needs, reducing the likelihood of unexpected costs. For instance, we assess the need for services like liftgate or inside delivery during the initial planning phase and integrate them into the logistics plan if required.

Advanced Scheduling with Appointment System: To avoid detention fees, our logistics team utilizes an advanced appointment scheduling system, working closely with clients to ensure all shipments are accurately scheduled. This system aligns pickup and delivery times with your operations, minimizing waiting periods and streamlining the entire shipping process for ecommerce fulfillment.

Efficient Use of Technology: Our state-of-the-art WMS platform provides real-time tracking and updates, allowing both 3PL Center and our clients to manage shipments actively and adjust operations as needed to avoid additional charges.

Steering Clear of Surprises: Mastering Accessorial Charges with 3PL Center

Accessorial charges don’t have to be a surprise. With proper planning and a knowledgeable logistics partner like 3PL Center, businesses can anticipate these fees and incorporate them into their shipping budget efficiently. Understanding and managing these additional costs effectively ensures that businesses can maintain control over their logistics expenses, leading to smoother operations and improved bottom-line results.