Study identifies trends in shipper freight charges

Study identifies trends in shipper freight charges

Transplace, a provider of transportation management services and logistics technology, has announced the results of its annual benchmarking study conducted to gain insight into changes and trends in transportation accessorial charges.
The study, which included data from more than 150 shippers and more than $12 billion in annual freight expenditure, identified customary types of charges and rates implemented by shippers beyond the basic linehaul fees to help organizations better understand how their accessorials compare with market competitive standards.
Observations from the benchmark study include:
Fuel surcharge schedules—The study revealed that fuel surcharge (FSC) is the most common accessorial published by shippers (93% of companies in the study), with most using a cents-per-mile-based schedule versus a percentage-based fuel method. For companies using the cents-per-mile schedule, most still peg their FSC starting point around the traditional $1.17 to $1.24 range. The majority (73%) were almost evenly split between $.05 and $.06 increments beyond the starting peg. The trend is toward $.06 brackets, a recognition of both the increasing burden of fuel in overall transportation costs and the significant increase in average miles per gallon for truckload carrier’s fleets over the past few years.
Intermodal fuel surcharges were also included in the study, identifying that the surcharges between the truckload and intermodal can vary as much as $0.33 and as little as $0.12.
Detention with power—Under the current hours-of-service environment, time equals money for carriers. Consequently, detention is an important accessorial to manage. Shippers also need to examine their detention policies to ensure they are not requiring non-standard load/unload times for carriers, which could result in penalties and overall access to carrier capacity. The study revealed:
—81% of companies are keeping to the accepted industry standard by allowing two hours free detention, with only 5% of companies allowing less than two hours.
—Most companies (66%) pay in increments of 15 minutes, with an additional 26% of companies paying by the hour. This is up slightly from the 2011 study, which reported 60% of companies paying in 15-minute increments and 30% paying by the hour.
—Detention charges have remained stagnant over the past two years, ranging from $25 to $90 per hour, with most shippers allowing $60 per hour.
Stop-off charges—For truckload service, stop-off charges were compared for stops one to four on a given load. Fifty-six percent of shippers claimed an increasing charge per stop scale, while the 43% balance held a flat charge per stop, charging various levels between $50 and $100. The most common stop-off charge is $100 for the first stop, $150 for the second stop, and $250 for every stop thereafter. This reveals shippers are migrating away from low, flat stop-off charges that do not accurately reflect the carrier’s cost per stop.
Truck order not used—For shippers that do not use a truck to which they tendered a load, “truck order not used” charges typically apply. The study showed that of the 64% of shippers that apply these charges, 43% use a $250 charge, with $150 being the second most common level at 39%.
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