Every month we ship thousands of shipments with our rail partners across Canada with all types of goods – from food to clothing, electronics to machinery.
That means we know the details of intermodal rail transportation and how important it is for you to understand Intermodal Accessorial Charges before booking your shipment!
Now, if you haven’t heard of them before, then we advise you to keep on reading this post to fully be aware of what they are, what their role is in the intermodal transportation industry, and how it affects you as a business.
The Basics of Intermodal Accessorial Charges
What are accessorial charges?
Intermodal Accessorial Charges are an additional type of fee that intermodal carriers charge for each extra service they provide beyond pick up, transport, and delivery. They are also known as intermodal surcharges.
How do intermodal accessorial charges work?
Those fees can be diverse and depend on the type of transportation vehicles involved, equipment and services required, the workforce needed, or even external events affecting the shipment.
Accessorial charges can for instance include demurrage, scale service, inside delivery, fuel surcharges, etc.
Why do carriers apply additional fees?
They are helping carriers to cover for any risks, lost business, or time but also allow them to bring operational efficiencies by making sure the transportation selection and equipment requirements for freight pick up or delivery is right.
What Are the Accessorial Charges Specific to Intermodal Transportation?
There are many different accessorial charges, and each case is specific. We have listed for you the most common ones for intermodal transportation:
Demurrage charges are fees that the shipping company charges you for not picking up your merchandise container from the terminal’s warehouses within the allotted free time.
Per diem charges
This is the first type of detention charge. This accessorial charge is billed to cover the daily cost of using equipment, containers, chassis, or trailers from another carrier, longer than the free time allowed.
This fee keeps on growing until the equipment goes back to the original carrier owner. It allows them to cover the unexpected cost of having their equipment on the road one or several days extra, whereas they could be rented to another client.
Driver detention charges
The second type of detention charge corresponds to the driver detention time fee.
This fee is when intermodal carriers are required to pay an extra hourly charge for the driver when he/she needs to wait for more than the free time planned for loading or unloading the cargo.
You can choose this additional service to scale your cargo on each load. This can help you avoid incorrect weight issues.
Other Types of Accessorial Charges
Below you will find common charges you might have to pay or be billed. This list is not exhaustive, so if you have any doubts or specific requests, don’t hesitate to contact us!
Entrance fees or inside delivery
Fees are assessed by the carrier when the merchandise has to be picked up or delivered to an inside customer location.
This could mean the driver has to enter a building and use some special handling such as a pallet jack to be able to either load or unload the shipment.
Limited access pickup
This additional charge is set for entering into a facility that requires special shipment requirements or extra effort because of inspection of the merchandise, or security reasons.
The limited access pickup or delivery fee is usually applied to specific destinations such as military bases, schools, or even diplomatic buildings.
Lumper service (load-unload)
Similar to the driver-assist, the lumper service is charged if the carrier needs to add labor costs to the final bill to hire an extra workforce to handle the loading or unloading of the shipment between different modes of transportation or at the loading dock.
Extra fee that Carriers typically list to cover increased fuel costs.
Carriers are allowed to apply an extra charge if it is required for the driver to clean his truck before transporting the merchandise.
This additional fee is billed when the carrier requires the driver to load or unload part of the truck’s cargo at a dock.
If the consignee location is not equipped with loading docks, the Intermodal carrier can provide the liftgate service to assist you in loading or unloading with liftgate equipment.
This consists in moving your cargo up and down thanks to a hydraulic platform at the back of a particular truck.
It is important to note that not all trucks come with a lift gate and it is not the shipper’s responsibility to check the delivery destination and add this service. If you consider needing this service, talk to your intermodal carrier in advance.
The additional fee that shipping companies apply in order to transport hazardous materials is due to the added risks they represent for the workforce.
It also covers all the needed paperwork and time spent by the carrier’s team to declare this specific shipment to the Department of Transportation.
This charge is applied when the intermodal carrier has to return back and re-deliver your cargo another day.
Reasons can be diverse: because of a customer’s request, because no one is available to receive the shipment, because there isn’t the necessary equipment on-site to load/unload the goods, etc.
This comes as a pricy expense as, basically, it involves the carrier to redo the whole job.
Extra fee that is based upon the consignee requirements to make the driver send an advance notice to the receiver before its arrival to announce the delivery of the shipment.
This fee is billed if the carrier has to store the merchandise of the customer in its own facilities for whatever reason.
The Cost of Accessorial Charges
How much more will you be charged on your freight bill for those fees?
Really, every case is different.
Considering the right additional services for your shipping plan might be a complex thing to do by yourself. If you get mistaken, it can consequently affect the carrier’s rates and your shipping budget.
We know it can be tricky, but we are here to help you with the process.
First of all, we recommend you get an initial quote on our website. Following this, you’ll be in touch with our trained shipping experts. They will be able to help you define the correct additional solutions you will need depending on your cargo and shipment specificities, as well as help you reduce accessorial fees.
Unexpected accessorial fees
Some accessorial fees, such as demurrage or per diem fees are unexpected and triggered by external reasons or unplanned situations.
Yet, they are legitimate as they affect all parts of the supply chain and shipping process.
Unfortunately, you sometimes cannot plan for those additional costs, so they might have to be added to the freight bill during or after shipping depending on the event.
Reduced accessorial charges
If you can give us more details on your cargo and its specifications, we’ll be able to estimate all the potential accessorial charges that might come up.
This way we can help you identify ways in which these extra costs could be reduced or even eliminated. We always do our best and work hand to hand with our customers.
However, a few things that can help reduce these additional charges are:
- Understanding the shipper and consignee requirements
- Checking correctly weight and size of the containers and of the load
- Making sure you know the carrier rules tariffs and rates
- Choosing the correct transportation vehicles and routes
- Having set up the sufficient teams or equipment to allow a fast and efficient delivery
- Plan the delivery ahead of time
As you can see, intermodal accessorial charges are quite specific, costly, and can add up quite quickly.
It’s then very important to understand their impact on the overall shipment cost and to require the correct services you need for your intermodal transport shipment.
We hope you enjoyed this blog post and if you need any further assistance or advice in order to plan your Intermodal shipping strategy correctly, do not hesitate to get a quote or to contact us directly! We’ll be happy to help!