Booking your cargo on a door to door or CY to Door service can seem like a money saver or appear to offer you the convenience of one-stop shopping for your shipping needs. However, Flegenheimer’s perspective as your broker provides us with a very different view of the “door move experience.” We feel it is our obligation to share the following information with you so you can make informed decisions when booking your door deliveries with the steamship lines.
Did you know there has been a fourth quarter surge of US inbound shipments and that it has caused the following issues?
– Shortage of labor at the port: demand exceeds supply in the combined ports of LA/LB
– Warehouse labor / space: Due to ongoing COVID mitigation issues, receiving warehouses are storing goods for much longer periods of time. They don’t have available space to accept new shipments when the current shipments are not moving out their warehouses. Warehouses are also struggling to find available workers which has resulted in higher labor costs.
– Chassis availability: as shipments are sitting in containers longer, the empty containers are not being returned and the chassis are not being put back into the pool to be available for the next container. This has resulted in a chassis shortage.
– Genset availability: Shipments sitting at warehouses and on chassis for longer periods of time means that for the refrigerated cargo, the gensets are also being held longer to maintain the required temperatures while awaiting delivery. Genset availability has been tight at the ports and the steamship lines are sending drivers to other locations to collect a genset after waiting in line for hours only to be told there are no gensets at that terminal and they must go pick up one at another location and return to wait in line again.
– Truck capacity: Turn times are longer, truckers can’t get chassis, warehouses are impacted by the lack of available space and cannot accept new shipments. Truckers are experiencing more dry runs and longer wait times resulting in increased costs for the client
– Container equipment availability: The cycle of empty containers being returned to Asia to be filled with new shipments is not functioning properly. The issues on the US side are causing backlogs on the return of the empties due to the issues listed above. Steamship lines are predicting tight equipment levels through November resulting in tighter capacity and increased costs.
How does this affect your door move shipment?
• Lack of available appointments at the receiving warehouse which results in shipments remaining at the terminal beyond the last free day incurring hundreds or thousands of dollars in demurrage for which the steamship line takes no responsibility
• When the trucker is finally able to make an appointment at the warehouse, they find there is a lack of available appointments at the terminal to collect the shipment
• Late deliveries of your shipment to your contracted warehouse
• Per-diem fees due to late return of empty containers beyond the last free day
These are only a few of the potential negative outcomes when booking your cargo as a Door Move. Why? The steamship lines are generally not equipped to coordinate and monitor all door moves. They also use truckers that offer the lowest rates in order to get the business from the steamship lines and increase their volumes. Many times, these contracted truckers don’t have enough drivers or equipment to sufficiently handle the deliveries. One of the most common problems we see is that steamship lines do not work close enough with their contracted trucking companies who are responsible for coordinating the delivery to your warehouse. By the time the trucker contacts the warehouse, the warehouse does not have an appointment early enough to avoid demurrage and the steamship line will not take any responsibility for the charges. Demurrage must be paid prior to the release of the cargo to avoid more demurrage. Your cargo is held hostage to ensure payment of fees that are very costly and unexpected. The per diem charges are usually billed weeks later resulting in more unexpected fees.
In addition, original bills of lading should be surrendered as early as possible. Steamship lines generally take 48 business hours minimum to process and apply fees and OBLs. Providing them with as much time as possible to process and apply releases to your account ensures the best chance of success to avoid demurrage and per diem resulting from late payments or last minute surrender of OBLs.
We understand that the lack of control over the delivery of your shipment can be frustrating and expensive. There is usually nothing or very little that we, as your broker, can do to help resolve these situations. Door moves are sold by the origin agents as the easy, convenient booking solution. They sell you the ease of delivering your shipment to your customer’s door. Unfortunately, they usually leave out the details listed above that can add hundreds and thousands of dollars to your shipping costs. Coordinating the delivery of your shipment directly with your trucker on the U.S. end puts the control back into your hands. It allows you to avoid unnecessary surprises like demurrage and per diem charges. Working closely with your own trucker in addition to your receiving warehouse or your customer’s receiving warehouse to ensure timely delivery of your shipment can save you thousands of dollars in unanticipated costs. We recommend having a conversation with your supplier about the current supply chain issues in the US before booking door moves for your upcoming shipments.
If you would like some options on reliable truckers, please feel free to get in touch with your client rep here at FII.