Freight 360

Common Accessorial Charges | Episode 288

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🚚 In this episode, we cover:

  • ⏱ What accessorial charges are (detention, layovers, TONU, lumpers & more)
  • 📄 How to document charges and avoid disputes
  • 📉 Real-world examples of how mishandling accessorials hurts profits and relationships

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Speaker 1:

Welcome back to another episode of the Freight 360 podcast. We're up to 288 and today we're going to be given a brief rundown on some common and maybe some not so common accessorial charges that you'll probably encounter, depending on the line of work or industry that you're targeting or prospecting in your career as a freight broker. But first, make sure to continue to share us with your friends. Leave us that five-star review, leave your comments or questions on the YouTube page If you're watching us. That way you can submit any kind of question or comment through our website, freight360.net. You'll also find our full library of all of our content from blogs, full-length podcasts, shorter educational videos, et cetera.

Speaker 1:

And there's the Freight Broker Basics course. If you're looking for an educational option, which we've had an uptick in people consuming the course this year, now that it tends to be a bit more of confidence. You know we tend to see it's interesting like we have the analytics and metrics on when people are like searching and consuming our content. Naturally there's a correlation with the market, but we tend to see before the market gets into a really bullish type of environment. We see people their interest peaks because there's discussion about it environment. We see people their interest peaks because there's there's discussion about it. So we we've got a lot of folks that have been using our, uh, using our course and our content for, you know, to train and educate themselves, as well as, um, to train their team, and so it's a really good um, really good, you know ancillary option there if you're growing your brokerage. So, ben, what's what's new with you, man? We're both hanging out in the sunshine, is it the sunshine state? Am I calling Florida the right time.

Speaker 2:

It is the sunshine state, all right. Good, that is correct. Yeah, dude, weather's pretty, it's super hot Actually in the past couple of days. I had tennis last night and I'm like soaking wet, I mean like noticeably hotter. It was like one days where humidity kind of crept in, since, oh, probably last summer, whatever you know spring or whatever yeah, it kind of dies off, but it's nice. Man got a worked up good sweat. Weather's still like not rainy yet I mean beautiful. You guys were out on the boat too, how's that?

Speaker 1:

it's good man. So here's the interesting, and I had no idea about this. So my parents live in fort pierce, so we do. We usually do like a pontoon boat day whenever we're down here and just kind of cruise the intercoastal, which is like the water between the mainland and the hutchinson island. It's so cool because you don't get like choppy, wild uh water um, but uh, there's these like little islands and I had no idea they're man-made. So they were, they were, they were made way back whenever that technology I assume I would imagine probably 70 years ago, right, they just dredged certain areas and they threw in like they made these islands and the reason was actually for hurricane protection.

Speaker 1:

So it would stop the surge and I had. I had no idea and you know, someone was telling me already and I was like that makes sense.

Speaker 2:

Pup, interesting things about that, about that, um, one of my wife's friends, um older woman, she volunteers and works at the boca museum. You know it's like kind of a historical building, small one, but we go there like once a month. They have a kid's day and like talk to them and they have all kinds of cool stuff for the history of boca and some of palm beach and one that I found very interesting. The other thing I learned too is like the vegetation that they planted there is like integral into those functioning like mangrove trees that you see growing up around them, which were really important for like um sheephead and, I think, snappers, what we used to catch, because on the west coast it's the same that holds the beach there right.

Speaker 2:

So as they got rid of that, you know, probably like 100 years ago, maybe 120, because it was all like where I live and most like it was swamp land and like jungle, basically right. So when they drained the water and created kind of the canals that go up through here, like there's one right behind my house I think there's small locks that manage, obviously, the different heights of the water, but they had to replant those all along the area to keep all the beaches and things from like eroding, because down South and Fort Lauderdale this was like last year, but like the beach had eroded like all the way up to like some of the condo buildings, and they'll do this Like it's pretty cool, like I've seen them do this out on our beach. They'll bring like it looks like a giant barge Right and it basically shoots sand.

Speaker 2:

Yeah, they shoot sand back to refill and backfill the beaches. And then one last kind of random but cool piece of history was, like there were like a few architects and like, I guess, wealthy businessmen you would categorize them that are integral into why this stuff looks like Flagler right, like there's Flagler College, there's all these streets. He's the guy that built a railroad that all the way went down to Key West and that was a super interesting story if you ever want to dig into it. But the other guy, addison Mener, who my daughter's school's named after he built Boca and the plan was to make it look very similar to like Venice, with like the canals where you would walk and have those little boats. But the real, the real estate crash happened and they lost their funding, like in kind of the middle of it.

Speaker 2:

But the one thing they did do and I'll show you this next time you're here is boca lake, which is a pretty big lake. He built a resort next to it which was like the crown jewel resort, like in the world at the time. But they dredged the thought the bottom of that lake completely flat because they wanted the water to your point to be like glass, so like in 1915, right, imagine the technology. They dredged this really pretty big lake right, completely flat on the bottom so that, like the water on the top was supposed to be like glass back then and I always find like that's super interesting. I just can't imagine what that looked like doing that, moving that much dirt a hundred and some years ago with basically like the technology they had then.

Speaker 1:

Crazy. Well, learn something new every day. Before we get into sports and our content, I want to bring in producer Steven and if you guys haven't seen this new it's, I'm trying to. I'm trying to like figure out where the graphics fall. Like it's better than nes, but it's, maybe, you know, sub part of like super nintendo, it's somewhere in that range. But, steven, tell us about your game that's been going viral on uh, twitter and other social platforms.

Speaker 3:

Give us some stats and all that stuff yeah, so, uh, it was about a month ago. Uh, someone on x uh peter levels, I think is his name did this whole like vibe code thing. He made a, an airplane simulator, which is actually really cool. Um, it's at flypetercom, I believe, but anyways, um, so I decided I was like, all right, well, I mean, if I can make that, I'm sure I can make something. So I decided to model like a subway surfer style trucking game and basically that's what it is. I mean, the graphics are, eh, but it's addicting, like subway surfer, yeah, and it's got all like the freight related humor in it. There's lot lizards and DOT officers and low bridges and truck stops, you have to get fuel, yep, all that stuff.

Speaker 3:

Yeah, if you wait too long at the truck stop, a lot lizard comes out and steals your stuff. So you know it's fun, but the craziest thing is, like I mean I did not anticipate.

Speaker 3:

It's called Freight Frenzy. Freight Frenzy, that's right, yeah. And so the other thing we did is we made a website, freightgamesio that eventually, once this competition's over and time is, we'll have a little more time, we'll start putting more games on there and if people are making games and don't know how to host it, we'll host their games for them. But yeah, in the first 27 days we've had over 13,000 people playing it. It's averages to about 500 a day. We've got I think we're up to five, maybe six, sponsors. We've got a couple of people talking to us about billboards or putting other like creative things in it. So you know, it's fun, there's a lot of flexibility to it and it's just, I mean, for the little amount of time that I've had to put into it.

Speaker 3:

It's been fantastic. I love it, man.

Speaker 1:

All the fun little extra stuff that goes into our industry, from like memes to the gone. Now we've got Freight Frenzy, so check it out, you'll see it on. So what's the? Is it Freight Frenzy? What's the?

Speaker 3:

how do they?

Speaker 1:

get to it.

Speaker 3:

So FreightGamesio.

Speaker 1:

OK, FreightGamesio, Okay, freightgamesio, and it's on there, or just you know, follow us on X you know formerly known as Twitter, and you'll see plenty of posts or shared posts about it. So you can find it. There's a leaderboard. You'll see, like, what your rate per mile is at the end of all of it and you know total miles and all that stuff.

Speaker 3:

Yeah, someone did 120,000 miles. How long would that take? Like how long was this person playing? My guess is it had to be at least two hours at least, I mean, unless they faked it somehow driver called then hold please right two hours later right, yeah, that's nuts well, cool, appreciate you, uh, adding some some fun and humor and everything.

Speaker 1:

All right, let's. Let's talk sports. Ben, you've been watching any March Madness? Have you caught any of it?

Speaker 2:

I caught some of it, but not a ton.

Speaker 1:

So Duke I'm talking men specifically right now Duke is the clear frontrunner and pretty dominant Going into the Final Four this weekend the top four teams from each of those of the one seeds right. Yeah, that's what I mean. Yeah, all the one seeds are have made it. So I don't know, have you? Have you ever heard of the show the White Lotus?

Speaker 2:

I was just going to reference it. I saw it characters who is seemingly and constantly thinking about suicide is always wearing a duke shirt in every scene where he actually like goes to. You would call it like foreshadowing, I guess, because it's not hindsight, it's what he thinks might happen and he's wearing a duke shirt every time he's contemplating. And then I heard they filed not an injunction, but he's contemplating.

Speaker 1:

And then I heard they filed not an injunction, but you stepped away from the mic. We can't hear you, but basically, Dogs are bark. Oh gotcha, I don't have that problem here. My dog's at home, but wait. So who filed?

Speaker 2:

an injunction I don't know if it was necessarily an injunction, but on the radio they were talking about it that apparently Duke put out a, a statement that you know. The show is in no way affiliated with duke university. They don't appreciate the association of I.

Speaker 1:

I just think it's funny because, like I, I watch the show, I think it's, it's good. And um, when they like literally the episode comes out where, like they show him holding a gun to his head, and literally I'm like that's gonna be a meme. That's going to be a meme. That's going to be a meme if Duke loses, like if they don't go the whole way, like literally that's going to be plastered all over social media. So, but yeah, it should be. It should be a good, you know, wrap up. This weekend You're going to have the final four and then I think the championship game is Monday. Either way, it's all this weekend, the final four in the championship.

Speaker 1:

So I didn't do a bracket. I like I did a bracket on my computer but I never actually like wrote it out and like my, my wife and my kids love doing it. But I had Duke to go the whole way. So my son's got Florida. I think Duke's going to play Florida in the championship. We'll see how it pans out. I've been known to have incorrect picks in sports, so don't, don't take that one to the bank, anything else in sports.

Speaker 2:

Not sports, but today's Liberation Day, where at four o'clock today, apparently, the administration is finally going to announce the specifics of the tariff policy and they will be effective immediately. Um, it's gonna be interesting. I mean what and how these are.

Speaker 1:

Yeah, we've been talking like there's been tariff talks like every news outlet, right, whether it's freight related with all the newsletters in our industry, or just like national news. It's like you can't go a single hour of consuming news without hearing the word tariff, like it's all, it's everywhere, so yeah.

Speaker 2:

And there here was some of the things from um free caviar. I don't know who this guy is, but one of the ugliest, most stagflationary ISM manufacturing reports. We've seen it a long time. Virtually all the comments are complaining about tariffs, and the only categories that are going up are prices and inventories. Jason Miller put out something really good on LinkedIn yesterday, where he basically proposed specific tariffs that would have a less inflationary impact but still have the strategic impact to incentivize more US-based jobs. It was a really good piece and his quote is you know, assuming very large tariffs get announced this week, I fear manufacturing sector will see weakening output as we move through 2025. We've seen multiple companies like Johnson Johnson, tsmc and Foxconn have announced billions of dollars in US manufacturing investments, and NVIDIA has also joined that list, pledging hundreds of billions in US electronics. However, that takes time. Walmart turns up the heat on suppliers. While Walmart is already adjusting to the new landscape, per Reuters, the company is pressuring Chinese suppliers to cut prices by up to 10% to cushion their impact of tariffs on consumers, but manufacturers are pushing back citing they're already on slim margins and raw material prices are going up for them as well. Bloomberg reports that Walmart still depends on China for a huge share of items like their TVs, toys, apparel and appliances.

Speaker 2:

Here's some global reactions. Japan will fly to Washington if we must. Japan is stepping up its lobbying efforts as 25% auto tariffs are set to hit Japanese carmakers starting today. Their prime minister told reporters he's prepared to fly to DC personally to seek an exemption. Minister told reporters he's prepared to fly to DC personally to seek an exemption. Japan remains off of the exemption list, despite being one of America's closest allies in Asia. Israel, meanwhile, has gone the opposite route. On April 1st, they announced they would eliminate all remaining tariffs on US imports, calling it a move to strengthen ties and lower domestic costs and lower domestic costs. And still Trump's scope is vague. Aside from the confirmed 25% duty on car and car imports, other goods from Europe, south Korea, brazil and India are rumored to be on the chopping block. Nobody really knows, but apparently sometime later today we will get more details.

Speaker 1:

Yeah, well, I mean, by the time this drops on Friday, we'll know Other stuff in the news too. And if you don't subscribe to the newsletter, please sign up at our website. It goes out every Tuesday and Thursday, so when I was putting this one together on Tuesday, did you see that? Like, apparently, the egg shortage is just they declared it over. It's done, we're back to over.

Speaker 1:

Yeah, like literally, if you look at a month ago versus now, like the price of eggs has has gone drastically down. So whether you're a local grocery store has followed suit and or if they're just getting some extra profits is a different story, but that's a big thing. We've seen some record port activity. I think that's natural, ahead of any tariffs, right? You assume people are going to try and push everything they can in. And what else did we see here? Well, more tariff stuff. Just check it out Freight360.net. Hit the subscribe or the newsletter sign-up one. So cool man, let's talk some tariffs.

Speaker 1:

So the idea for this episode, because we kind of bounce around with our topics, but I think it's good for us to sprinkle in a lot of one-on-one level educational stuff, because people will go to our website and as a listener, I encourage you to do this. There's a search bar at the top and if you're just curious about prospecting or sales, you could type in sales or prospect. If you're curious about LTL, you could type in LTL. If you're curious about detention or layovers or accessorials, this episode will live there forever. So this is good stuff and it came up today because someone had asked me. Oh, stephen said there's a chat in the. Oh yeah, we have an AI chat and a website now too, so play around.

Speaker 1:

That came up this morning and one of the guys in our company was like he's like, is it me or am I crazy? Or like shouldn't the shipper be responsible for, you know, loading and strapping stuff down at the at the shipper, and he sends like a picture of like poorly, like bad strap work, whatever, and they're trying to blame it on the driver. And I was like well, it depends typically if there's a driver assist involved, which is, I was like um assessorial right there. Right, it all depends on the situation. Like who's responsible for what um ultimately like? And we won't, this is a different conversation. But like when you sign, you know, when the BOL is signed by the shipper, the carrier and then the receiver, everyone's acknowledging receipt and condition of those goods.

Speaker 1:

But I thought about there's a lot of different accessorials out there and I've honestly dealt with a lot of questions on it in the last week. So I was like let's kind of break a lot of these down in no particular order either. Let's kind of break a lot of these down in no particular order either. You know we've talked about different ones in the past, but I think it's good for us to give a refresh on what are some of the going rates on these right now. How do you know what impacts the rate? Who's ultimately responsible for them? Should you, you know, should you, make any margin on these? So there's a lot of a lot to unpack here. What would you say if you had a guess? And I'm putting you on the spot here what's the most common accessorial? You think you've run into the most common and while you're thinking about that.

Speaker 2:

Yeah, I was going to say Detention.

Speaker 1:

Yep, detention, right. So when we talk about what is an accessorial, these are extra charges. So typically if you look at what you're charging your customer and what you're paying a carrier, it's either just an all in flat rate let's say hey thousand dollars from A to B, right? Or sometimes it's broken down line haul and fuel and we're going to answer a question about fuel surcharge on our Q&A session, so tune in Tuesday for that episode. But yeah, I would agree Detention. So we'll start at detention. What is it? What is it charged, et cetera? Who pays for it?

Speaker 1:

So detention, this is not you're in trouble at school and you got to stay after, but the word kind of correlates a little bit. So think about if you have a scheduled pickup at, let's say, you know, eight o'clock, all right, driver shows up at eight o'clock and they end up not, they're not ready to load that truck yet. So the driver has to sit there until there's an available door, or it could be an available crew on the dock to load their stuff. Whatever the case might be, they're waiting and there's typically a policy that your shipper will have that will determine when detention kicks in and how much they will pay for the duration of that time for detention. So I'll give you a common example Two hours of free time, right?

Speaker 1:

Two hours of free time, that means the driver is expected to wait up to two hours to be loaded and rolling, right. If they go beyond that two hours, then they will be compensated an additional amount, usually per hour, maybe 50 bucks the shipper um, and you know that's why it's important to have in and out times, maybe at the gate, or it could be a uh, you know they, it's like a clock that gets stamped. Whatever the case might be, um, but I've typically, you know, 50. I've seen even upwards of a hundred dollars an hour. It just depends on what it is. But your customer um will usually have a set rate, or I have, I've even seen with some smaller ones they handle like on a case by case basis, but it's typically a published schedule of when it kicks in and what they'll pay, etc. What's your, what's your take on that?

Speaker 2:

So here's some things to consider. One you need to ask this from your customer at the time of onboarding. You need to know what their parameters are. So ask it clearly, get it in writing. That's one of the biggest problems I've run into is that nobody just asks right, and then the driver expects it and they're like well, I don't know Like you need to ask this as part of your setup with a new customer and even if you've been working with a customer for a while, like you should ask them and have this put in writing. Is the first thing right? The second thing is, like for drivers and carriers out there, before you book a load in the spot market, ask the broker what is the detention policy? Can you put that in writing before you book the load, Because it is so much harder to deal with after the fact than if you get it in writing before. Like, hey, looking at this load, you negotiate the rate. What is the detention policy? How likely is it? What do you need for it? And here's why Most detention requires what you said the driver needs to check in and have that BOL signed and initialed by someone at the facility at the time of check-in and check-out.

Speaker 2:

If it is not signed by someone at the facility at the time of check-in and checkout, If it is not signed by someone at the facility and just the driver, most of those don't get approved, from what I've seen. So you need someone there that says, hey, driver's here at this time, they put a time, they initial it right. The second thing is like this is why it's very important to get the BOL once they deliver, and even just get an image of it so you can verify and request if there is detention. The second big thing is lots of shippers will require to be notified if detention is about to occur. And why does that matter, right? So why it's also important to be talking to drivers, not to just book a load and forget about it is like there are lots of shippers I've seen that's like hey, if the guy's been there an hour and nobody has gotten to his truck yet, please let us know. We'll call the facility, We'll send an email to try to get them to hurry up so that they don't have to pay detention. Sometimes they're busy, Sometimes it's disorganization, whatever, they at least want a heads up so they can try to avoid the detention.

Speaker 2:

Right, and in those scenarios, right, like you literally will have to put it in writing in order to get the detention. They'll be like dude, you didn't tell me this guy's been here four hours. If you'd have told me three hours ago, I would have reached out and got it fixed. And then you don't get it and then the driver's still going to expect it from you, because that's your responsibility as a broker to follow your customer's procedure, not the driver's. And it's also important to tell the driver you need to be notified if that's the case. Hey man, if you're there an hour, you got to tell me because I can't get you detention unless I give them a heads up before the clock starts. Right. Those are like the very common issues that arise that are all preventable just by crossing those T's and dotting those. I's Asking the questions getting those things spelled out 100%.

Speaker 1:

So I'll give you like, what a scenario in which you didn't ask the questions, you didn't do things the right way, and what could result out of it. So let's say, driver, driver ends up waiting four hours and they're like hey, I need two hours of detention and you're like all right, I can. I've seen it so many times Like I'll request it from the customer. Customer says no, like you never told us this driver sat there. Had we known, we would have shuffled things around and got that driver loaded. This is on you. So now you have to make a decision like whose fault, you know? Did the driver not let you know that they were waiting there? And if that's the case, then maybe the driver is responsible for not letting you know because you had no idea.

Speaker 2:

But if you knew and you didn't do anything about it, now you're, in my opinion you should be obligated ethically to pay that driver some additional compensation and you're obligated if he didn't tell the driver. He needed to tell you beforehand, because that's not the case everywhere. It's your responsibility to communicate that clearly to the driver before he gets there. Hey, if you're there an hour no one's gotten to you, you've got to let me know, otherwise you won't qualify for detention.

Speaker 1:

Yep, and Stephen made a good point. He said you know there's differences too, based on appointments, versus first come, first serve. So, yeah, I mean, if there's an appointment and the driver misses it, sorry, like totally different situation. But if it's first come, first serve, that's where you'll tend to see detention, you know, more commonly, and the same thing goes like. So layover is another as a story that's very similarly related. Right, this is instead of just hours of waiting, this is you have to wait overnight. But this could be because of either the driver missed their appointment, in which case sorry, like that's on you, that's not on us or the shipper. But if it's the shipper's fault, the same thing.

Speaker 1:

Right, there's typically a policy for layover on first come, first serve. Were they there within their um the window that they were told to be there? And then is there a amount for it? I've seen drivers ask for for um a thousand dollars for a layover and I'm like, huh, um, it there is. You know, there's definitely. This is noteworthy of a discussion point here because depending on the type of equipment, um, the I guess you call it like the uh, yes, opportunity cost for that trailer is it varies, right? If I'm just a standard 53 foot drive van layover might be 250 bucks. If I'm a um land over dimensional, like specialized uh heavy haul open deck trailer like I might be, I might be saying like my time is worth 750 for a layover right, or higher for some of these really specialized ones that these guys are making a lot of money on, you know, a single load.

Speaker 2:

And here's the thing too that I would point out, like I am far more on the carrier side on this, that I think those are too low. Here's the other thing to consider there's usually a cutoff in time between detention and when it becomes a layover, meaning like if you check in at 2 o'clock, your detention starts at four, that shipper loads till eight. They'll be like we will pay whatever four or six hours of detention, at which point in time then it becomes a layover. Some will pay like eight hours of detention and then it flips to a layover, but again, that shipper will have that spelled out in their access to real policies.

Speaker 2:

Anytime I'm looking at a bid, I'm looking at what those are because they matter and from the driver's point of view, like they're likely trying to make at least twelve hundred bucks a day. So if they got there at ten in the morning and they don't load till tomorrow, that truck absolutely lost a thousand to twelve hundred bucks in opportunity costs and then you're going to try to pay them two fifty, like I'm for sure on the carrier side.

Speaker 1:

that, like I think those are way too low in a lot of these instances. And the other thing I want to point out the reality is nobody wins when this stuff happens. Nobody wins. Driver loses their opportunity to make money, the customers pay more money. It's just. It's bad for everybody.

Speaker 2:

Correct and that's why it's like when you clearly communicate this to the driver, you don't need to do this, as it's like confrontational, like if you're telling the driver like hey, let me know, it's in their best interest to get loaded sooner to roll. They make more money than waiting right For the shipper, it's in their best interest to avoid paying additional costs. They want to get them loaded faster. So a lot of these times to your point, like it's resolvable in the best interest of everybody with clear communication. But then one, the broker doesn't tell the driver, so he doesn't tell them until after it happens. Now the broker's out the money because that's the broker's fault for not telling the driver. If the broker told the driver and the driver didn't communicate to the broker, that's on the driver right Now. If the driver told the broker and the broker didn't tell the shipper, that's on the broker, right. Like the responsibility always falls. I feel like as if everybody is aware that step one. But then where that breakdown of communication, that's where the responsibility lies for who should be responsible for paying it. Because, to your point, like nobody wants these things to occur but they're incredibly common and where I've seen the most common is in produce, like they are super common.

Speaker 2:

We've had customers that are brokers owned by that shipper and they've gone like, oh no, we just don't pay attention. And like I've seen loads like averaging four to six hours to load on everyone. Like, yeah, we just don't pay attention. We're like, but wait a minute. Like we know you're shipping to Target or Kroger, for example. Like we know, their detention policy is 85 bucks an hour. That guy was stuck at Kroger for five hours. We know they're paying you because you requested the bill of lading with a check-in and check-out time. All of a sudden you don't pay it to us. And why do you need to be with the check-in and check-out time? Because you're going to bill them. You're going to turn it into a profit center and then you're going to stick me with a bill and the driver yeah.

Speaker 1:

So I'm actually curious your thoughts on this because I'm of the belief that any type of assessorial or deduction should be a straight pass through right.

Speaker 1:

So we're talking about assessorials here, which is additional pay, but I always think the broker shouldn't be making money on it.

Speaker 1:

But that being said, some brokerages like I've seen it more common in the larger ones that folks that I've talked with they have a company policy for a lot of their accessorials, regardless of what the customer is, and I see pros to that because it's like all right, as a brokerage we're going to pay 50 bucks an hour for detention after two hours on every shipment for every customer and that's our standard policy.

Speaker 1:

So it gives peace of mind to the driver to know ahead of time like hey, you know we can offer this, you know that you'll be taken care of if you're delayed. But then the question comes down to like well, what if the customer does pay more? Is that just kind of like well, this is our policy, you, you knew it ahead of time. I think there's a. I guess my my thought on it would be this Like if I were to start a brokerage tomorrow and create a, an accessorial, like schedule for as a brokerage, I would have like. Here's our guaranteed minimums for everything, so like that covers you in case the it covers the driver, in case the shipper denies it for whatever reason, but if the shipper's paying more.

Speaker 2:

I'm going to give you the full amount. Okay, I've asked that and I worked at a big brokerage and here is the rationale. For the other side of that right Is one when an access order occurs to your point, it's much easier for the company to operate consistently to the carriers Because then it's clear to every carrier, no matter what load they run for what shipper, they're really working with that company TQL or whoever. It is right. So like that driver should be able to know whenever I book a load with this company, this is what my detention procedures are Communicate after an hour of being there, get the BOL check in and check out times. This is what I can expect to earn on that right. It makes it easier, more efficient and more clear for the driver. Now, on the other side, what has happened and what I really got to understand. I got to meet with like the CFO actually at the company and talk through this.

Speaker 2:

One time was like one as a percentage, most of them don't get approved and as another percentage, the ones that do get approved take a very long time and a lot of admin work, lots of people you've got to pay to follow up to keep requesting it.

Speaker 2:

That invoice takes longer to pay, there's larger interest costs on that money not coming back to the company in time. So yeah, there are instances where maybe the broker gets 250 and paid out whatever 150. So it seems like a hundred profit. But what really happens is like that load doesn't get invoiced for like three weeks because the shipper just keeps dragging their feet going hey, resubmit that. Sorry, I didn't get a chance to look at that. That invoice drags out to 45 or 50 days because of the accessorial. And again, like you're paying somebody at this company to basically just constantly follow up and process these plus the cost of money and as a percentage, like they end up losing more than they ever win. I can tell you, at least from their opinion was like it's definitely isn't a profit center. Even though it might seem like a dollar profit on a load instance, when you take all of those all together they end up losing money in both the time the admin costs, the follow-ups and those things.

Speaker 1:

Yeah, I get the rationale behind it. I do Because, you're right, there is so much time that goes into it. The same thing happens if there's a. You kind of just outlined it, but I've seen it too many times where three weeks go by of 200 emails back and forth trying to verify one thing, and the amount of hours and people involved just to get one little thing done, and it's like what.

Speaker 2:

And here's the other thing too right, and I'll give you two other examples. I had two very large accounts at a large brokerage that were incredibly administratively taxing, meaning like lots of admin steps required to invoice any load. One was with the Steamship line and one was with the DOD account. And the DOD account had, like CAS and like all these systems for approvals to go through and processes and if literally one cent is off, that thing gets kicked out. Same thing with, like the SSL systems and we can go through drainage access orials, because they are common on every load and to verify them is more complicated, more difficult and more administrative.

Speaker 2:

And like just my team, on those two accounts for load volume, we had two what you would call they call them essays, I think they were called sales assistants, but basically all they did was this all day. So there were just two people that I had to pay out of my pocket at least a portion of their salary and all they did was sit in CAS and sit in this other system checking the pennies on the invoices, checking the procedures Did the BOL have the right signature? Wait in the right place, was it submitted in the right way to get approved? And then you've got to go in and do something sometimes to make that system know it's an access serial and upload some other document. So like, literally, I'm paying out of my pocket to people just to reconcile things that on other accounts I had like flatbed work with, like steel and things I could run it with half the amount of people Right, and it was just to get them to pay for what they were supposed to Right.

Speaker 2:

So it becomes, honestly, it becomes a giant pain in the ass. Is that true? You make a good point.

Speaker 1:

I think back to another company I worked at. We had, I think at one given time there was like 35 different unique shipper portals, um, that we had to have someone trained on, and obviously they have to. You have to have a backup in case that person's out, right, um, meaning like, for example, one was a mushroom shipper and like every time we had lumpers and we'll get to lumpers in a second but like you had to request it, you had to upload supporting documentation and you had to do within within a certain time period and if you didn't, like, you're not going to get reimbursed for whatever those costs are, but another. So we just talked attention and lay over some close, similar but maybe not as common as your reconsignment redelivery.

Speaker 1:

I've seen this more in the LTL space, but this is like, hey, you know, we've got to reschedule the delivery, we've got to change the location of the delivery to maybe one of our other locations nearby or maybe in a different city. Right, you're going to have what you would consider a redelivery fee or reconsignment fee and your shipper typically pays this to compensate the carrier for their time. These are more common in the LTL world. Compensate the carrier for their time. These are more common in the LTL world. If you think about it, if I'm going to book a shipment to deliver, let's say it's supposed to deliver between you know, we said eight and four and the LTL carrier gets there at three o'clock and the receiver says you know, we don't have time. This has to get you know, redelivered tomorrow, right? Well, clearly the carrier is going to want compensated for that because they they had to pay a driver their window.

Speaker 1:

Yes, yeah, time to go try to deliver that. So they're going to usually tack on a redelivery fee for the next day and an ltl little different world they have like very. Each carrier has their own set schedule of these accessorials, so make sure if you're booking something like, you're aware of what those are and how they get rebuilt and all of that. But those are some close ones. I wanted to at least loop in with the. Basically, you're wasting a driver's time, so redelivery, reconsignment, detention, layover, so I want to hit on. Well, here's another one Driver's wasted time, truck order not used, all right, and this is like. This is such a this whole thing can cause like a lot of one star reviews on Google and negative reviews on dad yes.

Speaker 1:

Like all kinds of stuff. It's always like you guys, you got to pay me a truck order not used. All right. So what is a truck order not used? Well, this is when the truck ends up not being needed or not being used and the driver wants to be compensated for their time. So let's say you book a truck to go pick up a load, customer cancels it or whatever the case might be. Or let's say you know you never actually had the load and you book this truck and somebody else got awarded it.

Speaker 2:

Well, now that driver is wanting, you know, to be compensated for their time. Now, there's right there. There's one thing I want to say before you go past this point is in the instance where a customer says this load yours and then tells you oh, sorry, that load's canceled and what really happened is they gave that load to someone else, right? The one thing I learned early on, especially like we call it, jump off rate, where it's like you know, shipper sends out a load list, everyone sends in their rate, the customer says, hey, this load's yours, and then someone else, probably five minutes later, gives them a cheaper rate and then they cancel on you, right?

Speaker 2:

The thing they taught us really early on and it's not foolproof, but it helps is did you get the tender? Did you get the official load tender for this load, or an email that just says go pick this up, because if you have the tender, that's your load, and then they owe you the broker for a truck order not used, where you know if you just get a verbal, hey, send a truck, which happens commonly, right, it's much harder to get that, because the reality is is there's no way to know if that load actually was canceled or if they gave it to another broker or another carrier. But the only way you've got some verifiable leg to stand on is did you get the load tender? Because then usually, if at least some times passed, you can make the argument back to the shipper like I dispatched this driver that you booked, like I got to pay this guy, and most of the time you will be compensated for your truck or not used.

Speaker 1:

Yes, agreed, I'm glad you pointed that out. Documentation is king in our industry when it comes to requesting this stuff. Draw the line with whether a driver deserves a tone or not is kind of twofold Is number one how far in advance did it occur? And number two was the driver actually on their way yet? Because if I have, let's say, I have a load that's supposed to pick up this afternoon at four o'clock and it's 10 am and it gets canceled, you know, an hour after I booked the truck and that truck is, they're not even done with their first delivery Right there. They might be on their way to deliver at some facility two miles away from where my load picks up. In my opinion, if none of their time was wasted and they had, they had no potential losses.

Speaker 1:

There is an argument that a tone is not a tonu is not appropriate in that environment. And if your customer has a policy and it says, hey, if we cancel it within 12 hours, you get a really tough argument trying to justify paying a ton of there because the driver definitely didn't have any lost time or potential losses there. And your customer will probably have again a schedule of here's what a ton of pays and the range can vary, but you might be 200 bucks or 150 or whatever somewhere in that range. But what's your take on? Like the lead time on it, and if the drive even if the driver let's say it's a 24 hour cancellation policy, but like what? If the driver's not even you know done with their last load yet? How do you handle those?

Speaker 2:

Here's the procedures and the SOP that I learned. And what I honestly still have preference for is I book a truck with a dispatcher. I am going to call that driver, not the dispatcher, to confirm a few things. Hey, just wanted to confirm you are going to be empty at so-and-so location at so-and-so time. What's the MC on the side of your truck? What's the equipment you have? Just want to confirm all the details. Okay, they tell me they're going to be empty wherever that is at 10 am. Right, Until they are empty and rolling to my pickup. Right, they are still on the job and working on another load. They have not become on hire for me until they are empty from their previous work and rolling towards my pickup. As soon as I cross that line, meaning they finished their last delivery and are driving towards mine, I don't care if it's one mile or a hundred miles, I owe them a truck order not used. If they're still at their last stop working on their last load and my load is canceled before then, I'm not going to pay the truck order not used because the dispatcher can book another load before that driver has started driving and working for me.

Speaker 2:

Like, that is the line I was taught of where that happens and that's why we would check call drivers and confirm that, like hey, are you empty and rolling yet? No, I'm still here. Okay, Note that with a check call. When do you think you'll be empty? Call me back in a half an hour, Okay. And it's not to avoid the truck or not use. You also need to know when that guy is done and what the ETA is to your ship up. So you should know this anyway and you should be doing these things.

Speaker 2:

But I think so many brokers are so used to email and text messages and just go oh, the driver. The dispatcher said this. I'm like the dispatcher doesn't even know when the driver's empty and rolling a lot of time. Like know when the driver's empty and rolling a lot of time? Like isn't even paying attention. It's just going to tell you whatever he wants you to hear so he can go back to doing whatever else he needs to do.

Speaker 2:

You got to speak to that driver to confirm that one. That is part of your job as a broker. He works for you, not that shipper, and if you don't know when and where he is working for you, you don't. You're not doing your job properly and I think if you're doing those things, these things don't come up as often, but I think people just are lazy and then they just go ah, whatever, I booked that guy, He'll be there. And then they'll just, hey, sorry, not going to pay this, or we'll pay this, based on some arbitrary feeling on the day. It's usually based on how much money they're making on the load no-transcript side of the truck order not used and I get this one.

Speaker 2:

A lot is like why do I got to pay a truck order not used when I had three trucks book a load with me and cancel a half an hour before pickup and that guy doesn't pay me Right? And, to be honest, like it is just a one way street, like a driver can cancel on you and they don't owe you any money, but if you cancel on them, you do, you're the one hiring them.

Speaker 1:

No, you're absolutely. I mean. The same thing also goes if, like if I, if I accept a load from a shipper and then I bail on them last minute and then they've got to go pay top dollar on a Friday afternoon like they can't come after me but they can stop giving me business which holds a lot more weight than you know a carrier basically saying you know me, saying I'm just not going to hire that carrier again.

Speaker 2:

And here's the rationale. It's like any time you hire anybody, whether it's a W-2 or a contractor, if they don't show up and you end up getting the short end of the stick, like they're not going to pay. You Hire someone to do your landscape and they don't come for two weeks. They're not sending you money. Like I hire an HVAC guy and they just don't come for three days and I got to hire someone for more money. Like the company that didn't show up isn't going to pay me. I paid an employee to start a job and they just don't show up. No call, no show their first week of work. Like they're not going to send me money. Like it kind of works that way in every other instance in commerce For sure, a hundred percent.

Speaker 1:

All right. So a couple of examples of not necessarily bad situations, but just, you know, things that'll happen in normal business. You've got the and this is how the conversation started driver assist or lumpers. Okay, so what these are? And they're similar but they're different. So a lumper is when there's a third-party service at a loading or unloading facility, where these are essentially day workers, that they have a set rate I'll load your truck for this amount, I'll unload your truck for this amount. And it's common practice and you'll know these when you're working with a customer. It's very common in like the grocery and produce world, where you know they're going to say, hey, when the driver gets there, they're going to have to pay a fee to this lumper company to get loaded or unloaded, et cetera. Here's the rate. And then you have to decide how are you going to handle that lumper, and I've seen lumpers from $80 up to $200. I've seen them even higher than $200 in some cases. Just depends on the complexity of it. But that lumper service or that lumper company is going to expect payment. Then right, which means there's a couple of ways to go about doing this. Very common is for you, as a broker, to issue a advance to that driver maybe a comm check or an EFS check, whatever the case might be and say hey, here's $200 advance to you. You can go cash out the truck stop. They're going to expect payment when you get there. All good, right. Another option I've seen too is driver pays, it gets the receipt, sends it in and you reimburse them when they get their payment.

Speaker 1:

Now the interesting part here is think about advances. Advances for lumpers are very common, but usually when you advance a driver money, there's usually a fee associated with that. Maybe it's 3%, maybe it's somewhere around there. But if I'm a carrier and I get advanced $200 and I have to eat a $6 fee out of that because of your service, I think that that's wrong on the broker to do that, which is why a common practice in our company we'll advance 206, whatever amount it takes for the fee to be eaten by us and the driver to get their full amount. Like that's how we'll handle it. It just is what it is. Um, we'll always make make right with it. Um, drivers, you know the other option.

Speaker 1:

Like I said, they can send a receipt in and get you know full pay that way. But why should they have to wait for some other third party to get paid. Why should they be holding the ball on that? Very important to make sure that you ask your customers what their policy is with lumpers. What's the cost? Is there a certain documentation in it? Because then you've got to go and invoice your customer for that lumper. So let's say I had a $1,000 line haul and a $100 lumper just to give you even numbers. Right, if I don't prove with a receipt that a lumper was paid, the customer is not going to reimburse me for that and I've got to pay the driver, right, if I advanced it or they sent in a receipt to me or whatever.

Speaker 1:

And this is where, back to your, your discussion about having to go into these third party systems and have it done the right way. So common, like, if your lump or receipt is not uploaded in the right system within the right timeframe, um, with the exact dollar amount down to the penny, it will get rejected by a lot of these systems. So keep that in mind. Um, the other one is the uh, driver assist. Keep that in mind. The other one is the driver assist. So this is where the actual driver themselves and it's less common, but driver themselves might be pulling a pallet jack or, you know, offloading boxes, et cetera. Very important to let your driver know ahead of time if there is going to be a driver assist required or involved, because not all truck drivers are created equal when it comes to their physical abilities and their age.

Speaker 2:

So I've seen and it's also a preference right. Like you're going to hire somebody, tell them the full scope of the work you're hiring them for, right. Like if they've got a physically loaded truck, like you should confirm that with them to make sure that's okay. People have disabilities, people have bad backs, like periodically, permanently, like there's lots of reasons why you need to disclose this before they get there.

Speaker 1:

One is just like the right thing to do and it's just kind of shitty to just have a guy show up and just realize he's got to load a truck Right, and yeah, this is I've seen it too, Like in the, your smaller truck load, like if you've got like your sprinter vans or if you've got like a, a cargo van, and these are not dock height vehicles. So a lot of times it's smaller, expedited things that need to be manually loaded and they, you know, you might get the load. The order and they're going to say this requires a driver assist. Driver must be able to lift 50 pounds minimum. Right. So here's the other one. Yeah, I ran into this one.

Speaker 2:

Yesterday I was working on a bid for a tire company. One of the notorious ones back in the day were floor-loaded tires. Like I worked with a broker who shipped a lot of them and like they were all driver assist and they were horrible to cover. Because as soon as the driver found out what it was and that it was driver assist like they wanted and rightfully so they wanted paid for the work they knew they were going to have to do, right, and then the shipper doesn't want to pay it. But it's like this guy's going to have to like think about if you've ever seen a truck floor loaded with tires. It's literally thousands of tires that are literally carried in, stacked one by one all the way to the ceiling, from the back of the truck to the front of the truck. Like they would take three and a half hours to load those things. The driver's doing that himself. Like I would want at least 350 to 500 bucks if I'm a driver to go do that.

Speaker 2:

And it's like then brokers try to get away with it. Like, oh, I'm just not going to tell the guy and see if I can negotiate down later. Like one like you're going to complain as a broker, your job's hard, but like you're probably doing some things that is making your job harder. Like these things. Like yes, again, the job is always difficult to negotiate and to be able to do these things. Like it's not easy, but if you're transparent, you avoid so many headaches that you create for yourself by trying to lie to carriers, deceive them, not tell them information, too lazy to communicate the information back and forth. Like to me. Like that's just you're poor at your job and like this is part of the requirements. Like this is what the?

Speaker 1:

job is another one too is like the extra stops. So if you've got multiple stops and I've seen, you know, I've seen brokers that the let's say it picks up and we'll make this up. Let's say it picks up in buffalo and goes to boca, right from where I lived, you live Broker knows that there's an extra stop along the way in Memphis, yeah, memphis, right, and you just tell the driver afterwards. Call the driver after you loaded.

Speaker 2:

Hey, they added a stop 500 miles out of your way. It's driver assist. It's going to add six hours to your transit time plus the stop. Can you do that for an extra 150? Like it's going to add six hours of your transit time plus the stop. Can you do that for an extra 150? Like it's?

Speaker 1:

Yeah, yes. So I mean be upfront about this stuff. And you know the extra stop thing that we've had other discussions about it, but that stuff you have to remember it's not about the mileage, right, it's about how much is a driver's time worth in a certain day and that $1,200 mark that you give. That that I know that's a benchmark that a lot of folks use. Did you figure two bucks a mile of six hundred? If you figure two bucks a mile and six hundred miles in a day, right Rough benchmark.

Speaker 2:

So yeah, you know, be very honest and upfront with with carriers about this, especially if you intend to have good, long-lasting relationships with your carriers, which should be a goal of yours. Yeah, here's the other one. This isn't I wouldn't call this accessorials, but when you were talking about extra stops, I see this in bids a lot and where it'll say, like I saw this, like this week, it didn't say drop trailer, but it like phrased it in the bid in a way that like they might ask for a drop trailer, right, and like they, like you could tell they intentionally worded it vaguely, as if like hey, we're not going to require this, but like it might be necessary. And I can't remember the exact phrasing, right, but like my first question, anytime, I see that is like you got to figure out the terms of the drop trailer. Like my first question, anytime, I see that is like you got to figure out the terms of the drop trailer. For instance, like we've had a customer that is chicken drop trailer. Like you can leave the trailer there. The driver can leave and come back in four hours. The load is loaded. That is one kind of drop trailer. We saw the other one this week where they want 48 hours of drop trailer before they pick it.

Speaker 2:

Guys, I'm like these are not the same prices. Like you can pay a driver a couple extra hundred bucks to go early, leave his trailer and maybe go, take some time and come back and get a load. That is one rate. But if I got to pay a power only and a leash trailer to take that trailer on Monday and then another carrier potentially power only to come back and pick it up Wednesday, I got to pay a line haul. I got to pay two or three days of trailer rental before the load's even in it. And then I got to factor in what it is and I'll see shippers try to word this where they're intentionally vague to get you to bid it as like line haul. And I've seen brokers have worked with us that they've even said it's like oh no. Like I think I can still book this with a spot truck.

Speaker 2:

I'm like you can't book that, you can't run that load with a spot truck. Like there's no way you're going to convince someone to take a trailer there, come back three days later for the same price to book a pickup from A to B. And shippers will intentionally do this to get you to put in rates and then they'll come back and make you feel like you did something wrong, but like it is your responsibility as a broker to clarify these things and ask these specific questions what is it? How often is the drop trailer? How long do you need it on site? What is the average time to load, to pick up right? What does it look like on the other end?

Speaker 2:

Because not all drop and hook even, for example, are created equal. Sometimes there's a trailer pool that sits there We've talked about this with your stuff Might sit there for like all time. Like you just need five trailers on site all the time. Well, you've got to factor that in to what you are charging this customer, because you're paying to lease trailers that are literally just going to sit in their parking lot and they're going to utilize as an extension of their warehouse. Like that is not the same as a shipping rate, line haul and fuel 100%.

Speaker 1:

So the verbiage I'm glad you pointed, pointed out, the verbiage that I saw most recently on on the bid was live load or uh, like yeah, live load, yes or no, and it was so ambiguous.

Speaker 2:

That's exactly. That's exactly what I saw.

Speaker 1:

So it's like live load price. If it's not a live load, what's your price? And but then you're like, okay, if you know. If it's not a live load, exactly, am I expecting a driver to drop it off the night before, take his reset and then 10 hours later show up and it's ready to go? Or is it? Hey, they want it there two hours before because they don't have enough space and it would be too congested to have everyone there too early. Or is it? Yeah, you need to have at all times five trailers sitting here that we can use at our disposal.

Speaker 1:

So, yeah, very man, I've seen like that was the same one as the spectrum of it be like, because the the staging of trailers can be very profitable or it could cost you a lot of money if it's not done right.

Speaker 2:

So and if you don't know the information, you're not quoting it correct. That is exactly the scenario that mine said. And then what we got back like the bids are being awarded this week. So we got the feedback from like three weeks ago, yesterday, and it was like hey, are you approved to drop a trailer at whatever lows? Oh, and it's a 72 hour drop trailer pool and I'm like, well, wait a minute.

Speaker 2:

Like we quoted this like month ago, I'm like none of those rates are going to cover 72-hour drop trailers at a facility. We didn't quote this anywhere in line with the work they're expecting. Right, it would be like me going hey, can you cut my grass? How big's your yard? Eh, not that big, maybe 20 square feet. You come over and I got two acres. Hey, you're going to do that for 50 bucks, like no. And then they're going to complain like, well, why didn't you put this in the rate? Well, how about you provide all the information so we understand the work you want us to perform, instead of vaguely referencing things and hoping somebody just doesn't notice?

Speaker 1:

takeaway on all of this is communication Like that is. That is what will make or break the relationship with your carriers, but more I mean more specifically here with your, with your customers and a lot of these bigger customers. Um, they know that they've got the leverage because you should be so lucky to have my business.

Speaker 2:

So every one of those instances this week. All very, very large companies that everybody knows their name are fully aware of, and they were all exactly like that Live load or other Live load, yes, yeah.

Speaker 3:

Yeah.

Speaker 1:

But, yeah, good discussion. Those are a handful of basic accessorials that you'll run into. I know you alluded to Dredge has its own suite of accessorials. Ltl has its own suite of accessorials that we could dig into on another episode, but those are the common ones that I think you'll see in full truckload.

Speaker 1:

So, be aware, ask the question. These are like, if you're like, what do I say when I'm talking to a shipper, this is a great question, a great point of discussion because and not to go down a rabbit hole, but we mentioned, like with detention and layover like nobody wins there. If you can figure out a way to save your customer money because you can be an extension of their supply chain as a logistician and help them reduce the amount of times that they're paying detention and layover and things like that, you become a value add. You help save them money. You're going to most likely get more of their business and definitely more of their trust. Good stuff here. Anything else in the assesorials that you want to hit on good, good stuff here any final, uh, any anything else in the accessorials you want to hit on?

Speaker 2:

no, I mean, we did a pretty decent feedback. The thing I would wrap with is like you can turn these things into opportunities. Let's just take the one of live load, yes or no. If I'm having a conversation with that shipper, I'm I'm gonna go like hey, just wanted to understand kind of the terms of when and how often you would require a drop trailer. They're likely going to tell me the other thing I'm pretty, it's a pretty good guess. Everyone else is looking at the same as me and most people probably aren't going to ask that question.

Speaker 2:

Which means my next question is out of curiosity every time when you guys do these bids, do you get a pretty high rejection rate on these loads? Yeah, we do. I'm like, huh, that's not really. I kind of guessed that they're going to go. Oh, why is that? Well, let me ask you, why do you guys kind of put your bid out in a format that just says like live load yes or no, and the answer is almost always the same? Because that's the way we've always done it, okay, well, hey, you know, it'd be really helpful maybe the next time bid.

Speaker 2:

Just food for thought is like if you put in your notes under the accessorial tab on your excel sheet which all of them have the details maybe you should add the terms of your drop trailer situation you'll probably have a lot less rejections because, as the trucking company or the broker bidding on this, we'll just have a better understanding of what you need so we can price it accordingly. I know there's always the incentive to try to get the lowest rates possible, but it's also a big headache for you. If you contract a hundred companies on 50 lanes and half of them don't pick up every week and you got to go to the spot market. Right, you're helping them help themselves in a way that comes across as like a consultant, value added and somebody that they're going to want to trust to be able to work with. Right. You can turn these things into positives if you just reframe them.

Speaker 1:

Absolutely Very, very good point. All right, final thoughts, and we'll wrap up here.

Speaker 2:

Whether you believe you can or believe you can't, you're right.

Speaker 1:

And until next time go Bills.

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Benjamin Kowalski

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Nate Cross

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