Understanding Accessorial Charges in LTL Shipping

For businesses that regularly use Less-than-Truckload (LTL) shipping, understanding accessorial charges is crucial to managing shipping costs effectively. While base shipping rates cover the cost of moving goods from one point to another, accessorial charges are additional fees that may be incurred for services beyond standard transportation. These charges can significantly increase the overall cost of a shipment if not properly accounted for. In this blog, we’ll dive into the most common types of accessorial charges, their impact on total shipping costs, and strategies to minimize these fees.

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Common Types of Accessorial Charges

LTL carriers typically charge for extra services that fall outside their standard operations. Some of the most common accessorial charges include:

1. Liftgate Service:
   If a facility does not have a loading dock, a liftgate is required to load or unload the freight. This service typically incurs an additional fee.
2. Inside Delivery or Pickup:
   If the carrier needs to transport freight inside a building, beyond the immediate loading or unloading point, they will charge for inside delivery or pickup.
3. Fuel Surcharges:
   Carriers often apply fuel surcharges to account for fluctuating fuel prices. This surcharge is usually a percentage of the shipping cost and varies depending on fuel price changes.
4. Detention Charges:
   Carriers may impose detention charges if the truck is held at a facility for longer than the allotted time, which is typically around 30 minutes. After that, detention fees are charged per additional hour.
5. Re-Delivery Fees:
   If the carrier is unable to deliver the shipment on the first attempt due to the consignee being unavailable or other circumstances, a re-delivery fee may apply.

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How Accessorial Charges Impact Shipping Costs

Accessorial charges can add up quickly and unexpectedly increase the total shipping cost. These fees are often difficult to predict if the shipper doesn’t fully understand the scope of services needed. For instance, failing to request a liftgate in advance or not notifying the carrier that a shipment requires inside delivery can result in additional fees. In some cases, accessorial charges can represent a significant portion of the overall shipping cost, especially for small businesses that may not have the same negotiating power as larger companies.

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Tips for Minimizing Accessorial Charges

Managing accessorial charges starts with clear communication between the shipper and carrier. Here are some strategies to help reduce or avoid these fees:

1. Accurately Describe the Shipment:
   Ensure that you provide the carrier with detailed information about the shipment, including its dimensions, weight, and any special handling requirements. This reduces the likelihood of surprise fees.
2. Plan Ahead:
   If you know that a shipment will require a liftgate, inside delivery, or any other special services, notify the carrier in advance. Requesting these services upfront ensures that the costs are included in the initial rate quote.
3. Negotiate with Carriers:
   For businesses that frequently use LTL shipping, it’s possible to negotiate lower accessorial charges with carriers, especially for services that are regularly required. Building strong relationships with carriers can also help in getting better rates.
4. Use Technology:
   Transportation management systems (TMS) can help track and monitor accessorial charges, providing visibility into what’s being charged and why. This can help you identify patterns and take proactive steps to minimize these fees in the future.

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Partner With a 3PL That Offers Transparency Into Accessorial Charges

Understanding and managing accessorial charges is essential for businesses that rely on LTL shipping. These fees can add up quickly, but with careful planning, clear communication, and the use of technology, businesses can minimize unexpected costs. By staying informed and proactive, companies can keep their shipping expenses under control and avoid surprises at the end of the billing cycle.

To further streamline your LTL shipping and avoid unnecessary charges, consider using Amrate, Amware’s powerful Transportation Management System (TMS). Amrate helps you gain real-time visibility into accessorial charges, manage shipping costs more effectively, and even allows businesses to save over 30% annually on LTL. Learn how Amrate can optimize your shipping operations today.

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