Drayage

17Import-Export-Software

One of the most expensive aspects of exhibiting is material handling or drayage. Drayage is billed to exhibitors by the hundredweight (CWT) of freight for the round-trip services provided by the general service contractor (GSC). To compute drayage costs, the weight of your shipment is always rounded up to the next hundred, so 301 pounds would be calculated as 4 CWT, although some GSC’s give you a few pounds of leeway before rounding up. There is typically a minimum drayage charge for each shipment, usually 2 or 3 CWT.

The rate you’re charged for drayage is based on many factors, including where the freight is being delivered (advance warehouse versus show site), whether it’s delivered within the time frames specified in the exhibitor services manual, the type of transportation carrier delivering it (common versus specialized carrier), the kind of freight being unloaded (crated, mixed, or blanket-wrap), whether special handling applies, and if your shipment is handled on overtime.

It’s impossible to predict drayage rates with total certainty, as there are so many variables. But by understanding these factors, you’ll be better prepared to manage and hopefully lessen your drayage fees.

1. Where your freight is delivered. Shipping directly to the show site, as opposed to the advance warehouse can save you as much as $15 CWT.

2. Whether it’s delivered within the required time frame. Freight delivered outside the time frame specified in the exhibitor services manual will be subject to additional fees.

3. The type of transportation carrier. Freight arriving via common carrier is generally charged at a much lower rate than shipments sent via specialized carriers.

4. The type of shipment being unloaded. Uncrated and/or blanket-wrapped shipments can incur 50 to 60 percent higher rates than floor-loaded freight.

5. Whether “special handling” applies. Any special handling that requires additional labor, time, or equipment will result in additional fees.

6. If your freight is handled on overtime. Overtime rates can cost as much as 40 percent more than standard rates.

Consider these actions which may help you save on your drayage costs:

  1. Take advantage of discounts offered by the General Service Contractor. Some GSCs allow drayage discounts if you are using them as your shipping carrier. Don’t assume you’re saving money by using the official carrier. Get a competitive bid from a similar carrier and add the non-discounted material-handling costs quoted in the exhibitor services manual to determine which will be cheaper in the end.
  2. Choose lightweight component materials. There are many alternatives being offered today that can drastically cut down on the weight of your exhibit, thereby decreasing your material handling costs. Fabric is widely being used in exhibits. Be sure to ask your Exhibit Consultant on how fabric may fit into your existing exhibit or in a new exhibit you may be considering.
  3. Consolidate shipments. By consolidating small shipments, you do not fall victim to the minimum charges. Three 100 pound FedEx shipments would each be charged as though they were a 200 or 300 pound shipment. If all those items were sent together, you would be paying for only one 300 pound shipment.
  4. Consider the type of carrier you choose. Material-handling costs are based on how trucks are loaded and the labor and equipment it takes to unload and reload them. If you ship via a common carrier that floor loads your crated or palletized freight (rather than stacking it vertically), you’ll get the best drayage rate since it’s quick and easy to move with a forklift. Every other type of carrier that stacks freight, handles blanket wrap, mixes small loads of freight, or has small packages is considered a specialty carrier, and you will be charged a higher drayage rate for these shipments due to the additional required labor, time, and equipment. While a common carrier will save you money on your drayage and freight cost, it comes with a sacrifice on service. Make sure that a common carrier will be able to provide the level of service you require. The savings is not always worth the sacrifice! Work closely with your shipper to make sure your driver is informed of your assigned check-in time at the marshaling yard and targeted unloading date so he or she can help you avoid missed-target penalties and overtime unloading and reloading charges.
About the Author

Michelle Andersen

Michelle has been managing the finance and accounting department for over 25 years, and works with our clients regarding project finance options and billing matters.