One of the many factors affecting LTL rates are what are known as “accessorial fees.” These include any charges applied when additional services are required to handle shipments. They are oftentimes applied and assessed after the shipment has been made, thus making them a very challenging factor to include in transportation budgets. While base rates represent the main portion of LTL freight costs, accessorial fees can easily add up leading to a significant increase in the total expense. Understanding the impact that accessorial fees have on your overall expenses can go a long way, and in some instances may even help in reducing or waiving them altogether. Here is a list of just a few of the most common LTL accessorial fees and what you can do to reduce or avoid them.
Common LTL Accessorial Fees:
Fuel Surcharges: These are the most common accessorial fees charged by LTL carriers and are typically included on every shipment. This additional charge is due to excessive costs of diesel gas and is applied as a percentage that is based upon indices published by the U.S. Energy Information Administration. Fuel surcharges can vary by carrier (or 3PL/broker), so it’s always import to look at your total net costs when doing comparisons.
Lift Gate Service Fees: Lift gates enable carriers to lift and lower shipments from the ground to the truck and vice versa. Shippers usually require this service when the shipping or receiving address does not have a loading dock and since having this equipment costs carriers more money, an additional charge is required from shippers. The cost of this service can vary widely by carrier, so it’s important to find the right carrier with an acceptable fee if you have many of these types of shipments.
Oversized Freight Fees: Most shipment pieces that are equal to or exceed 12 feet in length, usually require more space thus leading to an accessorial fees applied by carriers. Again, this fee varies by carrier and can often be reduced.
Residential Fees: Carriers typically charge additional fees when they are required to navigate residential areas to pickup or deliver shipments. This fee may also apply to your business if it is located in a residential zone (among personal homes). Again, this fee varies by carrier and can sometimes be reduced.
Reweigh and Inspection Fees: If the carrier suspects that the weight or classification of your freight is inaccurate, they will charge a fee to reweight and re-class the shipment. For this reason, it is important to enter accurate weights and descriptions (including NMFC item numbers when available) to your bill of lading.
Limited Access Pickup Fee: Carriers may also charge fees when they pickup or deliver shipments at limited access areas such as schools, prisons, military bases, convention centers, construction sites, airports, ocean docks, wharfs or piers. All of these fees can be negotiated depending upon your specific situation.
Fees for Additional Services: There are many other instances – too many to name here – when carriers will add an accessorial charge. Other examples include; having to enter “inside” a building to pickup or deliver a shipment, collecting (“COD”) the sale price of goods shipped, and notifying consignees before making a delivery (“appointments”). Carriers will generally publish complete details regarding all of their accessorial fees in a “Rules Tariff” and make it available on their website or upon request.
Reducing / Waiving LTL Accessorial Charges
Now that you are aware of the different types of charges that may be applied to your shipment, it is important that you put that knowledge to good use. Take the following steps to ensure you never overspend on your LTL rates:
- Track, measure and record the characteristics, dimensions and weight of your shipments. This way you will be able to foresee potential charges and even dispute any errors in billing by carriers.
- Use an experienced and qualified third party logistics provider such as Logistics Plus to analyze and audit your freight invoices and negotiate rates and accessorial fees with carriers on your behalf.
Our LTL experts help thousands of companies save on their LTL shipping every year. We can provide you with a no-obligation freight analysis for multiple shipments, or we can help you get a quick and accurate freight quote for individual shipments.