Drayage Capacity Needed: Why Product Sitting in Ports for Days is Hurting Companies

Posted by Port City Logistics on Sep 23, 2021 10:55:18 AM

Drayage capacity, or drayage transportation, refers to the movement of goods over shorter distances, usually in the final stages of the transportation process. Still, it can occur at any point during transportation. Examples include a truck loading cargo at a local port, the distance covered during a border crossing, and the most common type of drayage: a delivery to a location in the same general area. While drayage shipping covers a minimal number of miles compared to other modes, it accounts for a disproportionate amount of fees, expenses, and delays. Managing drayage capacity, reducing delays, and keeping cargo moving is critical for successful and profitable transportation management and logistics planning. Doing so will help avoid these 6 common issues related to drayage.

Poor Visibility

When it comes to drayage capacity management, visibility throughout the supply chain and with 3PL partners is a must. When the end-to-end path of cargo cannot easily be monitored and tracked, delays are much more likely. And increased delays mean increased charges.

Subpar Customer Service

Poor drayage services can affect profit margins andthe customer experience. It also affects their access to information about their shipments. Without good tracking and monitoring tools, customers are left in the dark about the status of their cargo and often get caught off guard when it comes to additional fees they might incur.

Higher Inventory Carrying Costs

Drayage capacity management can also impact overhead expenses and inventory costs. When cargo costs more to transport and move, it often translates into higher rates and costs that usually get passed on to the customer. This increases costs that come with trying to manage warehouse inventory and ship products in general.

Limited Ability to Fulfill Orders

Delays associated with drayage capacity can impact the ability of shippers to fulfill orders and complete deliveries promptly. When orders get delayed for any reason, it affects the productivity of the entire supply chain. This, in turn, can damage the company’s reputation and its rapport with customers.

Higher Risk for Demurrage and Detention

Delays mean more fees and higher expenses overall. The average charge per container for detention and demurrage fees hits $200, according to a 2021 study by the Harbor Trucking Association and TradeLanes, released in early February. Greater delays in unloading containers almost always mean a greater chance of demurrage and detention charges

Delays to Other Ships/Carriers

Drayage capacity issues can also trigger a chain reaction of negative events. For instance, a delay at one port can delay an entire truckload for the rest of the shipping journey. A three-day delay at the port will translate into a delay of three or more days to the final delivery, unless time can be made up elsewhere during transportation. 

Improve Drayage Capacity With Port City Logistics

Staying on top of drayage capacity and improving end-to-end visibility and logistical management requires innovative tools and professional collaboration with team members and third parties. Take steps to strengthen drayage management today with innovative services and tools from Port City Logistics.

Topics: drayage capacity