Every truckload starts as a freight container. It’s no wonder this is one of the most sought after freight niches in the USA. As a broker of 15 years, container drayage has accounted for about 30% of our business year after year, so Im excited that I have the opportunity to share it with you. So, if you are wondering, what is container drayage? We are going to answer everything you need to know about it in this article.
Container drayage refers to the short-haul transportation of sea freight containers to and from ports, railyards and destination warehouses performed by intermodal carriers. Drayage containers consist of both imports and exports.
Drayage does not move like typical freight. It is primarily handled by intermodal carriers who use smaller power units known as day cabs, to transport containers from point A to point B on reusable chassis.
What is Container Drayage?
Like we said before, container drayage is a series of short haul moves typically between ports, railroads and destination warehouses. It refers to the act of transporting a sea container to be exported onto a ship, or unloaded at a warehouse to be processed and shipped in the domestic US.
Drayage moves consist of two primary types of moves that a freight broker might receive from a customer.
Import Moves – In this drayage move a carrier will be responsible for picking up a full container from a seaport or rail yard and transporting it to a warehouse to be unloaded.
Export Moves – In this drayage move, a carrier will be responsible for picking up an empty container from a seaport or rail yard, transporting it to a warehouse to be loaded and then returned for the final voyage to its destination
What Licenses do Freight Brokers Need for Drayage?
Freight broker’s are required to carry multiple licenses for their general operations. However Drayage is governed by a different set of authorities than typical over the road transportation.
While freight broker’s aren’t required to have any licenses specific to drayage, the carriers they contract to complete this work must.
Among some of these certifications are a UIIA agreement and a SCAC code. These serve as agreements on file between steamship lines and ports which allow carriers to rent their equipment with the promise of bringing it back.
This of these agreements like a library card. When you take out a book, the book is registered to your card and there is a penalty assessed to you if you don’t bring the book back on time.
Well, in drayage, there is a similar concept. When a carrier does not return their equipment on time, they will be assessed fees by either the port or the steamship carrier. The SCAC code issued by the NMFTA, allows these entities to bill the appropriate company.
PRO TIP: Keep in mind while you are performing drayage work that you will be responsible for any fees incurred by your carrier. This makes drayage a risky endeavour for freight broker’s who do not have experience in this niche.
That’s why we dedicated an entire lesson on Container Drayage in the Freight Skills Academy to equip you and protect you from getting hit with unnecessary and costly fees.
Different Types of Drayage Fees
There are a number of fees and penalties that can be assessed to freight brokers who are handling drayage work for their customers. Typically, brokers are responsible for passing these charges to their customers in order to be reimbursed.
Some of these charges include:
Port Delay – This is a charge assessed by the intermodal carrier for waiting time at a port. Typically carriers will include 1-2 hours free of waiting time and then bill after that has passed at an hourly rate previously agreed to before the shipment.
Pier Pass – A pier pass is essentially a ticket required to enter certain ports. It is specific to some ports around the country such as the port of long beach.
Terminal Handling Charge – This is a cumulative fee assessed by a port for things such as unloading the container, loading it on to a truck and the labor involved for using the container lifts and equipment.
Chassis Charge – Chassis are typically rented from a chassis depot for a short period of time in order to complete a drayage move. They carry a charge of about $35 per day until the equipment is returned.
Per diem – Containers are given what is called a “Last free day” to pick up and return the container. While the length of time varies for each container, when a container is held for longer than the last free day, the port and steamline can assess fees to the container owner in the form of per diem. Every single day the container is not returned is ultimately the responsibility of the carrier who took it from the port and the customer responsible for unloading it.
Where to Get Drayage Work as a Freight Broker
As a freight broker, it can be difficult to target customers for specific freight, but there is one niche of customers who has no shortage of container freight being moved on a daily basis.
- Freight Forwarders – Freight forwarders are responsible for the shipment of containers over the ocean and therefore have a need for responsible freight broker’s to assist them with the inland transport once they arrive to the US.
- Manufacturers – Manufacturers are always importing foreign goods into the USA. From raw materials to packaging, manufacturers have a great need for reliable brokers and intermodal carriers to help them collect their containers on time.
- Families (home-goods) – Families moving from another country typically require containers in order to relocate their homes. This is a specialized niche but a big opportunity for freight broker’s to assist with the transportation of these containers from the port to be offloaded at a customer’s new home.
Join Freight Skills and Learn Everything You Need to Know about Container Drayage
Freight skills is the only freight broker training program that contains a full breakdown of the in’s and out’s of drayage freight. Everything you need to know about performing the service and finding the customers is covered by an experienced freight broker of 15 years.
While it is a difficult niche, it is one that is very rewarding and profitable for freight broker’s. Although it can be intimidating with the different regulations, strict time deadlines and potential fees, learning how to execute a drayage move properly can prove to be a valuable asset to your and your customer’s business.
Visit this link to join the Freight Skills Academy
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