Accessorial Charges

Accessorial charges represent a complex but vital component in the supply chain. These charges ensure that the transportation of goods remains flexible and adaptable to the dynamic demands of modern commerce. This glossary will help you understand accessorial charges and enable you to navigate this terrain confidently, keeping costs in check and timely deliveries.

What are accessorial charges?

Accessorial charges are extra fees that shipping companies charge for services beyond the basic pickup, transport, and delivery of goods. These charges can vary widely and significantly impact the shipping costs.

The different types of accessorial charges are:

Detention charges

These charges apply when a carrier's equipment, such as a truck or container, is detained at the pickup or delivery location for longer than the allotted time. This can be due to loading or unloading delays or other factors such as customs clearance.

Layover fees

These charges apply when a driver spends an extended period at a location away from their home base, usually a night. This can be due to unexpected delays, restrictive driving hours, or simply having to meet delivery schedules.

Re-delivery charges

These charges apply if a delivery attempt fails due to an issue on the receiver's end, such as an incorrect address or unavailability.

Inside delivery fees

These charges apply when the driver or carrier's personnel must go beyond the typical delivery area, such as transporting goods inside a building or up a flight of stairs.

Fuel surcharge

This charge depends on the current fuel price and fluctuates accordingly. It compensates the carrier for the increased cost of operating their vehicles.

Hazardous material handling

Carriers levy accessorial charges to cover the additional precautions, equipment, and documentation necessary to transport hazardous materials safely.

Notification services

Carriers may charge for this service if shippers or recipients require advance notifications regarding delivery times or other details.

Storage charges

These charges occur when a facility, such as a warehouse, stores a shipment for an extended period before delivery. This may be necessary if the shipment cannot be delivered immediately or if the shipper or recipient has requested storage.

Accessorial equipment

Some shipments require specialised equipment, such as a liftgate for unloading heavy items. Accessorial equipment charges cover the use of such specialised tools and machinery.

Other common accessorial charges

Address correction:

COD (cash on delivery):

Saturday delivery:

Oversize/overweight charges:

Pallet jack charges:

Liftgate charges:

Toll charges:

Border clearance fees:

What is the impact of accessorial charges on supply chain operations and costs?

Accessorial charges can have a significant impact on supply chain operations and costs. Businesses need to understand these charges and how to negotiate them to reduce their overall shipping costs.

Budgetary impact

Accessorial charges add extra expenses to the shipping process. Companies must account for these charges in their budget to avoid unexpected financial burdens.

Customer experience

Delays caused by accessorial issues can result in late deliveries and disappointed customers. Businesses must consider the potential for accessorial charges when planning their shipping schedules.

Operational efficiency

Efficient supply chain management can help to minimise accessorial charges. For example, businesses can reduce detention charges by ensuring their shipments are ready to be loaded and unloaded when the carrier arrives.

Risk management

Hazardous materials and specialised services carry inherent risks. Accessorial charges ensure carriers take the necessary precautions to mitigate these risks, protecting the cargo and the environment.

Sustainability

Accessorial charges linked to fuel consumption can encourage more sustainable practices. Carriers and shippers may seek ways to reduce fuel surcharges, leading to greener transportation options.

Transparency

Understanding accessorial charges fosters transparency in supply chain agreements. Shippers and carriers can have clear expectations and agreements regarding these charges, reducing disputes.

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Infosys BPM uses live enterprise framework, digital technologies, and data-driven analytics to provide innovative logistics process outsourcing solutions. Our advanced systems can efficiently manage and optimise these costs, minimising them whenever possible. By leveraging technology and data insights, we help our logistics clients streamline operations, improve cost-effectiveness, and enhance customer satisfaction. Infosys BPM can help you achieve more cost-effective and efficient logistics operations, even when accessorial charges are involved.