What Are Detention Fees?
Many shippers and freight forwarders are not aware of the term "detention" or what it means. Detention is when a truck driver is unable to deliver his/her load on time due to circumstances beyond their control, such as waiting for a late shipment, bad weather, or delivery delays. detention can also occur when a driver is held up at a weigh station or other mandatory stop. Detention charges are assessed by the trucking company to cover the cost of the driver's lost time. These charges can be significant, so it's important for shippers and freight forwarders to understand how they work and how to avoid them. Thanks for reading!
Why Are Detention Fess So Costly?
Detention fees can play a major role in lost time and hinder overall efficiency, which is why they are so costly. Depending on the situation, detention fees apply to both shippers and carriers and are used to help cover the costs of lost time as well as extra expenses like food, gas and lodging. Detention fees vary greatly but typically fall around $50/hour for truckers and can be even higher for other forms of shipping. While it can seem staggering at first glance, understanding why detention fees are so expensive can help you budget for them when necessary and make sure lost time does not impact your bottom line.
How Do You Calculate Detention Fees?
Detention fees can be a frustrating and expensive part of shipping goods. To calculate detention fees, you should consider the hours that have been spent beyond the agreed-upon detention time. Typically detention fees are calculated on an hourly basis, so the more hours beyond what was stated in your agreement will result in more detention fees. Detention costs vary depending on supplier or customer agreements; it’s important to know beforehand what detention policies are in place so that there are no surprises. Keeping track of detention times can help you better understand why detention costs were incurred – but make sure to keep record to dispute any potential disputes or challenges over detention fees.
How To Avoid Detention Fees?
As a business owner, detention fees can be one of the most costly expenses you'll have to deal with. However, there are proactive measures you can take in order to avoid these detention fees. One of the best things you can do is to properly schedule and manage your labor, as well as your equipment. By ensuring that your team members and equipment arrive on time for deliveries, you’ll minimize the potential for detention fees related to late delivery. You should also work with reputable third-party companies and make sure that everyone involved adheres to their scheduled delivery windows and timelines. This way, detention will not occur from any sides and cause costly delays or fines. By properly managing your labor, equipment and deliveries with reliable third-party services, you can save yourself a lot of stress and money when it comes to detention fees down the line.
Conclusion
Detention fees are important for companies receiving any kind of shipments to consider because they can add up quickly and eat into profits. To calculate detention fees, you need to know the hourly rate and number of hours the driver is detained. You can avoid paying detention fees by planning ahead, communicating with shippers and receivers, and being flexible with your schedule. What are some tips you use to avoid detention fees at your business? Share them in the comments below!
