Additionally, and just as a point of reference, drayage is a term that is mostly used in the container shipping industry. Drayage and intermodal transport differ in that drayage happens via roadways, while intermodal transport involves multiple modes of transportation. Drayage is essentially part of a larger transport chain that turns into an intermodal shipment—or vice versa.
That’s the short and sweet answer, but there’s a whole lot more involved in drayage in general. The following is something of a Drayage 101 class to bring you up to speed on this vital aspect of supply chain logistics.
Drayage: Understanding its Place in Supply Chain Logistics
As a shipper or final destination receiver, there’s a good chance you’re interested in only two or three data points. When will freight be picked up and when will it arrive? Those two data points will provide the third—how long will it take? For carriers, there’s a whole lot more involved.
If you’re a shipper or consignee (the receiver), understanding the complexity of transporting freight should provide you with some invaluable insights into what moving cargo entails—and help you better prepare.
It’s important to note that while the word dray referred to a cart or truck, modern drayage sometimes refers to the transport of cargo by sea and rail as well as by truck. In the case of truck and rail, they each make more sense for short hauls within a metropolitan area and are more cost-efficient.
Drayage is a link in the supply chain, but it’s an important one. And at times, complicated. So what are the different facets of drayage, and more importantly, why is it such a vital link?
What Are the Benefits of Port Drayage?
According to The Office for Coastal Management, 76% of all trade in the US involved marine transportation. However, 90% of all international trade arrives via ocean ports.
Since port terminals are simply a nexus in the global supply chain and intermodal logistics, transport to and from the port is necessary. This is where port drayage comes in.
The math alone conveys the importance of drayage. Think of 90% of international trade not moving—in or out—of the port. Putting math aside and getting more specific, research from FreightWaves in 2019 reported more than 60 million drayage movements every year in North America. At the time, that represented a market of more than $50 billion.
What is import drayage?
Import drayage is the transport of a container—with a number or MBL number assigned to it—from an ocean terminal to a consignee’s warehouse. Containers are then unloaded and returned. This is how to get loads from the port.
What is export drayage?
Export drayage involves transporting cargo from the shipper’s warehouse. An empty container with a booking number is sent to the warehouse and loaded, then moved via truck or rail to the Port of Loading where it’s loaded on an ocean carrier.
All of those loads coming and going is a complex process, so how is it managed?
Imagine a truck, train box, carrier ship, or anything else that didn’t take into account the goods it was transporting. Anything and everything was just piled on without any consideration to things like weight, dimensions, fragility, temperature needs, and expiry dates.
It would be chaotic and costly. This is where load matching comes in. This process involves matching a vehicle with a suitable load and is the foundation for an efficient, cost-effective, and risk-free shipment.
Key Load Matching Metrics
There are several key factors when it comes to accurate—and profitable—load matching.
Load Capacity and Weight
Every vehicle has a load capacity. Overfilling it jeopardizes more than the cargo—it puts the vehicle and the driver at risk as well. And total weight isn’t the only factor. Everything needs to be packed with balance and weight distribution in mind as well.
This has nothing to do with the height of individual pieces of cargo. It refers to how high cargo is packed onto the truck. If it’s stacked too high, you run the risk of your cargo getting stuck under a low bridge.
Stacking heavy garden statues on top of crystal stemware is obviously a bad idea. But it may be an equally bad idea to even put them beside each other. Considering fragility is a must.
Reverse Order: First On, Last Off
Order delivery routes need to be factored in when loading a vehicle, otherwise, drivers and/or loading dock workers would be needlessly offloading and reloading time after time.
Back in the day, the process of matching a load would have been done manually—and it probably took a lot of time and effort. Fortunately, here in the 21st century, technology can do the job.
Container Drayage Load Boards
First up, what is a load board?
Container load boards, which some may call freight boards or freight matching services, are online marketplaces that connect shippers and carriers. Shippers, truckers, and freight brokers can post and find container loads that are available.
Load boards for containers are typically sophisticated software that let you post or search for a load based on your set criteria. However, not all boards are created equal. The following is a list of typical features.
- Load matching. Loads are matched to carriers based on capacity and the other metrics mentioned above.
- Days-to-Pay. This is a calculation based on a company’s credit risk using the average time it takes to pay bills.
- Credit information. A company’s credit score or credit rating.
- Message board. A separate board within the board for more discussion.
- A field for notes. This could be somewhere to make notes or leave reviews.
- Federal Motor Carrier Safety Administration (FMCSA) verification. Requires a USDOT or docket number.
- An accompanying mobile app.
If you’re looking to book container loads, you can choose a load board that will best suit your needs.
When Drayage Means Something Else
To avoid confusion, it’s worth noting that the term drayage is sometimes used in a different context. It could refer to fees and mean any of the following.
- Drayage rates
- Drayage charges
- Drayage costs
And while drayage often means the short distance between a port and a final destination, it can also refer to transport to an intermodal point or terminal, or an inland/border point.
What Makes a Good Drayage Partner?
According to the Intermodal Association of North America (IANA), there is a list of classifications for drayage services. Since different goods have different transportation needs, there is no one size fits all method when it comes to drayage.
Available options are:
- Door to door. These are goods being shipped directly to the consignee.
- Expedited drayage. Used for dated products such as food or any other time-sensitive goods that need to be transported quickly.
- Inter-carrier drayage. These containers will be moved from one carrier to another, for example, the handoff of goods from truck to rail or vice versa.
- Intra-carrier drayage. Similar to the above inter-carrier drayage except that this involves freight moved between two different hubs that are owned by the same carrier.
- Pier drayage. This refers to transport driven from a hub or terminal to a pier or harbor.
- Shuttle drayage. You would choose this type of drayage when you need to move cargo from an intermodal carrier to a warehouse or other temporary destination point.
Drayage Issues in 2022
The pandemic has wreaked havoc on the supply chain, and the drayage or first-mile segment of the industry is facing challenges as well. Current issues include:
A rise in drayage rates. Estimates from June put rates at about 28% higher than last year, mostly due to port disruptions, delays, congestion, as well as equipment shortages.
Rising truck insurance costs. Over the last 10 years, insurance premiums have increased by about 47% per mile.
Driver shortages. The industry has lost tens of thousands of drivers over the last several years. Even before COVID, older drivers were retiring, but they weren’t and aren’t getting replaced by younger drivers.
Trust Loadsmart With Your Port Drayage Needs
Loadsmart’s platform connects you with data from port operators, ELD systems, TMSs, 3PLs, and WMSs. This means you have access to real-time visibility into when a container is discharged, available, or being held, and when a truck gates out. Information that ensures your containers are always returned on time, avoiding unnecessary extra fees and delays.