In fact, the entire supply chain is affected by how efficient shippers, carriers and manufacturers are with their own operations. One of the biggest hiccups in this is what's known as dwell time.
This occurs when truck drivers must wait at facilities to either pick up or drop off their loads. The longer they must wait, the more money they figuratively burn. In addition, extra wait time can cause bottlenecks in the supply chain, as load volumes can become imbalanced, arrivals could become delays and things could get missed during the on-site operation.
Companies are always searching for ways to decrease dwell time in their supply chain so they become more efficient. Here are some more details about that topic.
What Does Dwell Mean in Logistics?
In logistics, dwell is a general term that refers to the amount of time that something sits idle at a facility. This can be freight, an empty or full container or an empty or full truck.
In all of these cases, it's possible that the subject could dwell at a facility waiting for something else to happen before it can move. For example, freight is subject to dwelling if it has been delivered to a port but cannot be loaded onto a ship or truck to be delivered to its end destination.
The other two types of dwelling mentioned are described in further detail below.
What is Dwell Time Trucking?
Dwell time can refer to both trucks and containers. Dwell time trucking occurs when a truck sits at a facility waiting to load or unload cargo. This can happen for a number of reasons that are mostly related to the operation of the facility itself. If operations there are inefficient or if the load hasn't arrived on time, for instance, then the truck is likely to be forced to sit and wait before they can load it for delivery.
What is Dwell Time When Moving Freight?
Dwell time can also refer to containers. If trucks are dwelling with containers on board, then the owners of the containers are essentially having their containers unavailable to be used for the next cargo and shipment.
What is a Drayage Carrier?
Quite simply, a drayage carrier is a company or person who transports shipping containers on a truck. In most cases, drayage carriers travel relatively short distances. Their job is to pick up containers from ports and distribute them to various destinations throughout the country.
Drayage carriers are often considered the backbone of logistics in the U.S., since they are the spoke in the supply chain that is responsible for distributing imports when they come into the country. They are equally important for U.S. manufacturers who export goods, as drayage carriers are the ones responsible for delivering those products to the ports.
Drayage carriers are also subject to significant dwell time if they don't operate efficiently. This is why companies are always looking for ways to optimize their travel routes and their shipping logistics.
How Do You Calculate Dwell Time?
If you are looking at reducing your dwell time, there are a number of metrics that you must track. This will help you identify where the problems are occurring to see how you can address them.
First, look at your appointment rate, which is the number of loads divided by the number of appointments. Second, look at the compliance rate, which is the number of non-compliant loads divided by the total number of loads.
Third, assess the delay rate, which is the number of delayed arrivals divided by the total number of arrivals. And finally, calculate the average delay, which is the total delay time for each period divided by the number of loads for that period.
With this information in hand, you'll be able to see your dwell time from all angles so you can better determine where the most common problems are occurring.
What are Dwell Charges?
Dwell charges are fees that are assessed based on how long trucks and containers sit and dwell at a facility. In most cases, shippers are given a certain amount of leeway for dwelling in which they won't be charged a fee.
Once you exceed that allowable time, though, you could be charged a fee for dwelling. How much that fee is will be dependent on the location of the facility as well as the supply-and-demand in the market at the time.
Dwell charges are assessed to compensate facilities for lost time in their operations, and to incentivize companies to improve their efficiency.
How Do You Calculate Cargo Dwell Time and Dwell Fees?
Calculating cargo dwell time is rather easy. All you have to do is take the total amount of time each container is being stored and divide it by the total number of containers that are being stored. This will give you the total cargo dwell time.
Dwell fees may then be assessed based on this cargo dwell time calculation, according to the facility's rules and rate schedule.
What is Container Excess Dwell Fee?
A container excess dwell fee is charged to carriers who exceed a certain amount of dwell time for containers at ports and other shipping facilities. Facilities that use this fee will set a certain amount of time that a container is allowed to dwell at the facility.
If a container exceeds that time period, then the shipper is charged a container excess dwell fee. Again, the rate for this and how it's charged might vary from one port or facility to the next.