The Secret to Combatting the Hidden Costs of Detention Time
Lengthy loading dock wait times have plagued the trucking industry for years, with serious consequences for drivers and shippers alike. Detention time—typically defined as greater than a two-hour wait—affects driver efficiency, shipping capacity and safety, with a negative financial impact for all stakeholders. And the problem is widespread. According to a survey by data analyst DAT Solutions, nearly 63 percent of drivers spend more than three hours at the shipper’s dock each time they are loading or unloading.
If the Wheels Aren’t Turning
“If the wheels aren’t turning, you’re not earning.” This old adage rings even truer with the heavy burden detention time places on drivers. According to data in a white paper by J.B. Hunt Transport, of the 660 minutes (11 hours) of available driving time, an average of only 390 minutes (6.5 hours) are actually spent on the road. Drivers waste significant time on inflexible appointments and waiting to load and unload.
In addition to not being paid for weather delays, time spent sitting in traffic jams or waiting at border crossings, many truck drivers are not compensated for the hours spent waiting to load and unload freight. Despite a movement within the industry to institute more equitable driver compensation, many drivers are still paid by the mile. Consequently, time wasted waiting to load or unload represents lost income—and it’s not pocket change.
The Inspector General’s audit report estimated that driver detention is associated with a $1.1 billion to $1.3 billion decrease in annual earnings for U.S. truckers. This shortfall translates into a loss of income of between $1,281 and $1,534 per driver per year, or 3.0 to 3.6 percent of a driver’s average annual income. Similarly, detention time reduces net income of for-hire motor carriers to the tune of $250.6 million to $320.9 million each year.
Safety Concerns
According to the most recent data from the Federal Motor Carrier Safety Administration (FMCSA), in 2015, 415,000 crashes occurred involving large trucks. Detention time increases the risk of these crashes by encroaching on drivers’ available waking hours, contributing to fatigue when they are on the road. Indeed, the FMCSA report indicates that detention increases the likelihood of truck crashes involving fatalities or significant injuries.
A mere 15-minute increase in average dwell time—a combination of detention time plus time spent loading and unloading freight—increases the average expected crash rate by 6.2 percent, or the equivalent of one additional crash per 1,000 tractor-trailers or straight trucks on the road. Additionally, the report found that, on average, every 5 percent increase in stops that incur detention time results in a 4.7 percent increase in expected crash rates.
Shipper Impact
As much as detention time frustrates carriers, shippers are shooting themselves in the foot if they are unable to streamline their operations to efficiently manage loading and unloading at their warehouse or distribution center. In addition to hindering supply chain performance and damaging carrier relationships, long load dock wait times impact labor costs, requiring overtime compensation for employees who must stay late to accommodate delays.
Shippers incur detention charges intended to compensate drivers for undue time spent waiting to unload or load. Fees typically range from $50 to $100 per hour for any delay longer than two hours. In addition, shippers can face chargebacks from customers who are unhappy about not receiving merchandise by the agreed-upon delivery date.
With the newly instituted ELD rules, a renewed focus on wait times is spurring major carriers and owner-operators alike to drop shippers that habitually impede freight movement with long wait times. In this same spirit, some carriers have launched “shipper of choice” programs to prioritize shippers who minimize wait times for drivers. Given the freight hauling capacity crunch currently facing the industry due to the one-two punch of driver shortage and rising demand, shippers cannot afford to be blacklisted or they will face a serious challenge to cover their loads.
Dock Appointment Scheduling
Implementing drop-and-hook systems and designating “live-load” dock doors are helpful tactics for improving loading and unloading efficiency, but forward-thinking shippers are using technology to significantly reduce detention time and take control of their inbound and outbound operations.
Web-based dock appointment scheduling solutions enable shippers, carriers and consignees to collaboratively schedule dock door appointments online. By distributing the responsibility of scheduling appointments across all stakeholders, dock appointment scheduling technology provides greater control over freight delivery and allows organizations to proactively minimize wait times. Carriers avoid frustrating detention time and shippers can manage inventory more efficiently, which reduces labor and supply chain costs.
With technology-enabled dock appointment scheduling, carriers can recoup their time by minimizing inflexible appointments and reducing dwell time to increase capacity. Estimates in the J.B. Hunt paper indicated that, by eliminating just 30 minutes at the shipper and 30 minutes at the receiver, the extra hour a driver could remain on the road each day would be equivalent to 50 miles per day, or 12,500 miles per year (assuming the driver spends 250 days on the road annually).2 These carrier savings translate to increased supply chain efficiency, mitigated risk of road accidents, and improved operational performance for shippers.
By ensuring all supply chain partners are involved in the process and have real-time visibility into requested, scheduled, and rescheduled dock appointments, online dock appointment scheduling optimizes inbound and outbound operations. Open communication across the supply chain to ensure transparency and visibility also provides a clear audit trail to enhance compliance tracking, dispute resolution and managing chargebacks.
With greater visibility into inbound shipments, shippers can not only minimize dock wait times for load/unload activities and return trips, but they’re also able to better manage inventory levels, increase warehouse efficiency by reducing peak resource requirements, and reduce congestion by limiting idling in the yard while waiting for a dock door to become available. Dock appointment scheduling can be a real game-changer!