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Saving $400,000 in demurrage with custom multimodal shipping

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A global polymer manufacturer had an influx of containers arrive at the port of Los Angeles that needed to quickly move out of port and deliver to two inland facilities.

When their usual forwarder provided a solution that would take 12 weeks to execute, the manufacturer knew it needed to engage a different provider to keep its supply chain moving and avoid excessive port demurrage charges.

Schneider’s multimodal shipping expertise and speed-to-implement got the containers moving quickly, removing them from the port and organizing their final delivery within four weeks, saving the manufacturer hundreds of thousands of dollars in demurrage and other penalty fees.

Import surges resulting in demurrage and per diem fees?

It’s time to assess your strategy.

A global polymer manufacturer had an influx of 46 containers arrive at the Port of Los Angeles that needed to quickly move out of port and deliver to two inland facilities in Indiana and Texas; demurrage charges—daily fees that begin the day after the last free day, per container, per day until pick up—would begin in eight days.

stack of orange containers

The manufacturer’s usual forwarder provided a solution that would remove four containers per week from the port—a total timeline of 12 weeks to fully get the containers off the port and additional time to deliver to the facilities. The potential impact of this solution? More than $400,000 in demurrage fees. 

The manufacturer knew it needed another solution, and fast, as free days were wasting.

Importers facing hefty fees due to supply chain delays benefit from using nationwide multimodal providers

One day after the containers arrived the manufacturer contacted Schneider for an alternative solution. Adding to the complexity of the request were the container specifications — all were overweight and needed to move on special lanes using special equipment within the port. 

Schneider got right to work on a solution that centered on getting the containers off the port as quickly as possible to mitigate port demurrage charges, providing temporary storage and, lastly, final delivery to the manufacturer’s inland facilities identifying:

  • Third-party providers with specialty (lightweight) tractors. 
  • Chassis.
  • Transload and warehouse space located in the port’s overweight corridor.

Drayage + Transload + Warehouse + Transportation = Success

With providers in place who could handle the freight, Schneider committed to, and completed, moving all 46 containers off the port within five business days; saving the manufacturer more than $400,000 in port demurrage fees. 

As a bonus, the warehouse Schneider identified had enough square footage available that deliveries could be spaced out to meet receiving expectations – avoiding bottlenecks downstream. Schneider was able to complete the delivery of all containers to the inland facilities within four weeks.

port demurrage fees timeline

To ensure success for the storage elements of the fast-moving project, a Schneider project manager traveled to be on-site and manage the unload and transload process. Beyond the savings, Schneider provided the customer with streamlined communication, a single point of contact, and valuable daily tracking that detailed: 

  • % removed from port. 
  • % unloaded/returned to port. 
  • % departed from warehouse. 
  • % arrived at final destination.

When your supply chain is struggling, the way you’ve always done it may no longer be the right way. Reach out to Schneider, a nationwide multimodal provider with deep experience in creating tailored supply chain solutions and solve your most challenging headaches.

For more ways on how Schneider’s expertise can help optimize you avoid port demurrage fees, visit the port service page and then contact an expert to get your containers moving.

multimodal illustration of intermodal, bulk tanker and a full truck
Published August 2021

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