What is Drayage – Meaning, Definition & How to Reduce Drayage Costs
Trade shows and exhibitions are part and parcel of a wholesaler and distributor’s life. Once you’ve sourced your unique products, you need to rub elbows and start exhibiting at booths around the country. After all, there’s no better way to announce your presence in a very crowded market of wholesale and distribution businesses.
Unfortunately, a part of expenses in setting up a booth is drayage. Dray what? This is a rather quaint word with historical origins. Nonetheless it’s an important cost in your sales and marketing efforts. If you don’t understand or comprehend drayage then you’re likely to incur substantial costs with every booth.
Dray means a truck or cart without sides, for delivering barrels or other heavy loads, this signifies that the goods to be transported are carried by cart pulled by a ‘dray’ horse.
Most specifically, it refers to the separate costing structure in the United States for carrying goods over a short distance.
Drayage is often defined as the transport of goods over a short distance in the shipping industry and logistics industry. It is part of a longer overall move, such as from a ship to a warehouse.
For wholesalers and manufacturers today, drayage can be defined as the cost of moving your trade booth essentials from the delivery vehicle to the booth area.
It is humorously described as ‘maximum payable cost to move your freight for least distance‘.
But this joke is not so funny when you are a wholesaler planning to attend your initial trade shows, hustling to set foot in the industry.
These costs are inevitable and seem irrational to the wholesaler who is not familiar with the concept of drayage.
There is only one option to perform all the drayage functions, which is the Central Drayage Company that is chosen by hyper-competitive bidding before the show.
The operations performed by them in exchange for your expense are divided in following five steps in the given sequence:
Steps involved in Drayage
- Unloading the delivery vehicle and completing inbound receiving documents
- Transferring the freight from the receiving dock to the wholesaler’s trade booth
- Short-term storage of empty crates and needless objects near the site of trade show
- Moving the unassembled freight from the booth to the receiving dock once the show is concluded
- Reloading carrier vehicles with the crates and all the extra products and completing outbound paperwork.
Why Drayage is Costly
Drayage costs can be compared to the expenditure involved in moving your freight throughout the country. These unusual high prices have some reason at least since the moving-in and moving-out time at a trade show per exhibitor is quite less and the freight handling is to be coordinated to complete the assigned work.
For wholesalers who are still at early stages need to be aware of the drayage costs, so that nothing comes as a shock.
Since there are predefined rates and prices are non-negotiable, then also exhibitors can be mindful of the fact that there are few precautions they can take before the show to minimize drayage expense.
How to Reduce Drayage Costs at Trade Shows
1. Ensure Efficient Shipping on the Site
Time is one of the key factors at a trade show.
So for unloading your freight onto the receiving docks, the right choice of carrier is necessary. This is to ensure that entire load of goods is dumped at the docks at once rather than in small batches, this way the time consumed is minimal and the moving cost to the booth is reduced.
For executing this, shipping charges from the inventory to the site is clearly high but it does not rise exponentially like the drayage costs, so it is acceptable.
2. Packaging is a Great Deal
Drayage costs can average to 80-100$ per 100 pounds in the US.
These average costs are based on the fact that your packages do not require any special handling i.e., they are not fragile and thus can be moved on a forklift.
For items, those which do not meet the above criteria are charged significantly more.
For avoiding this, you have to pack your goods in a crate. The easier for the contractor to carry your products to the booth, the less they are going to squeeze your pockets.
Thus, for reducing handling charges, your goods need to be palletized.
3. Trim the Freight Weight
Weight is one of the key factors which facilitates transport of products over a short distance.
So while packing your freight in crates, the weight of each package must be closely observed.
The drayage cost is decided for total pounds and is defined per 100 pounds.
Let us suppose that drayage cost per 100 pounds is $80.
One of your packages weighs 112 pounds, do not be fool enough to believe that rate will be implied exactly weight-wise because you will be paying $160 for the rounding off of 112 pounds to 200 whole pounds.
Thus carry only essentials and pack them accordingly.
4. Time is Money Indeed
It is a tight schedule at trade shows, because of the countless exhibitors and their immense batch of part and parcels.
Another reason is the presence of single General Drayage Contractor managing all the inputs for the show.
If you want to avoid the extra 30-35% of the total bill, you must stick to the schedule and deliver the booth items at the assigned hours.
5. Be Alert of All the Aspects
The drayage company also tend to overcharge the fresh exhibitors. Thus, keep your eyes open all the time and be acquainted with labor costs, moving charge per 100 pounds of material and other different expenses involved in the bill.
Labor costs differ up to $20 for non-fragile items and the crates which need special attention. They also differ as per the two stations between which the freight has to be moved. You got to be aware of these technicalities to get your work done on agreed rates.
To sum up, drayage costs are a pain in the back which is almost unavoidable at a trade show.
But being considerate about the above-mentioned points can help you dodge the extra barriers in the path of a successful trade show.
The basic thing to be watchful about is to carry only the things which are actually required at the trade shows. The extra load can burn up a hole in your pocket very easily!
Thus being wide-awake and efficient in every field can save the day at a trade show. After all, the margin of error is very slight.