If you want to import your material through shipment but are afraid of a layover fee. Read this guide!
Because in this, we have explained everything about layover fees, its purpose and even the strategies you can follow to avoid it.
Let’s dive in!
Understanding Layover
A layover is actually your short stay when you are on the way, whether on flight or on other transports like trucks for several reasons. In flight routes, you switch your planes in an airline, which is known as flight layover.
On the other side, in shipment the truck driver has to stop for a while due to numerous scenarios which could happen, like waiting for the shipper or reciever, then the layover is called a layover in trucking.
Layover is mandatory when a driver could not pick up the cargo on specified time or unable to give delivery on time. Here are some factors due to which layover happens:
- A schedule issue may cause layover to happen, when a driver arrives earlier or driver arrives timely but cargo is not ready.
- In flights the layover happens due to exchange of flights at airports or flights delay due to unforeseen reasons like weather condition
- In shipment, trucking layovers could happen because of weather conditions, distance gaps, mechanical issues or scheduling gaps.
What is a Layover Fee?
A layover fee is additional fee which a transportation company surcharged the client. This could happen, when a driver has to wait extra for cargo loading, or unloading due to the client’s irregular schedule. These fees depend on the transportation company’s policies, some companies set specific layover fees while others may vary on time spent at specified locations.
Types of Layover
Here are four types of layover, you have to know:
Mandatory Layover
This layover is included in some country’s laws. In this case, a driver has to stay for a while before continuing the journey, because the driver should take rest for safety purposes. For example, a truck driver is suggested to take a break of 30 minutes after every 6 to 8 hours for a long trip. Some companies are strict enough in this case, they set policy for mandatory layover. Their aim is to give drivers a rest at specified points or on the road.
Voluntary Layover
Voluntary layover depends upon the driver’s choice. This layover may include vacations, a driver gets for her hometown and other purposes which he found necessary. As, the voluntary layover is not included in company’s policy, therefore drivers can’t receive their payment for this break.
Forced Layover
A forced layover happens when a driver feels unsafe due to several reasons like severe weather or mechanical issues with the vehicle. In this situation, the driver of trucks stops at any spot where he finds comfort. The flight pilot took off at the specific airport which related his airline.
Detention Layover
In this case, the shipment driver has to wait due to the late loading or unloading of the shipment. The delay happens because of the receiver or shipper’s unusual scheduling. The drivers get their extra pay to compensate for the time which was lost, but companies sometimes find it difficult to get layover fees from responsible parties.
The Purpose of Layover Fees
To be realistic, a layover fee is good to take for several reasons like: A transport company should have to compensate for their time as well as pay extra to their drivers because of delay in receiving or delivering the goods.
Apart from this, the transport companies are rental and they just earn money by offering services of their drivers and vehicles to clients. They allocate time to their drivers for a specific task, if their time wastes at client’s location during loading or unloading the cargoes, then it becomes difficult for them to run within that fixed cost.
Therefore, it’s the driver’s as well as client’s responsibility to pick up or drop off the load on time. The transport companies set a schedule for drivers according to expected time so that shipper freight could not affect the efficiency of the vehicle. If there is any delay for shipping, the transport has to wait and the company should be paid in compensation of that time which is referred to as layover fee.
How Layover Fee Is Calculated?
Layover fee calculation very on the specific company, but here is common method:
- Flat fee: It’s an amount paid to drivers for the time they wait for shipment. This fee is usually fixed with respect to per hour or per day regardless of the layover length.
- Percentage of regular pay rate: It’s an hourly percentage amount which transport companies set for the drivers in return to their hours they spend at layover. This percentage is set on their regular hourly pay rate. Let’s say if a driver gets 200$ per hour, he would be paid 100$ which means 50% for an hour which he stays at layover.
- Total compensation: its a case in which the layover fee is included in the overall package of the driver. This may include in the driver’s regular pay or bonuses.
The Typical Cost of a Layover Fee
The cost of the layover fee is variable as it depends on the condition that happens. A standard layover flat fee applies from 50 to 300$, an hourly 10 to 20$ also applicable, but depends upon the transport company’s policies. For more heavy transport or shipment, where time of driver and vehicle is more significant, the cost may range up to 1000$ per day.
How You Can Avoid Layover Fees?
Constant layover fee can create loss in your business, therefore these three strategies you can follow to avoid this loss:
- Fill the communication gap between client and transport company
- Set a defined time for production and delivery
- Speedup your loading and unloading procedure
Promote Communication
The layover happens because of a communication gap between the client and service providers. Information loss in between, and the transport company could not get the right information about the loading time, hence the driver has to wait ultimately for the layover fee you have to pay.
Promote this communication by creating some tools to share effective information properly. You can fulfill it by utilizing any technology like messaging through collaborative platforms. This would foster a comfortable sharing of data such as arrival of trucks, delay in shipping or loading and unloading. When this communication gap is filled, the productivity of your business would enhance as the understanding between the transport company and team is improved.
Schedule Time for Production and Delivery
Layovers usually happen when your production is not ready and the truck or transport for shipment arrives. So, in order to compensate for this issue you have to schedule a proper timeline for the production of material and accordingly arrange the transport. Try your best to meet the production cycle with bounded transport and communicate with transport providers accordingly.
Speed the Procedure of Loading/Unloading
If your aim is to avoid a layover fee for next time, then improve your loading and unloading process. You should ensure that the truck is loading on time on take off and if the truck arrives then ensure it unloads properly. Fasting the process can avoid your extra billing as well as can enhance the value of your business.
Here are some tactics you can follow to expedite your process of pickup and drop off.
- Set the products before the arrival of transport
- Hire some extra staff to speed up the loading or unloading of a shipment
Conclusion
Layover fee directly related with your business image, your worth can reduce if you continuously pay that fee to the transport company. So, being the best business organization always follows the above mentioned tactics to avoid layovers and maintain a good reputation.
