In a complex supply chain there’s a lot that can go wrong. As carriers complete shipments, payments are released by brokers once they are sure that the freight is as promised, without any damage or issues.
When problems do arise, brokers might choose not to pay the total amount due to the carrier (or, extreme cases, the broker might have gone out of business and be unable to pay). The delayed freight is held up somewhere, waiting on funds to be released: this is known as hostage freight.
A hostage load scenario impacts everyone and can be costly, as well as time-consuming. So how can you avoid hostage freight scenarios, and what options do you have if you find yourself in one?
What are the reasons for freight being held hostage?
Depending on the type of businesses involved, hostage freight can have different meanings. Usually, hostage freight is held when a carrier doesn’t deliver a shipment until the shipper can pay the transportation debt to the carrier. Alternatively, although less commonly, a third-party logistics (3PL) may request that the carrier holds onto a shipment – holds it hostage – until it has received payment from the shipper.
There are all kinds of charges a shipment or carrier can incur which will need resolving before a shipment can continue its journey. These can include…
- Destination change
If the shipment’s destination changes after it has been picked up by the carrier, this will impact the carrier’s route, plans and mileage, incurring a charge.
- Significant changes in load details
Many carriers will charge for shipments that change load details, for example of the weight is higher or lower than expected, if the shipment is larger, even a different temperature.
- Potential claim
If a carrier is aware of a potential issue, such as debts or unpaid charges on the shipment they are due to transport, they may refuse to deliver until they are confident they will get paid in full.
How to prevent hostage freight
The key to preventing your goods being held hostage is communication; by notifying carriers of changes to shipments, destinations or inventory as soon as possible, you can mitigate any charges that might be applied and avoid a “stand-off” situation. This applies to brokers and any other links in your supply chain, too.
A thorough understanding of your supply chain, your facilities and common issues that may have cropped up before can also help you to prevent problems arising, or at least communicate effectively and find a solution quickly when they do.
A bonus by-product of this effective planning and communication is the creation of long-term partnerships with carriers and brokers, so you can find a seamless logistics solution with dedicated carriers and lanes for your business.
Avoid freight challenges with Sprint Logistics
Partnering with an expert in worldwide shipping like Sprint Logistics means you don’t have to worry about issues like freight hostage. With our global network of warehouses, carriers and brokers, Sprint Logistics ensures your goods are delivered quickly and efficiently to anywhere in the world.
Relying on a third-party provider takes the headache out of logistics; instead of worrying about shipments, you can focus on growing your business while we take care of your freight. The Sprint Logistics team has the expertise and know-how to ensure forward planning and communication that prevents hostage freight.
To find out more about how partnering with Sprint Logistics could benefit your business, get in touch today.