What is drayage?

The term drayage refers to the movement of goods over a short distance, from “port to door,” ie, from a port to a nearby warehouse or distribution center.

What is drayage?

The term drayage refers to the movement of goods over a short distance, from “port to door,” ie, from a port to a nearby warehouse or distribution center. Drayage includes the transportation of shipping containers, bulk goods, or other types of cargo, and is typically performed by local carriers that specialize in these short-distance moves.

Because drayage carriers haul goods out of the port, they are the first logistics providers to interact with goods, earning drayage the moniker of being the “first mile” of the supply chain. Its impact, therefore, is critical to the shipment lifecycle. Drayage is a required step which ensures that other logistics providers can ultimately deliver a shipment to its final destination. If errors are made in drayage, it can have a ripple effect throughout the supply chain.

Drayage companies are the backbone of the supply chain and are often made up of family businesses, built through entrepreneurial spirit. Carriers may run as few as five to 10 trucks or up to hundreds of trucks, but each of these companies are important to this pivotal part of the supply chain.

Drayage vs Intermodal transportation

Intermodal transportation is similar to drayage in the sense that rail-to-rail conveyance of containers ensures that goods reach their final, ultimate delivery point. Intermodal transportation, however, signifies a move that goes from rail to rail on its journey from point of origin to final destination.

There are other differences, too. Where drayage is primarily focused on pickup and delivery from a marine terminal, intermodal is focused on pickup and delivery between rail yards, typically at an inland hub. Chicago, Kansas City, and Memphis are examples of large U.S. rail hubs where intermodal trucking companies move containers from one rail location to another.

These two types of transportation logistics can be thought of as legs in the supply chain: both interdependent on one another and serviced by carriers.

For example, a container may start its journey in China where it is then “drayed” to a marine terminal, loaded on a container ship, and ultimately picked up by another drayage trucking company upon reaching its destination in Southern California. If a container is not handled or picked up by a drayage trucker, it’s typically loaded onto rail, and is then handled by an intermodal trucking company once it reaches a hub destination. This process ensures that the container ultimately ends up in the right city and at the right warehouse.

How drayage works

A typical drayage transaction involves a drayage carrier working with a beneficial cargo owner, like Home Depot, Walmart, Toyota, etc., or a broker working on the cargo owner’s behalf. Drayage carriers receive loads that they are then required to pick up at marine terminals.

In advance of pickup, drayage operators plan their shift, day, week, or month based on their drivers’ availability, rates, assets, etc. Dispatching drivers is a critical—and hands-on—task for drayage trucking companies. Once a load is accepted and a driver is dispatched, the container must be transported from the marine terminal to a yard, warehouse, or railyard—often easier said than done.

Drayage companies often have specialized equipment and expertise in navigating the complexities of port operations, such as dealing with congestion, customs procedures, and security regulations.

Why is drayage important?

The movement of goods from the point of origin through to the point of destination is handled by logistics firms of all varieties, but several coupling points make drayage trucking particularly important:

Drayage provides the necessary first move of an import container from the port to the warehouse, allowing for the container to be unloaded and prepared for the rest of its delivery lifecycle.

Exports, too, are typically handled by drayage trucking companies as the first move in a container's journey to its final destination overseas.

As the launching point for the rest of the supply chain process, drayage plays a large, yet uncelebrated role in the modern supply chain. With the massive amount of cargo coming in through U.S. ports every day, getting drayage right is critical.

The challenges for modern drayage

While supply chain innovations over the last several years have led to turbo-charged productivity levels across all aspects of modern logistics, problems still persist. Drayage trucking businesses of all sizes run into myriad challenges today. Some of the most prevalent include:

Pier congestion: When ports and piers are overloaded, it means longer wait times for drayage carriers. This, in turn delays the delivery of goods, which can lead to increased transportation costs and reduced efficiency. Congestion can also impact equipment availability, leaving carriers with a shortage of available chassis, which causes further delays and operational inefficiencies.

Appointment challenges: Time is money in drayage and challenges such as port congestion, driver and equipment shortages, increasing port regulations, and even weather events all threaten drayage carriers’ ability to meet appointment parameters.

Asset utilization: When determining how best to utilize their assets, drayage carriers must factor in demand fluctuations, their own capacity constraints plus equipment constraints at ports, as well as downtime to do maintenance and repair on their trucks. It’s not easy to get asset allocation and utilization right.

Container availability: Port congestion, equipment shortages, container imbalances, and seasonal fluctuations can all impact drayage carriers’ ability to secure available containers. When containers are not readily available, carriers have a harder time transporting cargo in a timely way, which can drive increased costs and reduced efficiencies.

These industry-wide challenges can cause delays and logistics headaches for drayage truckers and their customers. In addition, issues arising from outdated systems and solutions are frequent. A lack of visibility into container availability and the combination of integrated systems alongside legacy software systems frequently prevent dispatchers or operations teams from scaling by doing more with less. Many drayage businesses still rely on Excel and Google Sheets, for instance, because their outdated legacy systems cannot integrate with more advanced solutions.

This lack of visibility often leads to containers and equipment being double-handled and drivers stuck waiting in line at marine terminals.

The future of drayage Technology can address many of today’s pressing drayage challenges and can help bring drayage companies into the modern age.

Transportation management systems (TMS), in particular, can be a drayage carriers’ best friend, helping to automate transportation processes, including planning, execution, and optimization. These benefits, in turn, help carriers improve operations, save time, and grow revenue.

Leveraging software in the drayage space enables carriers to operate their trucking businesses in a more efficient and effective way. With capabilities such as automated container tracking, streamlined dispatching, paperless documentation, and digital invoicing, technology solutions can help modernize drayage operations.

A tech-enabled approach also makes it easier for drayage carriers to digitally connect with partners and customers throughout the transportation lifecycle. Instead of relying on time-consuming and error-prone manual communication tasks, carriers using a TMS have an automated way to interact.

PortPro’s drayOS makes drayage management simple

PortPro is looking to usher in a new drayage-industry norm through its suite of offerings, including its flagship product, drayOS: a TMS designed with drayage in mind.

drayOS places operations at the top of the priority list to allow drayage truckers the ability to scale their business by keeping them in a “single pane of glass.” With in-app reporting, easily accessible vessel-arrival information, document management, and more all in one place, operators can empower their teams. With drayOS, users experience a modern, web-based solution that serves their needs at the right time and in the right place.

Drayage firms can take advantage of drayOS’ myriad capabilities including:

  • Receiving load tenders electronically.
  • Dispatching straight to a powerful mobile app, skipping the need for dispatchers to make multiple calls and texts.
  • Enabling drivers to accept and reject loads at the tap of a button.
  • Keeping the operations team focused and informed with real-time information.
  • Uploading documents like TIR, POD, etc. at the tap of a button through the mobile app.
  • Enabling drivers to accept and reject loads at the tap of a button.
  • Looking for more information on the technological innovation of transportation management systems? Myriad software companies offer modern TMS options, sharing a wealth of information and resources for those looking to make the leap from outdated tools to a streamlined, automated approach to transportation management.