The ripple effect of lumper fees

For the past decade, a new word has been creating a lot of controversy in the shipping industry, and that word is “Lumper”.  Just saying the word creates so much anger around carriers and drivers, and adds frustration to shippers. The lumper services used to be an extremely rare occurrence in the late nineties that no one expected it to be the behemoth that it is today.

A lumper service is a mandatory fee charged to a driver or carrier in order to make a delivery at a receiving warehouse. That fee is often reimbursable to the driver by the shipper or the freight broker. You may feel it doesn’t make any sense and wonder why you would have to pay a company to receive their own products.  If nothing else, it sounds like a conflict of interest.

For the larger company, it’s about the bottom-line and reducing liability - nothing new there. The benefits for them are numerous.  They can bring a third party onto their receiving docks that they do not have to pay and they do not have to carry that liability insurance for those people working the receiving docks, since they are not employed by them in the first place.

Here’s the problem for the drivers:  They often have to deliver to warehouses that receive shipments after regular business hours when there is no personnel in the dispatcher’s office to take care of those lumper payments.  Instead of issuing a ComCheck or a T-check to those drivers, they are then left frustrated having to look for an ATM or pay out of pocket if they are so lucky to have it themselves. The lumper fees could start at forty dollars, and increase to upwards of five hundred dollars with no real justification. Now you can understand the driver’s anger when they would call in advance to be ready for the lumper and can’t even get a real sense on how much they will have to pay when arriving at that warehouse.

The problem lumper services create for 3PL’s (Third Party Logistics) is even greater. At any given time a shipper could add a few stops with one trailer for multiple deliveries with specific appointment drop times. It is the job of that 3PL to schedule those appointments, so when a driver gets held up with lumper payments at one receiving dock, it creates a domino effect where every single stop after that will have to be rescheduled.  This not only adds onto personnel hours, but it’s worse when the stops that follow can’t even provide you with the proper delivery time, thus causing your driver to accrue layovers and extra costs.  At this point you are dealing with an extremely pissed-off driver and a very angry shipper or shippers depending on the remaining stops.  This isn’t even including the buyers of those same customers screaming for their merchandise with empty shelves and the consumers can’t get what they need in a timely fashion.

For the shippers, it’s also a major headache when their customers are threatening to stop carrying their products if they cannot make timely deliveries.   Some customers have even gone as far as to demand that they fire their current carriers, who really didn’t create the problem in the first place.  Recall that this all started with the aforementioned lumper services.  The other problem:  Fraud by drivers creating false lumper receipts that the shippers have no way to verify, simply because sometimes you have side deals between receiving docks and drivers.  It’s not a common thing, but it is the reality.

In my humble opinion, there should be some regulation to assist everyone in understanding how those lumper services are charged and a way for the driver to understand how much they will have to pay prior to their deliveries.  In the end, this will save everyone involved time and money.  Until then, contact Track Logistics Group for help with lumper fees to eliminate the headache for you and your personnel.   The time and stress saved will be felt immediately.