$12MM+ Savings in Demurrage & Detention Charges

Published on
Jan 26, 2023
Written by
Adam Baker
Read time
5 Minutes

Adam Baker

VP of Customer Experience

$12MM+ Savings in Demurrage & Detention Charges

Like many companies, this (confidential) customer started to realize they were in the dark when it came to what was really going on with their supply chain. They were relying on partners to provide them with data about where their shipping containers were at any given point in time, and to act on their behalf.

They discovered that those partners either didn't have the necessary data or their data wasn't accurate. The partners didn't know when containers were ready to be picked up, or when they needed to be returned. This resulted in millions of dollars per month of demurrage and detention charges.

The customer was wasting millions of dollars per month on demurrage and detention charges, so they decided to search for a better solution to their supply chain visibility problem.

The challenge was how to ensure they had the most accurate and complete data possible. And how to do that when every carrier and terminal has different terms and rates. And they have their own custom contracts with some. A standard one-size-fits-all solution wasn't going to work for them.

When they asked if Gnosis Freight could help, the answer was, "let's figure it out." Working with their Gnosis team, their contract specifics were broken out by carrier, lane, terminal, equipment type, and other determinants pertinent for accurately calculating each container's Last Free Day (LFD) on and off the port, as well as any fees incurred.

Previously, this process had been internally managed manually and reactively. Then Gnosis was able to engineer a demurrage and detention alarm system that began to notify the customer of containers at risk of demurrage and detention before incurring any fees.

Before Gnosis, this customer spent countless hours (and even days) organizing and understanding the data provided by their ocean carriers and freight forwarders. Now with Gnosis, these respective tasks are accomplished automatically in the background, providing unmatched container visibility and enabling timely and effective decision-making. This new level of visibility not only has allowed the customer to hold their partners accountable, but drastically reduced their demurrage and detention charges.

The results? A nearly 50% reduction in monthly demurrage and detention fees in the first month and an 80% monthly reduction by month four. As of this writing, August 16, 2022, Gnosis has helped save this customer approximately $11.8 million year-to-date on demurrage and detention-related expenses, and given them the data needed to hold poorly performing partners accountable.

Gnosis Freight’s Container Lifecycle Management platform provides the most complete and accurate visibility data of the one standard unit in the logistics industry, the container. From when the PO is cut, goods are stuffed at origin, and until the container is returned to the terminal, Gnosis tracks every milestone and provides highly accurate ETAs, ATAs, and Last Free Days.

Gnosis provides companies with full visibility of their containers globally with ocean freight tracking, rail freight tracking, and air freight tracking automatically identifying the exceptions and potential disruptions in the supply chain. This enables logistics professionals to focus their time on proactively managing the exceptions to help avoid demurrage costs, detention costs, and other unnecessary logistics costs that result from disruptions.

Want to learn more about how Gnosis can help solve any challenges you’re facing with your supply chain? 

Click here to schedule a demo.