As part of the budget planning for your trade show marketing event you need to calculate your anticipated cost for services. One of the biggest logistic costs you’ll incur is drayage (the handling of your materials and equipment from the dock to your booth). Calculating that cost should be straightforward, right? The reality is that the calculation for drayage is far from easy.
Packing and Shipping Methods Drive Drayage Costs
The way you pack your materials, how and where you ship your materials are the key elements to determining drayage costs.
Let’s review shipping destination options first so you can determine the optimal packing method for your materials.
Drayage rates are based on CWT (weight per 100 lbs,.in the US, 112 lbs. in the UK) multiplied by base rates established at each show. In addition to the base rates at each show the rates can also vary based on the timing of the delivery and difficulty of the materials’ handling factor.
|Cost per CWT||Description|
|$76.72||Shipments Direct to Show Site, Crated|
|$83.51||Advance Shipment to Warehouse|
|$99.78||Direct to Show Site Shipment with Special Handling (i.e. glass)|
|$112.19||Direct to Show Site, Uncrated|
Once you’ve established the rates for the show you now need to decide how best to ship to the show. When it comes to shipping destinations there are two choices: Advance Warehouse or Direct to Show Site.
Many people pick the lowest rate because they think it will be the most cost effective. At first glance it does look cheaper to ship crated material to the show, but the difference in cost to use the Advance Warehouse is almost always worth it for a couple of reasons.
One of the primary reasons to ship the the Advance Shipment Warehouse is to eliminate logistical stress. Material sent to the Advance Shipment Warehouse arrives at your booth faster. In fact, material it is typically at your booth location before you can gain access to the trade show floor.
Having your material at your booth right at the start of the day allows you to quickly take inventory of your material and allows you to start setting up immediately. It also provides you the benefit of extra time should you have to react to any last minute issues that might arise as you unpack and setup.
Another good reason to use the Advance Shipment Warehouse option is that shipping Direct to Show is very time frame specific. The smaller the shipping and dock window the greater the probability is that your shipping company will charge you more to meet the constraint of those smaller delivery windows. So in fact the minimal savings of $7 per CWT for Direct to Show will typically be offset by much higher costs for delivery.
Now that we understand the shipping option pros and cons let’s review how packing can affect your costs. Consider the following real-life examples.
Company A has years of trade show marketing management experience and fully understands the nuances of drayage and related costs. They wait until they have everything they are sending to a show and they palletize it all right down to the last pen. This planned consolidation exercise results in one three hundred pound pallet which they ship to the Advance Shipment Warehouse.
Company A’s drayage costs will be:
|Material||Weight x Cost per CWT||Drayage Cost|
|Material on a pallet (1)||300 lbs x 83.51||$250.53|
Company B has has been going to trade shows for years too, but rely on the individuals attending the show to determine what they will send. The sales administrators arrange for shipping of material as requested. There are often several items which are shipped independently and sometimes a day or two before the show. Actually, they often have to ship items overnight at the last minute as people remember items they forgot.
Company B’s drayage costs will be:
|Material||Weight x Cost per CWT||Drayage Cost|
|Equipment on a pallet (1)||150 lbs. x 83.51||$125.27|
|Box of giveaways||20 lbs. x 83.51||$83.51|
|FedEx Data Sheets:|
|Box 1||10 lbs. x 83.51||$83.51|
|Box 2||10 lbs. x 83.51||$83.51|
|Box 3||5 lbs. x 83.51||$83.51|
|Pop Up Booth from storage facility||100 lbs. x 83.51||$83.51|
|FedEx Letter (POI)||10 oz. x 83.51||$83.51|
By not consolidating materials and sending an envelope last minute to the venue, Company B’s costs were 250% more than Company A’s even though the overall total of material shipped was less.
Planning your packaging and shipping is critical is to keeping your drayage costs down.
If you must send anything last minute and it can be carried or wheeled, have it sent to your hotel room. There usually is hotel handling fee, but it will be significantly less than the cost of drayage at the trade show venue.
Control Your Drayage Costs!
Out of all of the variable costs related to trade show planning drayage is one of the highest. From a cost per mile transported it is by far the most expensive way to move your materials. In some cases it can cost as much if not more to move your material from the venue loading dock to your booth than it does to move it across the country.
Drayage costs are not about to go down. In fact drayage rates have risen by double-digit percentages over the last few years, mostly due to exhibitors using increasingly cutting edge, lighter weight booths. To offset the lower weight of these exhibit properties, drayage charges per pound have increased. This means your variable cost exposure is only going to go up which make planning for drayage even more critical.
Hopefully this article helped you to better understand the hidden costs associated with drayage, how to reduce it across your shows and allow you better apply your trade show marketing budget to revenue generating activities.
Thoughts and Comments?
Are you with a company that successfully plans, manages and executes trade show marketing programs? Do you outsource, do it in-house or use a combination of the two? Has your trade show marketing budget been impacted by drayage? Do you have some tips and tricks on this topic that you’d like to share with other readers?