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Unclaimed Freight: Huge Savings Opportunity

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In that case the shipment may be sent back to the manufacturer or it becomes unclaimed freight, which ends up sitting on a shelf in the warehouse; enlist for a while.

In other cases the right item/goods may arrive, but with significant damage or in an unacceptable condition caused by the carrier. If a certain percentage of the shipment it’s damaged, its recipient right to choose whether or not he is going to accept the delivery and receive credit for the unusable products.

Unclaimed Freight Huge Savings Opportunity 1
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If he/ she refuse to take the shipment, the damaged goods then become unclaimed freight and may be destroyed, stored or sold off to third parties. Often the damage is partial and minimal, but the original buyer doesn’t want to risk for unseen problems in the products.

Very often unclaimed freight is classified as “abandoned freight” and it’s up to the freight company to deal with it. 

Once freight is unclaimed the appropriate management companies will determine what is to be done with it. They have several options, but must always ensure they are in compliance with state and federal law. The three key options are as follows:

  • They can store the freight (keep in a secured location)
  • They can destroy the freight (again in accordance with the law)
  • Just as it is done with the storage lockers, they will auction off the cargo /sell the unclaimed freight as soon as possible (after appropriate steps have been taken)

Unclaimed Freight Huge Savings Opportunity 1
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Furthermore, the Unclaimed Freight Dealers Freight management companies will deal with unclaimed freight dealers which normally have a list of potential companies, customers and individuals that are looking for a specific and particular item.

If a shipment matching a particular customer’s interests does arrive then they will try to negotiate with them a price per item or wholesale deal.

Freight companies are sitting on a goldmine as they say. These items can’t be stored forever, there simply isn’t space. Often the items have already been paid for so there is little cost (outside some legal support). Once the items are determined to be ‘officially’ unclaimed and the value has been assessed it is time to get rid of it.

Here are few ways how shippers, freight carriers and unclaimed freight dealers do that:

  • They could rent a commercial building space and offer these products at a discount price to the public or private sale.
  • Another way to do that is by liquidating the unclaimed freight through a listing service and resellers.
  • They could discard/ dispose in a landfill or dumpsite

Unclaimed Freight Huge Savings Opportunity 1
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One thing for sure, the shipping companies have to get rid of the unclaimed freight one way or the other and sooner the better! Loosing time is losing money so any container that is not moving is losing money!

Shippers are in desperate rush of finding the way to dispose of the unclaimed freight and empting the storage facility. Every extra day that the container stays in the storage/ warehouse, will cost them storage fees so they tend to get rid of the contents quickly.

There are numerous options that shipping companies have, if failure to take delivery by the consignee does occur. These are of course subject to the contractual terms and conditions of the original contract and bill of lading that was issued. Of course they also must adhere to federal, state, and local law.

Here under I will mention just a few agencies involved in the whole process that are well known to the trucking companies and they live day to day according to their ever changing rules:

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And in many cases international laws might be applicable as well. So the shipping company needs to avoid legal issues and be up on the legal matters before declaring something unclaimed.

Once it has been declared unclaimed, and all legal requirements have been met, the shipper may act. One common step is to put a lien or hold on the cargo.

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Through this they can hope to regain some of their cost for handling, demurrage, storage, and other related costs. Of course in most cases this will be covered in the terms on the bill of lading.

Usually there is a statement that covers this. It is common to say something along the lines of, “If the owner (consignee) fails to take proper legal possession of the freight/cargo in a timely manner the shipping company then has a legal right to dispose of it, at the expense of the customer, and at the sole discretion of the shipping company”. That is not the exact verbiage, naturally, but you get the general idea.

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According to the process of law a shipping company is allowed to:

  • They can unpack the shipping containers, allowing the containers to be put back in service.
  • They can place the freight in to a bonded store.
  • They can auction and/or sell the freight.
  • They can use the proceeds to offset all accrued cost.
  • They can take any and all legal action determined appropriate to regain any financial loss.
  • They can take any other steps allowed by law (either international, federal, state, and/or local) to recoup the loss.
  • If the sale price does not cover the costs incurred by the shipping company, then there is provision in international law for action to be taken against the shipper.

Unclaimed Freight Huge Savings Opportunity 1
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Before the shipping company can declare the freight unclaimed, they must make full effort to contact the appropriate party (customer, consignee, and owner). As per the information provided on the bill of lading, this can be by phone, fax, email, letter, or other preapproved communication methods.

Once this was done, especially if by mail, official notice will be consider to be the first day after it was sent. The carrier (in accordance with previous agreements) will return the unclaimed freight to the appropriate shipper; this is at the expense of the consignee, owner, or shipping company.

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They will then dispose of the cargo in a manner as seen fit. If there were no special instructions in the bill of lading also known as B/L, or other contractual agreements, and they are not received in 10 days of notification, the carrier is free to dispose of the unclaimed freight. They too can do this by sale, auction, or simply discard it as trash with no liability, if all legal steps have been observed.

When there is unclaimed freight, the carrier should try to get an abandon and indemnification letter from the customer, owner, or consignee. This should be put with the bill of lading expressing the intention is to abandon the freight. Makes this statement of abandonment includes the release of all ownership rights.

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