Lumper Economics (in the grocery industry.)?

Discussion in 'Refrigerated Trucking Forum' started by Hornswoggled, Oct 12, 2023.

  1. Hornswoggled

    Hornswoggled Light Load Member

    74
    44
    Jul 25, 2014
    Florida
    0
    I work for a large truck-load carrier. On occasion, I get loads that deliver to a grocery DC. Of course, that means it's going to involve lumpers. The grocery industry is traditionally highly competitive and low-margin. But what I'm curious about is how exactly do they save money by going the lumper route?

    Of course, I have to admit that the very concept of me paying somebody to unload the goods from my trailer, that they ordered and paid to be delivered to them seems warped. But regardless . . .

    The trucking company doesn't eat the lumper fee; my understanding is that it gets passed back ultimately to the shipper. Presumably, the shipper anticipates these lumper costs coming back to them, and prices their product accordingly to recover that cost.

    So in the end, it would seem that not only does the grocery wholesaler still incur the costs (indirectly) of unloading trailers of product they've ordered, but in the process they have added numerous links in the chain (middle-men), adding additional costs and fees compared to just hiring their own staff for unloading trailers in the first place.

    What am I missing here?
     
  2. Truckers Report Jobs

    Trucking Jobs in 30 seconds

    Every month 400 people find a job with the help of TruckersReport.

  3. Kenworth6969

    Kenworth6969 Road Train Member

    2,263
    6,083
    Jul 3, 2020
    0
    Just here to I hate lumpers.

    They always take forever.
     
  4. buzzarddriver

    buzzarddriver Road Train Member

    3,203
    8,594
    Feb 1, 2011
    Dallas, TX
    0
    The receivers look at it as not having an employee they have to pay and provide benefits for. Back in the day most grocery warehouses were union, so employee costs were high.
    There weren't the lumper companies that you see today. There were guys out at the gate and you had to deal with them separately. They also gave a cut to the receiving clerks to get the load checked in faster, so they could get back out to the gate to catch another load.
    And 99% of it was via cash transaction. As an example, if you had a load going to the east coast, you would pull a $300-$400 cash advance just to pay tolls and the lumpers.
     
  5. Kenworth6969

    Kenworth6969 Road Train Member

    2,263
    6,083
    Jul 3, 2020
    0
    And then doesn't the lumper cost get passed along to the customer anyway?

    So how much are they really saving anyways?

    $400 to unload a trailer seems like a lot.
     
    Bud A. Thanks this.
  6. rollin coal

    rollin coal Road Train Member

    12,422
    23,474
    Mar 29, 2008
    TN
    0
    They probably save a boatload on workman's comp insurance they don't need to carry since contractors unload the trucks. Spread the cost of that lumper fee over several thousands of items on the truckload it's probably a penny or two of cost per unit maybe less, maybe more, depending on piece count.
     
    Bud A. Thanks this.
  7. ‘Olhand

    ‘Olhand Cantankerous Crusty

    6,282
    14,339
    Jan 18, 2011
    0
    Bottom line….WE all pay the lumper fees at the ck out line in the Grocery Store
     
    Rookie driver 956 and bzinger Thank this.
  8. Metalicious

    Metalicious Road Train Member

    1,159
    1,219
    Sep 27, 2015
    0
    Exactly what he said. All the equipment (forklifts / pallet jacks) and maintenance of the equipment the lumpers use is probably that of the lumper service to pay as well.
     
    Bud A. and Rookie driver 956 Thank this.
  9. dave01282000

    dave01282000 Light Load Member

    287
    550
    Jun 16, 2021
    Ohio
    0
    Early on I also would wonder about why it was like that, when I was sitting in a door and contemplating life. After a while it just got to be part of the routine and it really doesn't take that long when you can use your fuel card or worst case, have to message for an express code.
     
  10. Hornswoggled

    Hornswoggled Light Load Member

    74
    44
    Jul 25, 2014
    Florida
    0
    Thanks for all your responses. Don't know that we arrived at any definitive conclusions, but at least we're sharing different perspectives.

    I'll also add that on numerous occasions, I've had Procter & Gamble loads going to grocery DC's, where the receiver looked at the BOLs and stated the P&G loads had the lumper charges prepaid. Apparently P&G recognizes the extra costs and inconveniences associated with processing lumper charges throughout the logistics chain. I would hope also that P&G gives a slightly better price to non-lumper customers since they are not absorbing the lumper charges.

    One other aspect of the lumper process I'll mention (and I don't have a name for this) is that not all loads are treated the same way. On my last lumper load (which had some over-the-counter medical-type merchandise), the receiver took a look at the contents on the bills, and promptly informed me that the unload process could take "up to eight hours." I asked why, and they claimed that "we don't own this product, so we have to inventory everything on the dock and make sure there isn't anything here we didn't order." Not sure how accurate that statement was, but the idea is that they are holding the driver up in case there is something in the load they want to refuse. If so, they put it back on the truck and it's the driver's problem. Of course, besides the extra time involved here, it's extra time for the lumpers to inventory too, and we're paying for that also. That lumper charge came to around $465. Luckily, the process in my case only took about 3½ hours. I'm sure some of them do go the full eight hours however.

    If the receiver was paying a reasonable hourly charge for holding the driver up, this wouldn't be happening. Just another form of taking advantage of the situation (a.k.a. driver abuse.)
     
    Bud A. and Feedman Thank this.
  11. dave01282000

    dave01282000 Light Load Member

    287
    550
    Jun 16, 2021
    Ohio
    0
    It's actually not all bad when you can bank detention and log a 10 hour break at the same time. I had that happen at Target...at least they told me ahead of time it was going to be 10 hours so I just went to sleep.
     
    Bud A. and Feedman Thank this.
  • Truckers Report Jobs

    Trucking Jobs in 30 seconds

    Every month 400 people find a job with the help of TruckersReport.

  • Draft saved Draft deleted