Freight Terms Intermediate

Drop Trailer

Also known as: Trailer Pool, Drop and Hook, Pre-positioned Trailer

Definition

Drop trailer (also called “drop and hook”) is a logistics arrangement where a carrier drops off an empty trailer at a shipper’s facility to be loaded, then returns later to pick up the loaded trailer. This eliminates driver wait time during loading/unloading.

How Drop Trailer Works

Basic Process

Day 1:
Driver arrives → Drops empty trailer → Leaves

Loading (no driver waiting):
Warehouse loads at their pace
Can take hours or days

Day 2 (or later):
Different driver arrives
Hooks up loaded trailer → Departs

Traditional vs. Drop Trailer

Live Load (Traditional):
Driver arrives → Waits 2-4 hours → Leaves
Driver time: 4+ hours

Drop Trailer:
Driver 1 arrives → Drops in 15 min → Leaves
Driver 2 arrives → Hooks in 15 min → Leaves
Total driver time: 30 minutes

Benefits of Drop Trailer

For Shippers

Benefit Description
Flexible timing Load when convenient
No detention risk No driver waiting charges
Labor efficiency Load during off-hours
Staging Pre-stage outbound freight

For Carriers

Benefit Description
Driver productivity No wait time at docks
Asset utilization Trailers work while drivers rest
Schedule flexibility Plan routes efficiently
Customer relationships Value-added service

Drop Trailer Programs

Types

Type Description
Dedicated pool Trailers always available
On-request Drop when scheduled
Shared pool Multiple shippers use pool
Customer-owned Shipper owns trailers

Pool Size Calculation

Factors:
- Average loading time: 2 days
- Shipments per week: 5
- Buffer: 20%

Minimum pool: 5 × 2 × 1.2 = 12 trailers

Drop Trailer Costs

Fee Structures

Fee Type Description
Drop fee One-time charge to drop
Daily trailer fee Per day trailer is held
Extended use After free days
No-show Driver arrives, not ready

Example Pricing

Drop fee: $75
Free time: 48 hours
After free time: $50/day

Scenario:
Drop Monday 8 AM
Pickup Wednesday 4 PM (56 hours)

Cost: $75 + $50 = $125

Drop Trailer Requirements

Facility Requirements

  • Adequate trailer parking
  • Dock door access
  • Security measures
  • Equipment to move trailers

Operational Requirements

  • Reliable loading schedule
  • Communication with carrier
  • Tracking loaded/empty status
  • Return coordination

Drop Trailer vs. Live Load

Factor Drop Trailer Live Load
Driver wait None 2-4+ hours
Loading flexibility High Low
Trailer cost Fee applies None
Detention risk None High
Scheduling Flexible Fixed
Best for High volume, slow loading Quick turnaround

When to Use Drop Trailer

Ideal Scenarios

  • Long loading/unloading times (4+ hours)
  • High volume shipping
  • Variable loading times
  • Limited dock capacity
  • After-hours operations

Not Ideal When

  • Fast turnaround possible (<2 hours)
  • Limited yard space
  • Infrequent shipments
  • Short distances (driver can wait)

Drop Trailer Programs by Carrier

Major Carriers

Carrier Program Notes
FedEx Freight Drop trailer Account required
UPS Freight Trailer pool Volume commitment
XPO Drop and hook Various programs
Estes Drop trailer Regional focus

Requirements

  • Volume commitments
  • Credit approval
  • Facility inspection
  • Insurance requirements

Managing Drop Trailers

Tracking

Trailer pool status:
┌───────────┬─────────┬───────────┐
│ Trailer # │ Status  │ Days Here │
├───────────┼─────────┼───────────┤
│ TR-001    │ Loading │ 1         │
│ TR-002    │ Ready   │ 2         │
│ TR-003    │ Empty   │ 0         │
│ TR-004    │ Loading │ 1         │
└───────────┴─────────┴───────────┘

Best Practices

  1. Track all trailers daily
  2. Meet loading deadlines
  3. Communicate delays
  4. Request pickups on time
  5. Monitor charges

Drop Trailer Challenges

Common Issues

Issue Solution
Yard congestion Manage trailer count
Lost trailers GPS tracking
Damage Inspection procedures
Overstaying Enforce timelines

Avoiding Extra Charges

  • Load within free time
  • Request pickup promptly
  • Track all trailers
  • Communicate delays
  • Review invoices

Implementing Drop Trailer

Getting Started

  1. Analyze loading times
  2. Calculate potential savings
  3. Negotiate with carriers
  4. Set up yard procedures
  5. Train staff
  6. Monitor performance
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