Getting full visibility of rail shipments

There may be situations where you want to see certain rail shipments (either in a railroad provided, third party, or in-house rail shipment tracking system), but your company is not “party to the waybill”.

If you are running into this problem. Here are some options to consider.

1. You can get an authorization letter from one of the companies that are listed as one of the significant parties on the waybill. What is a significant party? It varies by railroad, but shipper, consignee and payer of freight seem to be most common across the Class Is. The letter needs to be on the significant party’s letterhead and state, “We hereby authorize [your company name here] to view or obtain waybill documents and car location messages (CLM) pertaining to our rail shipments.” Email this to the railroad EDI (electronic data interchange) department or sometimes called “eBusiness” department. You can get the contact information from the railroad customer service center or contact me and I’ll send them to you. For some, this may involve more work because there may be many different companies involved, thus many letters. You only need authorization from one of the parties on each waybill. Plus, some railroads require a new letter each year. Another kink in this approach is that the companies that are on the waybill, may not want to give you visibility of all of their shipments and most railroads have limited filtering capabilities.

2. If the first option does not work for you, my other suggestion is going to require that you purchase the waybill and CLM data and to put it into either your own in-house system or a third party rail shipment tracking system. Only Option 1 will allow you to continue to use a railroad provided rail shipment tracking system. You will need to get the data from a company that is a Railinc RailSight^ value added reseller (VAR). Note that you may need to purchase a bundled system with the data, but it can still be cost effective.

Why not just get the data directly from Railinc? The main reason is that Railinc will only accept letters of authorization that grant visibility and access to all waybills and CLMs. They have tools that can greatly filter the data stream, but they will not include that in the authorization agreement. The VAR will be able to use these tools to filter the data to the required subset – more on that in a minute. Secondly, if you are a small to mid-sized shipper, you pay more than needed because to do business directly with Railinc RailSight, you need to pay a $1,000.00 monthly minimum. Typical monthly data costs for a fleet of 100 railcars is $150.00 or less depending on how the railcars move. VARs will charge you for the data fees only or will at least have a smaller monthly minimum.

Here is what you do:

Get Company A (the significant party on the waybill) to write an authorization letter that goes to Railinc giving the Railinc RailSight VAR authorization to view and access all of Company A’s waybills and CLMs.

Whoa, why don’t authorization letters need to go to each railroad that moves the shipments in question? Because Railinc Corporation is the technology group for the Association of American Railroads (AAR) and has a central database that stores the waybills and CLMs for all* rail shipments in North America. They are the only organization that has virtually all railroads in North America reporting in to them all the time for all rail shipments. They actually assess financial penalties to railroads for not getting the data in on a timely manner. The database was originally created to keep track of how much railcar owners (mainly railroads back then) owed each other for the use of each other’s railcars.

Company A writes a second authorization letter that goes to the Railinc VAR giving your company authorization to view and access to waybills and CLMs for a subset of its shipments – the ones that involve your company. The VAR then uses the more advanced filtering that is available to them through the RailSight system to dial in just the right data feed. This data feed may be filtered by a list of railcars and a whole bunch of other stuff like origin, destination, billing road, route, load/empty status, car owner, car lessee, car type, commodity, shipper, consignee, beneficial owner, care of, freight payer, notify party 1 & 2, account of, shipped by, reporting road, bill of lading sender, bill of lading receiver, and UMLER pool. Of course there is a cost for this and you are probably going to pay $0.15 to $0.25 per waybill and around $0.025 per CLM.

3. A final option to consider, but one I don’t recommend. You could use the two letter strategy as stated in the second option with another company, typically a value added network (VAN), that has the ability to get waybills and CLM data from the railroads, but it is probably going to be more expensive and less reliable. More expensive because the VAN will need to retrieve all of the Company A waybills and CLMs from the railroads first and then filter that down to the subset that your company wants to see. They are going to charge you something for retrieving the whole volume; they will probably charge you for the filtering setup; and then they will charge you for the subset delivered to you. Less reliable because if the name of Company A (remember them? the significant party on the waybill) changes their name, then each railroad must be notified of the change; this increases the chance of human error by the number of railroads that are involved.

You see, the Railinc VAR can create the filter directly on the RailSight system – one filter for over 500 railroads. Plus, only the subset of data is ever retrieved. I may be sounding a bit like an advertisement for Railinc here, but I have been a customer with two other companies that get waybill and CLM data from railroads and I am familiar with the way they assess fees. For each record or kilobyte that is retrieved from the railroad, they assess a fee. For each record or kilobyte delivered to the customer, they assess a fee.

I hope you have found this helpful. If you have some additional insights, please post a comment! We will all be richer for it.

All the best,

Jim

* OK, you sticklers out there are going to point out that shipments on the obscure Mexican FIT railroad and perhaps a few others are not reporting into Railinc at this time. The bottom line, it is highly unlikely that any of your rail traffic is not visible on Railinc. Over 500 railroads report in to them.

^ RailSight is a trademark of Railinc Corporation