What is EPS (Equipment Positioning Surcharge)?

Definition of EPS

Equipment Positioning Surcharge (EPS) is an additional fee imposed by shipping carriers to cover the costs associated with repositioning empty containers to locations where they are needed for loading cargo. This surcharge is often applied in situations where there is an imbalance in container availability, requiring carriers to move empty containers from surplus areas to deficit areas.

Importance of EPS

1. Balancing Container Supply and Demand:
Ensures that empty containers are available at key loading points, facilitating the continuous flow of goods.
Helps address regional imbalances in container availability, which can be caused by trade imbalances or seasonal demand variations.

2. Operational Efficiency:
Supports the efficient management of container fleets by enabling carriers to reposition containers as needed.
Minimizes delays and disruptions in the supply chain by ensuring that containers are available where and when they are required.

3. Cost Recovery:
Allows carriers to recover the costs associated with repositioning empty containers, which can include transportation, handling, and storage expenses.
Ensures that the financial burden of container repositioning is distributed among shippers using the service.

4. Sustainability:
Helps optimize the use of existing container fleets, reducing the need for new container production.
Encourages efficient routing and container management practices, potentially lowering the environmental impact of empty container movements.

Components of EPS

1. Calculation:
The amount of the surcharge can vary based on several factors, including the distance containers need to be moved, the mode of transportation, and regional demand and supply conditions.
It is typically calculated on a per-container basis and added to the overall shipping costs.

2. Application:
EPS is applied by carriers to shipments originating from or destined for locations with significant container imbalances.
It can be applied to both import and export shipments, depending on the specific logistics needs and market conditions.

3. Notification:
Shippers are informed about the EPS at the time of booking or through carrier tariffs and rate schedules.
Clear communication ensures that shippers are aware of the additional charges and can plan their logistics budgets accordingly.