Demurrage
Port storage when the container sits past free time before collection is arranged.
For CFOs
Demurrage, detention, and dead capital: measure what your P&L does not show.
Demurrage and detention invoices are visible. The working capital trapped while payment, documents, and collection drift apart often is not — especially when finance and logistics use different systems.
Built for businesses with £1M+ equivalent annual FX exposure and recurring international supplier, customer, or treasury payment flows.
Import operations are a chain: payment, document release, customs, haulage, warehouse. A delay in any step can cascade into port storage charges and finance cost at the same time.
This briefing helps CFOs measure that combined pressure without treating demurrage as only a logistics line item.
Three costs that stack
Detention
Charges when the empty container is not returned to the depot inside free time.
Dead capital
Cash debited but not yet in productive inventory while the chain is waiting on payment proof or release.
Reconciliation drag
Finance and operations time spent matching payment, invoice, and release status under pressure.
The workflow
The payment-to-warehouse chain
01Authorise payment against release needClarify whether payment is for invoice due date, bill of lading release, or shipment milestone.
02Track pipeline daysRecord debit date, proof sent, supplier confirmation, and document release — not only “payment sent.”
03Watch port clockAlign free-time expiry with realistic collection date given corridor and document timing.
04Quantify carrying costApply your cost of capital to trapped value per shipment cycle and add demurrage or detention where incurred.
Illustrative arithmetic
A business moving roughly 100 containers per year with an average shipment value around £50,000 can accumulate demurrage, detention, and carrying cost from pipeline delay in the same quarter — even when individual invoices look small.
Use the demurrage calculator and payment records together; do not rely on a single generic industry average.
Payment timelines depend on currency, route, provider approval, jurisdiction, beneficiary bank, compliance review, and banking cut-off times.
Tools and related reads
Quantify exposure
Model container and storage pressure from timing assumptions.
Payment timing
Reduce unnecessary early debit and pipeline float.
Pay-out operations
Connect supplier payment proof to release.
Education
Longer guide on demurrage and detention concepts.
FAQ
What is dead capital in import operations?
Cash that has left your account but is not yet in saleable inventory or available for other treasury uses — including time spent in banking pipelines and release delays.
How does payment timing affect demurrage?
If documents or supplier release wait on slow payment proof, containers can sit past free time at port or depot even when the commercial invoice was approved on schedule.
Should finance own demurrage analysis?
Operations often sees the container clock first, but finance should connect payment timing, proof, and carrying cost — especially on recurring import flows.
What should we measure monthly?
Count containers hitting demurrage or detention, median days from debit to release, trapped capital per cycle, and internal time spent on payment exceptions.