Calculating Chargeable Weight by AirFreight and Ocean Freight

Calculating Chargeable Weight by AirFreight and Ocean Freight

May 2, 2024

When it comes to calculating chargeable weight for shipping, it’s crucial to understand that the actual weight of a package may not always be the same as the chargeable weight. Chargeable weight is determined by considering either the actual weight or volumetric weight – whichever is greater. This means that large but light packages could end up being charged based on their size rather than their actual weight. Companies use this method to ensure fair pricing and efficient use of space in transportation.

Calculating chargeable weight accurately can help businesses optimize their shipping costs and streamline logistics processes. By paying attention to both the actual weight and volumetric dimensions of packages, companies can avoid unexpected charges and maximize space efficiency in shipments. Understanding how to calculate chargeable weight also enables businesses to negotiate better rates with carriers based on accurate data, ultimately leading to cost savings and improved operational efficiency.

Explanation of chargeable weight in logistics:

In logistics, carriers use chargeable weight to calculate shipping costs. It may differ from the actual weight. Carriers typically pick the higher value between actual weight and volumetric weight.

  1. Actual Weight: This is the direct measurement of a shipment’s total weight, determined by weighing it on a scale.
  2. Volumetric Weight: Also known as dimensional weight, it’s a calculated weight based on the shipment’s size or volume. Used when a package’s size doesn’t match its actual weight. To find it, multiply the package’s length, width, and height, then divide by a volumetric divisor provided by the carrier. This helps consider the space the package takes up.

The chargeable weight is decided by comparing the actual and volumetric weights, choosing the higher one. Carriers use this to calculate shipping costs, accounting for both mass and space occupied. This ensures fair compensation for transporting goods by air, ocean, road, or rail. Understanding chargeable weight helps businesses plan logistics and budget accurately.

Air Freight:

Air freight, also termed air cargo, denotes the conveyance of goods via aircraft. It stands as a swift and efficient method for shipping items over extensive distances, especially in urgent scenarios. Commonly, air freight serves the transportation needs of perishable goods, high-value commodities, and items necessitating rapid delivery.

Noteworthy characteristics of air freight encompass:

  1. Swiftness: Air freight ranks among the quickest modes of transport, making it ideal for time-sensitive deliveries. Items can reach their destinations within hours or days, depending on the distance.
  2. Global Accessibility: Air freight empowers businesses to dispatch goods to nearly any destination worldwide, fostering connections between distant markets and advancing international trade.
  3. Dependability: Airlines adhere to stringent schedules, ensuring reliability and consistency in shipments. This reliability proves vital for businesses with strict delivery requirements.
  4. Security: Airports implement rigorous security measures, mitigating the risk of theft or damage during transit. This instills confidence in both shippers and recipients.
  5. Traceability: Most air freight carriers furnish tracking services, enabling shippers to monitor the real-time status and whereabouts of their shipments.

Despite its merits, air freight may incur higher costs compared to alternative transportation modes like ocean freight or road transport. Nonetheless, the rapidity and efficiency of air freight often warrant the elevated expenses, especially for urgent or valuable shipments.

In summary, air freight assumes a pivotal role in global supply chains, furnishing a swift and dependable means of transporting goods across continents.

Factors affecting chargeable weight calculation:

Several factors influence the calculation of chargeable weight in logistics:

  1. Actual Weight vs. Volumetric Weight: As mentioned earlier, carriers determine chargeable weight based on the higher value between the actual weight and the volumetric weight of the shipment. Therefore, both actual weight and volumetric weight play a significant role in this calculation.
  2. Package Dimensions: The size or dimensions of the package directly impact its volumetric weight. Larger packages with more volume but less actual weight may have a higher volumetric weight, affecting the chargeable weight calculation.
  3. Density of Goods: The density of the goods being shipped also affects the chargeable weight. Items with low density but large volume may have a higher volumetric weight, leading to a higher chargeable weight.
  4. Volumetric Divisor: Carriers use a volumetric divisor or factor to calculate volumetric weight. The choice of volumetric divisor can vary among carriers and may affect the final chargeable weight.
  5. Mode of Transport: Different modes of transportation, such as air, ocean, road, or rail, may have varying rules and calculations for determining chargeable weight. For example, air freight often has stricter volumetric weight calculations due to space constraints.
  6. Carrier Regulations and Policies: Each carrier may have its own regulations and policies regarding chargeable weight calculation. It’s essential to understand and comply with these regulations to avoid discrepancies in charges.
  7. Packaging Efficiency: Efficient packaging can help minimize volumetric weight and, consequently, the chargeable weight. Properly packing goods to optimize space utilization can lead to cost savings in transportation.

Considering these factors and understanding how they influence chargeable weight calculation is crucial for businesses to accurately budget and plan their logistics operations.

Ocean Freight:

Ocean freight, also known as sea freight, involves shipping goods via ships across oceans and seas. It’s a key method for globally transporting large volumes of goods, offering cost-effective solutions for businesses in international trade.

Key points about ocean freight:

  1. Cost-Effectiveness: Ocean freight is usually more economical than other transport modes, especially for bulky or heavy cargo. It’s great for businesses aiming to cut shipping costs for less urgent shipments.
  2. Large Cargo Capacity: Ships can carry significant volumes of goods in one trip, making ocean freight perfect for businesses with big shipments.
  3. Global Connectivity: Ocean freight connects major ports worldwide, facilitating trade between continents. This opens up diverse markets for businesses to expand internationally.
  4. Cargo Versatility: Ocean freight caters to various cargo types like dry goods, perishables, vehicles, and oversized items. Special containers ensure safe transport.
  5. Varied Transit Times: While ocean freight is cost-effective, transit times vary due to factors like distance, route, weather, and port congestion. Businesses should plan shipments accordingly to manage delays.
  6. Environmental Impact: Ocean freight has lower carbon emissions per cargo unit compared to air freight, contributing to its eco-friendliness. However, the shipping industry should still prioritize sustainability.

In summary, ocean freight is pivotal in global supply chains, offering reliable and cost-effective transportation over long distances. Businesses utilize ocean freight to access international markets, regulate inventory, and enhance supply chain efficiency.

Different method for calculating chargeable weight

One alternative method for calculating chargeable weight is the Dimensional Weight (DIM weight) approach. Here’s how it works:

  1. Measure Package Dimensions: Determine the length, width, and height of the package in inches or centimeters.
  2. Calculate Volume: Multiply the length by the width and then by the height to obtain the package’s volume in cubic inches or cubic centimeters.
  3. Apply Dimensional Factor: Divide the package’s volume by a dimensional factor provided by the carrier. The dimensional factor represents the carrier’s predetermined conversion rate from volume to weight. For example, if the dimensional factor is 139 for air freight, divide the package’s volume by 139 to get the DIM weight in pounds.
  4. Compare Actual Weight and DIM Weight: Compare the actual weight of the package (measured in pounds or kilograms) to the DIM weight. The higher value between the two is considered the chargeable weight.

Using DIM weight allows carriers to account for the space occupied by larger but lighter packages. This method ensures that carriers are compensated appropriately for both the weight and volume of the shipment, promoting fair pricing in the transportation industr

Two Types of Weight

The carrier assesses two weight measures to determine shipment fees. First, the actual weight, also called gross weight, includes everything in the shipment, like packaging and pallets. It’s usually in kilograms (kgs).

Secondly, there’s volumetric or dimensional weight, calculated from the shipment’s dimensions (length, width, and height in centimeters). These dimensions are multiplied to get volume, and a density ratio gives the volumetric weight. Counting all packages is crucial. Like actual weight, it’s in kilograms (kgs).

Considering both actual and volumetric weights ensures a thorough assessment of the shipment’s features. This allows accurate charges based on both weight and volume.

Calculating the Volumetric Weight of Your Shipment

The density ratio applied to your shipment depends on the chosen transportation mode. Let’s calculate the volumetric weight for the same shipment using different modes:

Air Freight:

Density ratio: 1:6 Formula: ((L x W x H, in centimeters) / 6,000) x number of packages

Calculation: ((120 x 80 x 50) / 6,000) x 2 = Our shipment has a volumetric weight of 160kg.

Ocean Freight:

Density ratio: 1:1 Formula: ((L x W x H, in centimeters) / 1,000) x number of packages

Calculation: ((120 x 80 x 50) / 1,000) x 2 = Our shipment has a volumetric weight of 960kg.

Note: This calculation applies to less-than-container-load (LCL) shipments;

for full-container-load (FCL) shipments, a per-container charge replaces the volume-based charge.

Rail Freight:

Density ratio: 1:3 Formula: ((L x W x H, in centimeters) / 3,000) x number of packages

Calculation: ((120 x 80 x 50) / 3,000) x 2 = Our shipment has a volumetric weight of 320kg.

Road Freight:

Density ratio varies by location and carrier, so check with your intended carriers for full information.

Always Read the Small Print

Carriers may occasionally apply different density ratios, affecting the volumetric weight.

For instance, if you’re accustomed to using a 1:3 ratio for inland transportation but encounter a specific shipment with a 1:2 ratio, the volumetric weight of the same shipment would change from 333.33 kg to 500 kg.

So What Will My Shipment Cost?

Remember the carrier’s discretion and the principle of “whichever is greater,” comparing actual weight and volumetric weight and basing the charge on the higher figure.

This industry technique has a clear rationale; for instance, an airplane faces weight restrictions and limited belly space, necessitating control over cargo weight and volume.

For cargo containing large machinery parts, it’s typically heavy but dense. The actual weight likely exceeds the volumetric weight.

Conversely, cargo with individual plastic components in protective polystyrene packaging tends to be light but occupies significant space, potentially resulting in a higher volumetric weight than actual weight.

Your shipment’s chargeable weight is always calculated based on whichever is greater: the actual weight or volumetric weight.

Conclusions

In conclusion, calculating chargeable weight is a crucial aspect of the logistics industry that impacts shipping costs and efficiency. By accurately determining the chargeable weight of a shipment, businesses can optimize their resource allocation and reduce unnecessary expenses. It is important for companies to understand the calculation process and ensure compliance with industry standards to avoid discrepancies in billing. Utilizing technology and software solutions can streamline this process and improve overall accuracy. To stay competitive and efficient in the ever-evolving logistics landscape, it is essential for businesses to prioritize accurate chargeable weight calculations as part of their operational strategy.

FAQs calculating chargeable weight

1. What is chargeable weight?

Chargeable weight is the weight used by airlines to determine the cost of shipping, which may be different from the actual weight of the package.

2. How is chargeable weight calculated?

The chargeable weight is typically calculated as the greater of the actual weight or volumetric weight (length x width x height divided by a volumetric factor).

3. Why is chargeable weight important for shipping?

Knowing the chargeable weight helps in determining accurate shipping costs and ensures that packages are priced correctly for transportation.

4. Can I reduce the chargeable weight of my package?

You can minimize chargeable weight by using appropriate packaging and minimizing excess space around your items.

5. Are there any standard guidelines for calculating chargeable weight?

Yes, most airlines follow international guidelines established by IATA (International Air Transport Association) for calculating chargeable weights.

6. Does every shipment have a chargeable weight?

Yes, all shipments sent via air freight have a chargeable weight that determines the cost of transporting them.

7. Can I request an adjustment if I believe my package’s chargeable weight was calculated incorrectly?

It’s possible to request a review if you believe there was an error in calculating your package’s chargeable weight.

8. Is there a maximum limit on how much a package’s chargeable weight can be?

Yes, each airline has its own maximum limit on how high a package’s chargeable weight can be before additional charges apply.

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