Calculate Shipping Cost for Air Freight: The Impact of the DIM Factor
To calculate shipping costs for air freight, consider a shipment of 50 identical cartons whose dimensions are 20in x 20in x 20in and each carton weighs 10 lbs. Based on each of the “standard” DIM factors the chargeable weight for this shipment would be:
Exhibit A - Dim Factors
|DIM Factor||Actual Weight||Volumetric Weight||Chargeable Weight|
|194||500 lbs.||2,062 lbs.||2,062 lbs.|
|166||500 lbs.||2,410 lbs.||2,410 lbs.|
|138||500 lbs.||2,899 lbs.||2,899 lbs.|
If we now apply a rate of $1.00/Lb to the shipment we will see that the expected charges of the shipment will vary dramatically when we base the calculation of chargeable weight on different DIM factors (See Exhibit A above).
DIM Factor Key to Calculating Shipping Cost
When you are shipping light/bulky products: The lower the DIM factor the greater the Chargeable Weight, hence a $1.00/Lb rate with a lower DIM factor will be effectively more expensive than a $1.00/Lb. rate with a higher DIM factor. To be competitive, a rate with a lower DIM factor must be less than a rate with a higher DIM factor. The chart below illustrates this point using our example shipment - the lower the DIM factor the higher the effective shipping cost.
|DIM Factor||Applied Rate||Chargeable Weight||Expected Costs||Effective Rate|
|194||$1.00||2,062 lbs.||$2,062||$1.00 / lb
($2,062 / 2,062 lbs. = $1.00)
|166||$1.00||2,410 lbs.||$2,062||$1.00 / lb
($2,062 / 2,410 lbs. = $1.17)
|138||$1.00||2,899 lbs.||$2,062||$1.00 / lb
($2,062 / 2,899 lbs. = $1.41)
To calculate the shipping cost for air freight, the DIM factor is critical. When comparing one quote versus another, you must know the rates, DIM factors, and the weight & cube attributes of the products you want to ship.