Many Dimensional Rating Issues and Costs Can Be Avoided With Accurate Package Dimensions
Have you audited your shipping department’s procedures for capturing package dimensions lately? It’s a good idea since this is an area where seemingly minor calculation differences can amount to significant back charges from your carriers.
Before we get into the areas of risk, here are a couple of tips to keep in mind:
- Dimensional (dim) weight, also known as cubic weight or volumetric weight, is a freight billing technique that is calculated by multiplying the (Length x Width x Height) applied to a dimensional factor, which varies by carrier and other factors.
- This is a freight calculation used by a carrier to charge for a lightweight or low-density package (such as a boxed canister of gourmet popcorn weighing 1 pound) as if it had a greater weight (such as a 1-pound bag of unpopped corn). The two weigh the same, but one takes up much more room in the truck.
- It is commonly used by DHL, FedEx, UPS, the U.S. Postal Service and other carriers for domestic and international shipments.
- The standard practice followed by carriers is to use the dim weight or the actual weight, whichever is larger, to calculate shipping charges.
- The typical calculation for dimensional weight has been (L x W x H)/166 or 139 – although it’s best to check with the carriers because they have been adjusting this number in recent years.
- Many freight carriers and 3PLs have implemented dimensioning systems to automatically measure package dim weights and calculate freight charges.
Unexpected surcharges can result when a shipper calculates the dim weight differently than it is calculated by the carrier’s system. If the carriers measurements result in a higher charge than your measurements, you will be back-charged by the carrier.
Reasons for Dimensional Rate Discrepancies
- Actual carton measurement discrepancies: One shipper found that their carton measurements differed from the carrier’s measurements.
- Carton shape: The volume used to calculate the dimensional weight may not be absolutely representative of the true volume of the package. A carrier will measure the longest dimension in each of the length, width, and height and use these measurements to calculate package volume. If the container is a right-angled box, the measurement will equal true package volume, but if it is any other shape such as a polybag, tube or non-rectangular carton, then the calculation of volume will be more than the true volume of the package.
- Data entry errors: For example, let’s say you have a shipment that weighs 20 lb., measuring 20” x 20” x 20”. The dimensions are omitted when the shipment is processed, and the resulting charge is $20.00. However, when the box crosses the carrier’s facility, its equipment captures the dimensions and calculates the dimensional rate at $40.00. You will be billed back for the difference. Multiply these kinds of errors over a 12-month period and they can add up to thousands of dollars in back-charges.
- Packing processes: For example, you’re packing cartons to be so full that the sides bulge. You nonetheless, stick to the carton size and report a 20 lb. carton at 20” x 20” x 20” for a freight charge of $40.00. If the carton is bulging out to 22” x 22” x 22”, the carrier’s dimensional system will calculate the freight to be $45.00. One of our customers, a home decor retailer, ran into this problem. Many of their cartons were packed with towels, which forced the carton to bulge out, up and down. A 24”x 24” x 24” carton suddenly became 26” x 26” x 26”. The carrier was charging back a recalculated dim weight. In this case, ADSI helped them implement a weigh-in-motion dimensioning and weighing system to generate accurate measurements and eliminate the chargebacks.
Four Best Practices to Avoid These Charges
- Implement a dimensioning system. A number of dimensioning system solutions are available to accommodate a wide range of operations. If you have questions, our shipping specialists can help you determine what is best for your company.
- Eliminate data entry of dimensions. You can also replace the manual keying of box sizes into the system with fast, accurate barcode scanning. Many of our shipping customers print a template of carton sizes and their corresponding barcodes for each carton type. The shipping operator scans the barcode instead of keying in numbers – and accuracy increases as key errors are eliminated.
- Integrate box types into the order process. Set up all of your box sizes as a series of codes that can be passed from the order system with each order when it is passed to your shipping system. If you’re using scan-based order packing software , the operator can scan a carton type as they are packing the order.
- Audit your inventory of carton types and sizes. Make it a regular practice to audit all of your carton or box types and compare them with your carriers’ measurements of the same. This can prevent back charges from occurring on future shipments.
We would be delighted to discuss your dimensioning system questions with you. Please contact us today.
Logistyx Technologies is a provider of carrier-agnostic e-commerce fulfillment software and shipping software solutions that enable shippers to manage all their small parcel, LTL postal, regional, national and international carriers on one platform. We also help companies automate their reverse logistics process for greater efficiency and lower cost.
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