Shipping freight rates are a big part of the cost of doing business. If you’re shipping large volumes, you may be able to negotiate with your freight carrier for discounts. But if you’re a small-scale business owner or sole proprietor, you probably don’t have that kind of leverage. You need to know how much shipping freight actually costs so that you can make informed decisions about your business operations.
There are several factors that affect the costs and rates of shipping through a particular carrier. These include:
The first thing that needs to be taken into account is the type of product you’re shipping. There are different rates for different types of products and services, which is why you have to provide some details about your shipment when you submit an inquiry with a shipping company — otherwise they might not be able to offer you a quote on time or at all.
Volume – The more you ship, the cheaper it gets per unit shipped. In other words, if you send only one package per month and want to ship via FedEx Express, then it’s going to cost significantly more than if you send 10 packages per month and want to use UPS Ground instead.
Weight – How heavy is your cargo? If it’s very heavy (like when we’re talking about transporting cars), then the price will go up significantly because labour costs are higher when heavier loads are being transported by air or sea. For example, if an airline needs a cargo plane full of people rather than full of luggage, it would look elsewhere.
Whether you’re shipping via truck, rail or waterway. Trucking is the most common way to transport goods, but it’s also the most expensive method — especially if you’re shipping long distances over rough roads. Rail is less expensive than trucking and can be used for shorter trips (though not always). Ocean freight is typically the least expensive option available; however, it can take longer than other modes and isn’t always suitable for expedited deliveries.
The mode of transport used by your freight carrier (truck, rail or waterway). Each mode has its own set of rules that govern everything from hours of operation to speed limit restrictions (some highways are limited to 55 mph while others allow speeds up to 75 mph). These rules are designed for safety reasons but also impact how much it costs for carriers.