The most cost-effective way to ship products overseas is generally by container via air or ocean freight.
Transport companies calculate shipping charges for exporters and importers differently based on the mode of transport.
Shipping Costs by Type of Carrier
Ocean shipments typically use volume weight to determine transportation costs. Volume weight is a cubic measurement that describes the shipment fitted in to volume containers, calculated as length times width times height. The standard Full Container Load (FCL) is a 20-foot or 40-foot square container.
Fees for shipments via truck and railway are also computed using volume weight; however freight costs based on actual weight can be applied instead. Transport companies calculate both the volume weight and the actual weight of an export or import load, then apply whichever has the higher number to calculate shipping costs for the products.
Air transportation employs a volume weight calculation based on the cubic size of a shipment. In practice, the total volume weight of an air shipment depends on the number of master cartons into which the load fits.
Calculating Volume Weight for Ocean, Truck and Railway Freight Charges
Before calculating volume weight, shippers must first know the cubic measurements that the results must be in. Countries using Imperial measurements use cubic feet while those depending on the metric system use cubic meters.
For an Imperial measurement load that is 240 inches long by 240 inches wide by 240 inches high, multiplying those 3 measurements results in a total of 13,824,000 cubic inches. To convert to cubic feet, that amount is divided by the conversion factor of 12 inches times 12 inches times 12 inches (or 1,728).
The resulting volume weight for the load is 8,000 cubic feet.
A second example is in order: a cargo load from a country that uses Imperial units has to be converted to metric units. The shipment is 200 feet long by 100 feet wide by 50 feet high, resulting in a volume weight of 1,000,000 cubic feet. To convert to cubic meters, one divides the cubic feet number by the conversion factor of 35.2876 (3.28 feet times 3.28 feet times 3.28 feet).
The volume weight in metric units for the second load is 28,338.6 cubic meters.
Perhaps the easiest volume weight calculation is when converting from cubic centimeters to cubic meters.
A shipment load that is 400 centimeters long by 200 centimeters wide by 100 centimeters high has a volume weight of 8,000,000 cubic centimeters. When divided by a conversion factor of 1,000,000 cubic centimeters (100 centimeters times 100 centimeters times 100 centimeters), the resulting volume weight is 8 cubic meters.
Calculating Actual Weight for Truck and Railway Freight Charges
The actual weight of a shipment is the physical weight measured in pounds or kilograms. Again, the choice of measurement system depends on a country’s preference for Imperial or Metric units.
A shipment typically fits into a number of boxes each of which weighs the same. So the calculation of actual weight involves weighing a box, then multiplying the per-box weight times the total number of boxes in a load.
Cargo with a weight measured as 10,000 pounds to be delivered in a country that requires metric units must be divided by a conversion factor of 2.2. The result is 4,545.5 kilograms.
A load weighing 5,000 kilograms that has to be converted to pounds is multiplied by a conversion factor of 2.2 for a total of 11,000 pounds.
Calculating Volume Weight for Air Freight Charges
To express volume weight in metric units, cargo shipped via air transportation is measured in volume kilograms.
If the initial volume is measured in cubic centimeters, the formula is length in centimeters times width in centimeters times height in centimeters divided by 6,000. For loads in cubic inches, the formula becomes length in inches times width in inches times height in inches divided by the conversion factor of 366.
Therefore, a load of 12,000 cubic centimeters converts to 2 volume kilograms. A load of 12,000 cubic inches equals 32.8 volume kilograms.
For Imperial measures, pounds kilograms are used. The formula to derive pounds kilograms is length in inches times width in inches times height in inches divided by the conversion factor of 166.
A load of 50,000 cubic inches is the equivalent of 301.2 volume pounds.
Reference:
David M. Neiport, A Tour of International Trade (Prentice Hall 2000).
 |
