Freight Rate Calculation: What Affects Your Shipment Rates?

Interested to know what affects the quotes you’re given for your shipments?

Use this breakdown of freight rate calculation to help you understand your rates.

Freight Rate Calculation & More

Shipping costs are rising on up. In fact, US business logistics costs increased by 11.4% last year. 

So what exactly affects the quotes you receive for your shipments? If you’re trying to learn how to calculate freight rates, you’ve come to the right place! A number of factors play a part, but we’ve narrowed it down for you. 

Keep reading to discover the factors that play a part in freight rate calculation.

Get A Freight Shipping Quote

AZ Contracting Services, LLC is the Best In The West when it comes to our freight and logistics services. Get your service quote today by calling (623) 584-7010 or click the Contact Us button!

1. Time of Year

That “’tis the season” jingle or scorching summer weather can both impact your freight rate. Normal seasonal trends (such as produce seasons and Christmas tree season) can impact your rates. 

When these seasons hit, more trucks are needed.

When truck supply becomes an issue, it drives rates up. 

Try to keep these trends in mind when planning for big shipments. For example, produce season starts in the spring and continues through early summer. Leading up to produce season, try to establish relationships and forecast to avoid delays with your own shipments.

2. Flexibility & Speed

Helping drivers and trucking companies plan ahead can reduce idle time.

Remember, wasted time wastes money. 

If you’re more flexible about when you need items picked up and delivered, your rates won’t skyrocket. Instead, drivers and trucking companies can help you find the best truck for the job. 

ELDs are trying to keep the roads safer with higher compliance levels. This can also impact your freight rate calculation. If there are additional transit requirements, such as a team service, your rate may also go up. 

Try to consider the most efficient method. Your loading and unloading time can increase efficiency, which in turn maximizes the time drivers spend on the road. By remaining flexible, you can improve turnaround times and reduce that rate.

3. Mileage and Weight

One of the largest factors when determining your freight rate calculation is hauled miles. Deadhead miles influences the rate, too. 

How close is the pickup or delivery point from the driver’s next load?

Empty miles could increase your rate.

According to the U.S. Department of Transportation, most freight moves short distances, with 37% of freight traveling less than 100 miles.

Shippers also measure costs based on the load. What’s the shipment density, weight of the shipment, and freight classification?

You can calculate your less-than-truckload freight rates here.

Some shippers decrease your rate per-piece if there’s a larger quantity of goods. Meanwhile, some shippers consider the wear and tear and fuel required for heavier truckloads.

4. Disruptions

Unforeseen factors pop up all the time. Consider a hurricane or flood. These natural disasters could impact the entire supply chain and require shippers to make adjustments.

Needing to make last-minute changes could influence your rate.

5. Lane-by-Lane

The entire flow can also influence rates based on a lane-by-lane basis. 

For example, rates are lower when truck drivers compete to reduce empty miles. If they’re trying to find capacity, on the other hand, the rates will go up.

Can they re-load after making your delivery? Shippers will consider this as well. 

5 Factors that Impact Freight Rate Calculation

These five factors can impact your freight rate calculation, so plan ahead!

Contact us for help with your next truckload. 

Get A Freight Shipping Quote

AZ Contracting Services, LLC is the Best In The West when it comes to our freight and logistics services. Get your service quote today by calling (623) 584-7010 or click the Contact Us button!