If you are the owner of a trucking company, determining which rate to charge customers is a vital part of operating a successful business. Rating freight requires careful analysis of your company’s operating costs, including mileage of your trucks, fuel and vehicle maintenance costs, as well as fees charged by brokerage companies. Freight rates are determined by taking these factors into consideration and applying the rate to the corresponding freight class. Setting a desired profit is also useful when rating freight.
(1) Calculate the annual costs that it takes to operate. Your trucking company. Add up all expenses, such as fuel, maintenance of your fleet (trucks), wages paid to employees, rent of your facility space and fees paid to brokerage companies. Divide the total amount by the number of miles driven in a year. The answer is your per-mile operating cost.
(2) Forecast your sales for the next year and set a goal for profit. Refer to updated fuel cost lists by region and other valuable tools to estimate your sales for the future. Use the desired per-mile profit to base the rates for freight.
(3) Determine rates for freight. If you company offers full truckload service, set the rate at an amount that guarantees profit by covering your per-mile costs. For less than truckload rates, set rates based on the class set forth by the National Motor Freight Classification (NMFC).
(4) Use established rates when receiving orders from customers. Obtain the weight, dimensions, value and density of all freight before quoting a customer with a freight rate. Negotiate the price with the customer as necessary.
If you need to ship freight to another business or if you are ordering something that comes as freight, you may want to estimate the freight charges ahead of time. Getting a freight estimate is a fairly simple process. The process is similar to getting a rate quote for shipping a package through a carrier. You may need to know a few more details than for shipping a simple package, but you can estimate freight charges on your own.
(1) Visit the website of the freight shipping company that you plan to use, such as UPS Freight or Old Dominion. Navigate to the “Rate Estimate” page of the website. If you aren’t sure which freight company you want to use, then go to FreightQuote.com to get quotes from several carriers at once.
(2) Enter in the origin and destination of the freight. For U.S.-based shipping and deliveries, you will need the ZIP code. Select the freight class code for your freight. If you are not sure which code to use, you can check the list of codes on Freight88′s website (see Resources).
(3) Get a weight for the freight. You may need someone who can drive a forklift to move the freight and weigh it for you. If the item has to be crated to be shipped and it is not yet crated, be sure to take that into account. Also get your shipment density by dividing your total weight by total cubic feet to get the pounds per cubic foot. To get the total cubic feet, multiply your outside length, width and height of the freight. Once you have the weight and density, or a good estimate of it, enter it into your online quote tool.
(4) Make any selection for special accessories for your freight shipment. This includes sending it C.O.D, getting arrival notification and construction site delivery. Any of these additional requirements will result in a surcharge added to your freight rate.
(5) Submit your rate quote form when you have entered in all the details to get an estimate of the charges. Keep in mind that the charges are just an estimate and may be lower or higher when the item is actually shipped.