How Your Business Should Calculate Shipping Costs

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If you run a business, chances are that you ship different items. Whether it is products to customers, payment checks to employees or other things, it’s important to know how to properly estimate shipping costs. Different freighting companies charge different rates for their services. Depending upon the goods you wish to send, where their final arrival destination is, and if the package requires any type of special handling, the cost for freights may be higher. For accurate approximations, here are some tips to gage freighting costs.

How Your Business Should Calculate Shipping Costs

  1. Establish What You’re Shipping

Prior to your visit to the freighting company, find out the exact weight of the items you intend to ship. You can do this by simply weighing them on a shipping scale if you’re going to ship one item. For multiple objects being shipped, calculate the weight of one unit and then multiply it by the total number of items you are sending to find an approximate weight.

  1. Determine the Classification

Figure out where the products you are shipping fall into the National Motor Freight Classification (NMFC). This is the shipping industry’s standard of transporting goods. After you know the commodity’s specification, you will be able to package it properly according to NMFC standards. To save money, use the smallest package available.

  1. Handle with Care

If you are sending fragile items that a customer bought, you want to ensure that they arrive safely without any damage caused to them during the shipping process. Use bubble-wrap and other kinds of packaging material when preparing the object for shipment. Select a snug fitting package or box and make sure that all components of the object are wrapped securely. Afterwards, include all handling fees if the freight company you are using charges them.

  1. Insurance

Decide if you should buy insurance from the freight carrier or from a different source. You can compare insurance costs easily online.

  1. Calculate Additional Fees

Often, there will be special fees included in the freighting cost. If the package needs to be at a certain temperature or if it is extremely large, the freighting company may charge you additional fees. Estimate what these may be and factor them into your final cost for freighting.

  1. Establish a Final Cost

Finally, total all of the costs including additional fees, insurance and handling costs. Also, multiply the weight of the item times the price charged by the freight company for the NMFC classification of the object. Once you establish a final number, you can sign the shipment papers. Remember to obtain a copy for your own records.

If your company ships items, it is important to keep track of freight fees

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