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Do you believe that the eCommerce shipment weight always determines the shipping prices? Well, weight is one factor in determining the delivery cost. Logistics providers calculate “billable weight” based not just on dead weight, but also on parameters like the box’s dimensional weight.
In this blog, you’ll learn what billable weight means, how to calculate it, and tips to reduce your shipping costs.
Table of Contents
What is Billable Weight?
Carriers use billable weight to determine the shipping price of every package, considering both the actual shipment weight and the dimensional weight. Couriers use the higher of the actual or volumetric weight as the chargeable weight, which determines your final shipping cost.
History of Billable Weight
Until 2015, carriers calculated a package’s delivery fees based on its actual weight and transportation distance. After determining that this approach was ineffective for lightweight products that took up space and lowered the carrier’s capacity, they switched to chargeable weight for shipments.
Carriers frequently encountered the issue of shippers not optimizing their packing for smaller products because they were not paid for package dimensions. That is when carriers began factoring in dimensional weight when determining transportation prices. Dimensional weight calculations help carriers to account for both the weight and density of the package.
How is it calculated?
To determine the billable shipment weight, you will require the package’s measurements in inches and the actual shipment weight. The following formula is used to determine the billable weight:
- (Length x Width x Height) / DIM
Let’s break down how to compute dead weight and dimensional weight to clearly understand how billable weight is calculated.
How is Dimensional Weight Calculated?
Dimensional weight is computed by multiplying the cubic volume of a package by a dimensional factor, often referred to as a DIM divisor. The following is a step-by-step procedure for calculating the package’s dimensional weight:
- Use the longest point of the measured height, width, and length of a package on each side
- Multiply the measurements to obtain the package’s cubic volume
- Divide the cubic volume by the DIM divisor of your carrier
How do you calculate dead weight?
You calculate the actual weight by placing the package on a weighing scale, recording the result, and rounding it up to the next full pound.
Some Methods for Lowering Shipping Costs
You can enhance your shipping strategy and reduce expenses by gaining a deeper understanding of how billable weight is calculated. The following are some strategies for optimizing your chargeable weight and lowering your shipping costs.
1. Examine Your Packaging Alternatives
Among the common mistakes that business owners make is shipping their products with incorrect packaging. While using boxes to carry all of your products may be less hassle for you, this technique may wind up being costlier for you, and it also results in a less-than-ideal consumer experience.
You may wind up using more shipping materials, such as dunnage, and different packing materials than you would if you used the proper packaging, which increases your shipping prices even higher.
By evaluating your packaging alternatives, you can be more deliberate about the packaging you select for each shipment, reducing your delivery costs and billable weight. However, tracking and forecasting transportation costs can be challenging when each shipment’s weight varies. However, a shipping aggregator like NimbusPost can assist in simplifying the procedure.
2. Change from Cardboard Boxes to Poly Mailers
Cardboard boxes have fixed dimensions and often need extra dunnage to keep products secure during transit. Using boxes for soft products like t-shirts can increase dimensional weight and raise your shipping costs.
Polybags or poly mailers are more compact and take up less space than standard boxes. They’re flexible, economical, and usually don’t require extra fillers to protect the contents. Fashion sellers often prefer them, as they reduce damage risks and ship lighter items more efficiently.
Most 3PL providers offer poly and bubble mailers in various sizes as part of their standard packaging. While not all products fit poly mailers, using mixed packaging can help reduce your billable weight.
3. Utilize Ship-in-Own-Container Packaging (SIOC)
SIOC is a product packaging method in which the consumer receives the goods in their standard packaging, without extra packing such as an overbox. Not only does this save unnecessary packaging, but it also has the potential to save money by lowering the billable weight.
4. Associating with 3PLs or Shipping Aggregators
While there are ways to reduce billable weight and delivery costs on your own if you are already fulfilling orders in-house, collaborating with a 3PL can save you money and time.
3PLs maintain a diverse inventory of packaging solutions for you and have the experience to offer the optimal product packaging solution. A competent 3PL helps you choose the right box size and void fill, speeding up, reducing, and streamlining your shipments.
Bottom Line
Technology-enabled 3PLs provide insights into critical distribution parameters that you can employ to make informed decisions, such as the average delivery cost. They collaborate with you to choose the optimal packaging solution for your products. Besides, they consider product integrity, purchase history, the customer experience, and delivery costs when making packaging recommendations. You may connect with shipping aggregators like NimbusPost to save money on shipping.
