Freight & Shipping Charges: What is dimensional weight pricing and how is it calculated?

Freight & Shipping Charges: What is dimensional weight pricing and how is it calculated?

Air cargo FedEx plane

What is Dimensional Weight?

Dimensional weight, often abbreviated DIM (or called “volumetric weight, “cubed weight,” or even “Shape Based Postage Pricing”) is used by logistics providers to charge for the shipping carton’s dimensions as well as the weight. DIM weight is determined by multiplying a package’s length, width, and height and applying a volumetric divisor.

The Backstory of DIM

Shipping costs used to be calculated by actual weight, but this caused carriers to lose money on light packages that took up a lot of room space but didn’t weigh much. Dimensional weight is commonly used for invoicing by air freight forwarders, truck carriers, as well as all commercial airlines worldwide. In 2007, DHL, FedEx, United Parcel Service and USPS all adopted the dimensional weight system for ground services.

How Does DIM Work?

DIM is calculated using a theoretical weight of a package, which is a minimum density chosen by each carrier. The density can vary based on whether it’s a domestic or international shipment, or by the region the package is going to.

DIM weight rating calculates shipping costs by multiplying the length, width, and height of a package, and then divides that result by the “dim weight divisor” or “dim factor.” Once calculated, DIM is then compared with the actual weight and whichever is greater is used to calculate the shipment cost.

Is DIM Good or Bad?

Depending on what you ship, DIM could get expensive because dimensional weight favors shippers of dense objects and penalizes those who ship lightweight boxes.

The use of DIM, however, has encouraged most shippers to improve packaging efficiency by using more compact and eco-friendly packaging, which reduces shipment volume and lowers shipping costs. You can avoid high DIM fees by:

  • Using minimal packing materials – just enough to keep products safe
  • Compressing products whenever appropriate
  • Using the smallest box possible

Many warehouse operations now use Cartonization Optimization Technology to reduce shipping costs. This technology uses computer power to access the content and dimensions of an order to find the most efficient size carton to use for that order.

In summary, the shift to freight charges based on dimensional weight has resulted in a more equitable system which in turn has resulted in greater warehouse efficiencies and better environmental practices. The reduced volume of the freight being carried lowers costs further at each stage of the logistics chain. The end result should be a lower price for the consumer, and increased profitability for the shipper.

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By |2017-09-05T14:45:48+00:00July 24th, 2017|Blog Posts, Logistics, Shipping & Freight|0 Comments

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