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How to Calculate Freight Shipping Rates

Even the most seasoned business owner may find it challenging to estimate shipping costs and freight shipping rates. Thankfully, it is not necessary. In order to efficiently and precisely determine freight shipping rates and freight costs, CHP Logistics has provided a few straightforward instructions and advice. Read on to discover more. And don’t hesitate to reach out to us today for our free freight calculator.

How Do You Calculate Shipping Rates for Freight?


Although it may seem difficult, figuring out your freight shipping costs is usually simple. Here are some quick and easy steps you can use to figure out your freight rates and shipping costs.

Start with Tariff for the Class and Weight of the Shipment

We must first acknowledge that all LTL shipments are based on tariffs in order to comprehend how to calculate freight rates. These tariffs, which are also referred to as base freight rates, must be made available by carriers at least once a year. Tariffs ought to be displayed as a cost matrix that breaks down the hundredweight (CWT) rates for each freight class and weight for each set of zip codes.  

You Will Need Origin and Destination Zip Code for Freight Shipping Cost

You will need the destination, origin zip code, freight classification, and weight of each product when rating an LTL shipment or attempting to calculate the cost of freight. 

Shippers Should Know the Freight Class and Weight

The National Motor Freight Classification, a standard that compares goods moving domestically, internationally, and both, publishes a classification of freight. Every commodity has an item number provided by the NMFC. This number is given out when you apply to classes, along with the relevant laws and guidelines. There are 18 different classes altogether, ranging from Class 50 to Class 500. Various criteria form the basis of the class:

  • Liability
  • Handling
  • Stowability
  • Density 

It will typically cost less to ship cargo with a lower class. Lower classes are used to describe cargo that is very dense and/or low-risk. Higher classes, on the other hand, denote freight that is both lighter and larger in size. The cost of shipping increases with the higher the freight class.

The Formula for Calculating Freight Shipping Rates

To calculate your freight shipping rates, you will need to know the following information:

  • Origin zip code
  • Zip code for delivery
  • Class 
  • Weight
  • Tariff rate for the class and weight

Once you have this data, use the straightforward formula below to determine your LTL freight shipping rates: 

Freight Class x Tariff Rate for Class and Weight

The formula for the previous freight shipping rate is a very straightforward illustration. There are a lot more variables that could affect how much you pay for line-haul. The following typical variables frequently have an impact on line haul freight shipping rates:

  • Deficit weight rating
  • Freight of all kinds
  • Lane specific strategies
  • And more.

To ensure you have the most reliable information, we encourage you to reach out to the team at CHP Logistics for a free freight quote. 

– LTL Freight Tariff Variables You Should Consider

When you are looking to calculate your LTL freight cost, it’s imperative to know that rates for the same lane can vary from tariff to tariff. For instance, the shipping tariff produced by a regional carrier may offer superior rates on shorter hauls than on longer hauls. On the other hand, a carrier with a broad national footprint could offer better tariffs on longer hauls than they do on shorter hauls.

– Freight Discounts

When determining your freight shipping rate, keep in mind that the carrier might give you a discount. These discounts are frequently negotiable and may depend on a number of elements, including:

  • The volume of the freight
  • The relationship you have with the carrier
  • And more

Additionally, minimums might be negotiated. The minimum fee assessed by a carrier is the one that is imposed on each shipment. When attempting to calculate the cost of freight shipping, it is crucial to take any applicable discounts into account.

Common Challenges Associated with Calculating Freight Costs

In general, there are a few reasons why figuring out the freight cost for LTL shipments has a bad reputation. 

  • The vast number of factors. When calculating LTL freight shipping cost, the number of factors associated with the move can make it more challenging. For example, you must always consider pallet count, cargo weight, and freight classification.
  • In some cases, benchmarking is difficult. Because it can be challenging to make direct comparisons with the operations of other shippers, benchmarking LTL shipping can be challenging.
  • an ignorance of the factors that influence costs. Many shippers are unaware of the variables influencing LTL freight rates. Shippers should be aware of alternating patterns of supply and demand when attempting to estimate freight rates because freight networks are constantly changing.

Accurate Data Is Key to Freight Quotes and Calculating Freight Shipping Costs

It is critical to record your actual class, whether you are requesting a quote or trying to estimate freight costs yourself. The FAK cargo designation, which hides the actual classes, is far too frequently given to shippers on invoices. It is possible that different kinds of goods are being shipped in this case. This could result in a number of errors and complications that would significantly alter the cost. If everything in the shipment is categorized as FAK, the shipper has no real way of knowing the class of the cargo. In the end, accurate data is paramount. 

Additionally, you can streamline all LTL pricing activities and reduce erroneous assumptions when you accurately capture the data elements, especially those necessary to tariff calculations. 

Contact CHP Logistics for Easy & Competitive Freight Shipping Rates

Your shipments must be shipped at the best LTL rates possible. We are a top carrier in the New York, Long Island, and New Jersey regions at CHP Logistics. We provide quick, incredibly affordable LTL overnight shipping services over a wide service area.

Additionally, we provide a variety of affordable coast-to-coast logistics and shipping solutions if your shipments go beyond our vast footprint to guarantee they arrive on time. 

In the end, calculating freight shipping rates can be confusing because of the sheer number of factors you must accurately consider. However, at CHP Logistics, we make it easy by offering a free quote. 

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