How are freight shipping rates determined?

Freight shipping rates are the rates that individuals or businesses are charged for having goods transported from one location to another. There are many factors involved in determining the shipping rates of goods. If you are not aware of these factors, read about how shipping rates are determined below:

Mode of transport

One of the most obvious factors of freight shipping rates would be the mode of transport used to move the products. Shipping products by air or marine transportation is usually quite costly due to many factors, while road and rail transport are generally the least expensive – depending on the distance of the delivery.


As we mentioned above, distance does have an impact on the freight shipping rate. The freight shipping rate for transporting goods overseas are much higher than that of transporting goods locally. Intercontinental transport also has higher freight rates than local transport; however, there are still other factors that could influence freight rates.


The weight of the products being delivered also play a role in fluctuating freight rates. The weight of the package will allow the package to be sorted into a specific weight tier. This tier will determine the minimum weight charge of the shipment, adding on to its freight shipping rates.


Another factor that is used to determine the freight shipping rates of a product is its classification. The classification of a shipment also has many factors, including density, handling, liability and more. Its density is the most influential factor, and this is determined by dividing the weight of the cargo by its volume. Handling usually only affects freight rates when the shipment is considered fragile, and liability involves the value of the product.

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