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How to calculate the cost of cargo transportation

How to calculate the cost of cargo transportation

18 October 2022 16:46

Cargo transportation is a separate type in the economy of both Ukraine and absolutely any other country. Freight transportation is carried out by many modes of transport, but road freight transportation is the best way to cope with this. For those who provide and receive such services, the question “how to calculate the cost of transportation” is very important. Today, the role of carriers is performed by both transport companies and individual entrepreneurs. Each of them sets its own tariff.

How to calculate shipping costs and what to look out for

Theoretically, the cost of a freight service should include the following basic parameters:

  • distance, including idle runs
  • car expenses (fuel, depreciation, tire wear);
  • driver salary;
  • office expenses, communications, consumables, etc. (telephone, internet, fax, printer, etc.).

In practice, the type of cargo and vehicle, loading operations, rigging devices, packaging materials, and much more are added here. In order for the carrier to “not go into the red”, the cost of services also includes:

  • taxes;
  • deductions to various funds;
  • travel allowance for the driver;
  • tolls;
  • Overhead costs (parking fees, hotels, etc.).

Specialists offer various formulas to calculate the cost of freight transportation. For a person who understands little about this, it will not be easy to understand such formulas.

How do some companies calculate shipping costs

Although there is a shipping cost calculator, many carriers use one of the following pricing options:

  • “adjustment” to the market (without calculation, the average market price of the service in a given period of time is offered);
  • according to the principle of “solvency” (orientation to the situation and the maximum possible price that the customer is willing to pay);
  • taking into account the desired profit (the cost of the service must guarantee the receipt of the revenue that the carrier wants to have for a certain period of time, including all costs);
  • “The cost of the service + some profit” (everything is fair at first glance, but this option is unlikely to be implemented without taking into account demand, the average price on the market).

Because each carrier calculates the cost of the service differently, it is best to work with companies that offer taxi-like mobile apps. When entering the initial data, the customer will be able to complete the order at the best price for him.

Clients who do not want to calculate the price of freight transportation, but at the same time do not want to overpay, can take the advice of professionals.

It lies in the fact that in the total amount of the calculation of the price of cargo transportation, the fourth part is the cost of fuel. With this amount at your disposal, it is very easy to calculate the cost of transportation. To do this, simply multiply the price of the fuel used by four. Naturally, the cost will be different in 2021 and 2022, as fuel prices change regularly.

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