How to Calculate the Freight Cost?

The term freight, which is frequently used during maritime transportation, is developing in the field of transportation. It is also known that it is widely used in many places. The term freight, which was used only in maritime transportation in the past, is now one of the important parts of transportation areas such as road, railway and airline. It is referred to as “the service fee paid to the carrier company by the cargo transported by sea”. One of the topics that many people are curious about is the answer to the question of how to calculate freight.

In freight calculation processes, first of all, it should be determined how the type of transportation is. In other words, different calculations can be made in road transportation and maritime transportation. In maritime freight calculation transactions, it is also known that there will be different freight charges according to the mode of transportation. During transportation, the transportation model that is most suitable for the load is used.

In freight price calculations, the gross weight of the existing cargo should be taken. Gross weight is compared with volumetric weight. In order to find the volumetric weight, the total volume of the pallets must be calculated. The total volume amount obtained should be multiplied by the volumetric weight constant. That is, the total volume is multiplied by 333 kgs/cbm. The result obtained in this way determines what the volumetric weight of the loading is. Whichever is higher in the result is taken as the weight unit during the freight charge calculation process. After these transactions, the freight price is deducted according to spot prices.

You can quickly calculate the freight by selecting your departure and arrival route from the area just above on the Shipeedy website. 

Who pays the freight?

The term freight, which is familiar to those who work on foreign trade, is used in all international transportation services. An invoice is issued for the freight. It is also predetermined who will pay the tax arising from this invoice. This information is also included in the freight agreement. The invoice price of the freight can be paid in advance or at the port of destination. Ship freight calculation information is also included in the arranged contract. This contract is called bill of lading.

It is also possible to give freight calculation examples for invoice calculation transactions. The goods to be shipped primarily are delivered safely from the customs point to the destination. This is exactly the intended situation. Many expenses and cost items are also calculated for the freight to be delivered safely. It is possible to reach the result much more easily by using the freight calculation formula.

Freight, known as the cost of transporting goods by sea transportation, must be paid by the seller. It can also be named as exporter. In cases where the freight is paid by the buyer, it starts with the purchase of the goods from the seller's business. In other words, when a transportation agency is agreed for the transportation of the goods, the freight is paid by the buyer.

What Does Freight Cover?

There are different variables that you may encounter at points such as partial freight calculation. At this point, the freight cost is calculated with the combination of these variables. In general, it is possible to call it the transportation cost. It is also known that there are some basic factors within the points covered by the freight price. Among these, the supply and demand balance in the market stands out. At the same time, transportation time is among the important topics.

The distance between the origin and destination of the goods to be transported is also among the relevant issues. Necessary calculations are made based on this distance. How often the goods to be transported are transported is also one of the points at the forefront of the freight cost calculation. Whether the party carrying the goods will return loaded or empty from the destination also plays an important role in the calculation of the freight cost. Therefore, it may not always be possible to reach a clear result with online freight calculations.

For example, harvest periods are intense during vegetable and fruit transportation. During this process, demands increase and business alternatives become more. Therefore, the freight cost, that is, the cost of transportation, increases. In general, it is known that some freight routes are more preferred. Again, this is one of the parts that cause the freight price to increase. Therefore, it is important to mention the amount of cargo to be transported when calculating the freight price. If it is known that the person who will carry the load will return by buying goods again, then the freight price decreases. Because if the return is abundant, the return cost is also added to the freight cost.

There are some cost elements that play a role in the formation of freight. These include the ship's depreciation share, i.e. depreciation, maintenance and maintenance costs of the ship, fuel costs, which are included in the voyage costs. There are also some expenses related to port costs. These can be exemplified as port fees. Port and storage costs are also among the prominent factors in the formation of freight. After the ship enters the dock, the costs incurred during the period until the goods are fully loaded are also included in the freight.

When is the freight payment made?

Freight payment, which plays an important role in ship transportation, can be made in two different ways. One of these is advance freight payment. The other is called remittance freight payment. Advance freight payment is made by the carrier to the carrier company within the export date. The remittance freight payment is made after the export starts and the ship sails. During the remittance freight payment, the transportation company has some rights. For example, it is among the rights of the carrier that the goods cannot be delivered to the importer unless the freight is fully paid. Under the bill of lading, it is stated where and by whom the freight will be paid. After the payment is made, if there is no payment information in the bill of lading, the invoice must also be included. The freight invoice must be given to the importer like the loading information.