The size of a package is important to consider because carriers only have so much room in their trucks to make their shipments. That means that a lighter package in a large box still takes up as much room in the truck as a large, heavy package.
The cost to ship a parcel depends on whichever is greater between the DIM weight and the actual weight of the package. If you have a five-pound item that you're shipping and that item has a dimensional weight of eight pounds, you'll be paying to ship an eight-pound parcel. However, if the parcel has a dimensional weight of eight pounds and an actual weight of 10 pounds, the shipping charge would be for a 10-pound parcel.
Each carrier has their own DIM factor, which is the number by which you multiply the package dimensions to find the DIM weight. While this number varies, DIM pricing applies to any box with a cubic area equivalent to or larger than 1,728 inches. This is the number of inches in a cubic foot.
To figure out whether your package falls into this category, multiply height x width x depth. If your total equals or exceeds 1,728 inches, your shipment is subject to DIM weight pricing charges that are always greater than the actual weight or DIM weight. DIM weight pricing doesn't apply to USPS flat rate shipments.
Who Needs to Worry about DIM Weight Pricing?
Everyone needs to be aware of DIM weight pricing. If your packages are smaller than one cubic foot or you ship heavy objects, your shipping costs probably won't change. But if you regularly send lightweight objects in large boxes, DIM weight pricing could be a factor in your shipping costs.
Some examples of products that are likely to be affected by DIM weight pricing are things that are more bulky than heavy. This could include products like a lightweight bike helmet. Fragile products, such as glass items or delicate sculptures, can also get hit with DIM charges because these items may need extra packaging to keep them safe during USPS shipping.
While paying for extra shipping a few times here or there may not seem like a big deal in the moment, these shipping costs can build up over time. Depending on how often you send lightweight packages in large boxes, you could be taking unnecessary amounts of money out of your shipping budget every year.
For smaller businesses, those additional shipping costs can have a severe impact on the overall success of your company. It's important to know how to calculate your DIM weight charges for shipping.
It may also be in your best interest to consult with a benchmarking company that may be able to help you determine whether you're paying too much out of pocket for your parcels. If you are, they can help you with freight pricing support. Just by identifying and rectifying these shipping issues, you could save your business some serious money.
How to Calculate DIM Weight Charges for Shipping
Remember if your package's height, width, and density total at least 1,728, then you'll need to calculate the DIM weight charge for shipping. To calculate USPS shipping DIM weight charges, the formula is: HxWxD/166 = DIM weight.
The 166 in this example reflects UPS's DIM factor. The DIM factor, as previously mentioned, can change depending on the carrier you're using.
For example, let's say you need to ship a box of holiday ornaments that weigh two pounds. Your box is 24" x 12" x 6". Start by multiplying 24x12x6. The total is 1,728.
From there, you would divide the total by the carrier's DIM factor. In this case, the DIM factor is 166. The total 1,728/166 is 10.4.
The shipping DIM weight of your package is higher than the actual rate. You pay for the DIM weight, rounded up to the nearest pound. Your shipping cost would reflect the 11 pound DIM weight rather than the two pound actual weight.
UPS uses two DIM factors: 139 for daily rates and 166 for retail rates. Daily shippers are high volume UPS users. These shippers usually have a daily scheduled pickup. Retail shippers are everyone else. If you ship an occasional package by UPS, you will pay retail rates.
UPS has heavier DIM weights for its daily shippers than its retail shippers. However, UPS's daily rates are lower than its retail rates, so a daily shipper might still pay a lower rate.
This illustrates another factor to consider when you calculate DIM weight shipping. Consider the rate that each carrier will charge you to deliver your package. The largest DIM weight may not always translate to the highest shipping cost. This is particularly true if one carrier starts out with a lower rate.
DIM Weight and the Major Carriers
All of the major carriers including UPS, FedEx, and USPS use DIM weight pricing. However, the carriers have different DIM factors and that can affect what you pay when you're shipping oversized packages.
Let's look at the example from above, the box of ornaments that weighed two pounds. Using the DIM factor of 166 for USPS shipping, you had to pay for 11 pounds. FedEx has a DIM factor of 139. The lower the DIM factor, the higher your costs.
The formula to ship the ornaments by FedEx looks like this: (24x12x6)/139=12.4. Thus, you would pay for 13 pounds if you shipped that package via FedEx.
How AFMS Can Assist You With SIM Pricing
AFMS can assist your company in freight pricing support to ensure you have best-in-class rates. AFMS is the leading transportation price benchmarking firm in North America and Europe.
Our business intelligence analytics focus on reducing transportation costs through carrier contract negotiations and automated freight audit and recovery. AFMS specializes in benchmarking your freight rates to tell you exactly what market discounts and concessions you deserve with your current carrier.
The freight pricing support experience of the AFMS senior management team is unparalleled. We have an average of more than 25 years of senior pricing and sales experience for various transportation carriers like UPS, FedEx, and DHL. It's on this freight pricing support experience that our 28 years of business success has been built.
Our inside pricing knowledge is why the largest shippers in the US and Europe use AFMS’s benchmarking and pricing expertise. Companies like GE, Sony, Disney, Under Armour, StockX, Dell, Honda, Toyota, DSW, Trek, Johnson & Johnson, Bose, and over 3,000 other large shippers have all negotiated best-in-class shipping rates with AFMS’s help.
Our fact-based negotiation strategies, advice, and management solutions are key strengths to why AFMS clients have the best shipping rates among various peer companies. Our senior managers are actively involved in every aspect of our clients' carrier contract negotiation strategies and discussions.
For your NO Cost evaluation of your DIM factor along with 40 other keys pricing components, please contact us at 1-800-246-3521 or firstname.lastname@example.org.