How To Calculate Freight Rates - For Beginner Freight Forwarders

[@jimmygeorge1747]

I recently joined in a freight forwarding company. Your videos are so informative and helpful for me. Thank you so much for your great efforts.

[@ABTS]

So glad to hear this and gives me more inspiration to create more videos. Thanks for your comment indeed.

[@959430315]

Which company

[@AbigailAidela]

When I was little I visited my dad’s office a couple times, he worked as HR manager in logistics firms, my favorite was Panalpina before it closed up in Nigeria, I grew up having so much love and passion for Logistics because of how much my dad talks about it like it is the most important job in the world 😅 he had so much love for it though he is retired now. I love to watch your videos cause I see the same love and passion my dad had and I’m getting so much knowledge from you. I’m sure my dad will love you so much as well. Thank you Mr Alan, I couldn’t have found better mentorship🙏

[@ABTS]

What a lovely story, I’m sure as a child visiting your dads office was very exciting and brings back lots of memories. I’m so happy to hear our videos are helping and all the best to you in your ventures.

[@sarmindojoseraul892]

A video very and very relevant. Thank you.

[@ABTS]

You’re very welcome, I’m glad you found it useful.

[@NguyenKhanhDuya867]

This video is very easy to understand. You just help me out alot.Thanks very much By the way im right now really getting confused about the types of air rates such as minimum charges, general cargo rates, etc... Could you make a video about that ? Still thanks you very much

[@ABTS]

Glad it helped! I'll try and make a video on your suggestion.

[@mohandouamarsihadjmohand4332]

hello ABTS thank u so much for your videos , very instructive and clear, also well focused 👍👍👍👍👍👍

[@ABTS]

Glad you like them! Thank you for your kind comment.

[@spacefalcone]

how can you not like this guy

[@ABTS]

Very flattered. Thank you very much.

[@pramodbharti6349]

Excellent video.

[@ABTS]

Thank you very much for your kind comment.

[@yekojustine4226]

Thank you.

[@ABTS]

You’re very welcome indeed

[@Lobos222]

It should be mentioned though that freight rate is NOT all the costs. You have fuel, security, TACT vs Q-Rate (Air: TACT is "standard rates" used before, but you put them on the Master Airway bill to hide what your actual prices are. The real rate goes on the House AW that is only between you and the customer, Q rate or similar products are basically a discount within given weight rates so up to 45Kg, +45KG, +100 etc. In some case, if you for example are close to 100, but just under. The rates at 100 might be slightly lower than +45. Which in turn means you should ask for rate 100kg in that case), terminal handling fees, documentation, LCL extra fee vs FCL all in and so on. It is the fess that will eat your margins. Like my teacher told me: "Look for ZEROS!" What he meant by that is look for companies, in between freight forwards, ship companies, agents etc which have zero on some fees others tend to charge for (Edit: This means also look for fees that are missing, which also means they do not charge for that, same thing) that makes the total cost for you cheaper in context of A to B.

[@ABTS]

Thanks for your comment, sure, the video was just to explain the basic freight rate calculations in a simple manner for new freight forwarders to understand it.

[@victorllorens7221]

Thank you so much for the explanation. Will the freight forwarder always choose the more expensive of the two? Or is that negotiable? And can you explain what you mean by “volume out”. Thanks again!

[@ABTS]

Hi Victor, as far as sea freight, the shipping line will charge you either a container load at a lump sum or less than a container load by "weight measure" (i.e. per 1000KG or per cubic metre which ever is the greater). Air freight will charge you by "volume metric" (i.e. 6000 cubic centimetres = 1KG). Neither are negotiable. "Volume out" means the price paid is not on actual weight but the weight as per the formulas discussed in the video. I know it can be complicated by hope this helps.

[@kravetsky]

Thank you, Alan! :)

[@ABTS]

You’re very welcome Edward.

[@RossGregorymachines88]

Great video

[@ABTS]

Thank you! I’m glad you enjoyed.

[@chandulokeshdavuluri8274]

Thanks team....

[@ABTS]

Very welcome

[@Geva555]

Thank you

[@ABTS]

You’re welcome Giva

[@davidthompson4383]

Do you have any recommedations now that Lloyd's Loading List has shut down?

[@ABTS]

Hi David, I did come across the "HandyShippingGuide.com" which looks ok as a substitute: handyshippingguide.com/. Let me know how it might work for you.

[@sujirao9855]

​@@ABTSthis handy guide doesnt open in india??

[@ABTS]

@@sujirao9855 I'm not sure why that would be, have you tried to reload?

[@sujirao9855]

Hows that Some freight forwarxers say zero freight charge?? Then how r they managinh.. i am confused . Kindly explain sir

[@ABTS]

Freight forwarders must charge a fee, they don't ship goods for nothing or of course they will go our of business.

[@sujirao9855]

@@ABTS yes. I understand but i have heard people use this sentence.. is it possible for them to charge from the other side of clients??

[@ABTS]

@@sujirao9855 Not really, a freight forwarder will charge their clients to move goods from point A to point B. There's no other side to speak of.

[@joey_0323]

Hello Mr. Alan I have a question regarding your video or if anyone can explain to me how did he get 402.37 kg. what calculator did you use to get that or how did he convert the centimeters to kg for his answer. Thank you.

[@ABTS]

Hi Joey, this is indeed confusing but let me try and explain. The dimensions of the cargo in this example are: 207 x 109 x 107. These dimensions are multiplied together: 207 x 109 x 107 = 2,414,241. The next part of the calculation is to take the total and divide it by 6000: 2,414,241 / 6000 = 402.3735. The reason we divide it by 6000 is because 6000 cubic centimeters is the equivalent of 1 kilo in weight. I hope this helps?

[@rabarazad6624]

Hello Mr. Alan, Thank you so much for the useful information you are giving us, May I ask, if a seller asks the buyer to pay the entire contracted amount in T/T payment against signed FCO, sales contract and Proforma invoice by the bank, is that a reliable method of payment in international trade? Can the buyer be refunded in case of non-delivery or non-acceptable quality of the product? (Seller is a known company with a prominent website and address). I highly appreciate your reply. Thank you.

[@ABTS]

Hello, thanks for your question. I'm not sure what you mean by FCO? In general a TT payment is not a guarantee that you will receive the correct quality or quantity, even if the supplier is legitimate. The safest way on a TT would be payment against commercial invoice and clean report of findings before the consignment is shipped.

[@rabarazad6624]

@@ABTS thank you for your reply. I appreciate!

[@julioquirino2131]

Dear Sir, would you be able to help me to understand something? I am planning to start a food import business. So I will need a reefer container. Is it better to buy my own container? How much would save me in the long run to buy a container?

[@ABTS]

It’s a difficult questions to answer. If you ship your own plated reefer, you usually get a discount off the freight rate. You will have to calculate the discount versus the cost of a plated reefer over time/shipments. Unless you’ll also use the reefer as plugged-in storage in which case there’s also this added upside.

[@RuachDakKoy-up1bi]

There is wisdom in gray hair 😅😅😅

[@ABTS]

Thank you very much 😁. My grey hair is the price of wisdom it seems.

[@syedfaisalshah6675]

Please carryon telling us the truth. We want to hear you!

[@ABTS]

I’ll certainly do my best! Thanks very much for your comment.