Reuters Events | Supply Chain & Logistics Business Intelligence

Dimensional Weight might be the freight "it" term of 2015. Dimensional weight or DIM weight is the method of measuring package volume instead of just weight alone. This method could become the new standard.

Presently, DIM weight only comes into effect for ground shipping packages that have a volume greater than 3 cubic feet.  This practice is in place so carriers do not lose profit on packages that are bulky but lightweight.  In the past, only international, air and ground shipping packages with a volume greater than 3 cubic feet were charged with the greater of either the dimensional weight or actual weight.  For the time being, the United States Postal Service (USPS) will not be using dimensional weight and will carry on with standard practice. 

Why are FedEx & UPS changing their methods to account for dimensional weight?

In countless cases, carriers must deliver boxes that are much too large for the shipment of a given product.  Manufacturers and other customers are not worried about the size of the box they are shipping when only charged for the weight.  When this occurs on a widespread scale, carriers are filling their vehicles with boxes full of empty space, meaning the vehicles are at their volume capacity without fulfulling the weight capacity. These low density packages become unprofitable to the carrier. Switching to the DIM weight method will cut costs in fuel expenses and other capital expenses in the carriers perspective.

How is dimensional weight calculated? 

To calculate dimesional weight, the Length x Width x Height of the package is divided by a dimensional factor.  Unless you have an agreement made with a 3PL party for a special dimensional factor, FedEx and UPS both use 166 as a domestic dimensional factor and 139 for international shipments. It is important to remember that fractions of an inch are either rounded up or down to the nearest whole number.  Carriers will bill the higher cost of the actual weight and dimensional weight. 

What is the next step for your business?

If the new dimensional weight practices along with the 2015 GRIs will have a significant impact on your business, try to work out a dimensional weight waiver or better terms with your carrier.  This may be not be practical if you are a small business.  

A third-party logistics provider can benefit significantly.  We know exactly what costs are associated with each carrier on a daily basis.  Get a free freight quote from G-Force Shipping to see how we can bring down your freight costs.