Shipping Cost Calculation Formula | International Shipping Rate

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Shipping Cost Calculation Formula and International Shipping Rate

What is Freight?

Freight can be defined as the goods or products that are being transported, usually for commercial gain by using ship. However, the term ‘shipping’ is being used to define commercial transportation of goods by following different shipping methods such as by air, by sea, land via container trucks and other modes of transport. To know more about shipping or shipment you can follow What is shipment or shipping and international shipping process flow chart.
Shipping cost calculation formula
Fig: Shipping cost calculation formula
What is Shipping?

Shipping is a general term which originally used to refer to transport of products or goods by using the sea port. However, shipping can be of different natures. Whether it is by air or ship, the transporting of products or goods in bulk from one place to another can still be termed as shipping. There are mostly used 13 International shipping terms and conditions in export import business.

Shipping and Forwarding Cost Calculation Formula:

To calculate the shipping cost the below formula has to follow:

Shipping and forwarding cost per apparel,
          All expenses
= …………………………….

       Shipping quantity

Elements of Shipping and Forwarding Cost:

The cost elements included in the shipping and forwarding cost are as follows:

  1. Freight charge for freight forwarders,
  2. Documentation charge,
  3. Transportation,
  4. Port charges,
  5. Customs expenses,
  6. Insurance charges (If needed),
  7. Agent commission,
  8. Bank expenses,
  9. Regulatory expenses.

Factors of Shipping and Forwarding Cost:

There are some key factors which influence on the shipping and forwarding cost in apparel industry are listed in the following:

  1. Mode of shipment- By air, sea, road or combination.
  2. INCO terms- FOB, CFR, CIF etc.
  3. Volume or amount of the apparel export order.
  4. Types of assortment.
  5. Country of destination.
  6. Forwarding and clearing agent.
  7. Government rules and regulations.
International Shipping Cost or Freight Charge:
SL No.
Destination
20’
40’
40’ Hi-Cube
B/L
01
Netherland
$1450
$2700
$2800
Rs. 1000
02
Belgium
$1450
$2700
$2800
Rs. 1000
03
Germany
$1450
$2700
$2800
Rs. 1000
04
UK
$1400
$2800
$2900
Rs. 1000
05
USA
$1400
$2400
$2500
Rs. 1000
06
UAE (Dubai)
$800
$1600
$1600
Rs. 1000
07
Srilanka
$400
$900
$1000
Rs. 1000
08
France
$1500
$3000
$3100
Rs. 1000
Different Charges in Shipping and Forwarding:
SL No.
Details of Expense
20’
40’
40’ Hi-Cube
LCL
01
Transportation charges
10350
15400
15400
02
Stuffing charges
1150
2450
2700
03
In and out expenses
400
400
400
04
Lift-on or Lift-off
545
831
831
05
Wattage charge
562
843
843
06
Documentation charges
250
250
250
250
07
Extra documentation charges
500
500
500
500
08
Agency charges
2000
3000
3000
12
09
Survey or report charges
200
200
200
10
Communication expense
150
150
150
11
Terminal handling charge (TCL)
2900
3900
3900
250/m3
12
Bunker adjustment factor
$315
$630
$630
13
Ocean freight
–
–
–
$40/m3
14
Service charge
1000
1500
1750
500
15
Service tax
12.36%

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