In simple terms, DIM weight pricing is a way of calculating the fee associated with shipping a parcel based on that parcel’s size. The purpose of dimensional weight pricing is to take into account the cubic volume of the package in relation to the parcel’s actual weight. Businesses freight charges are no longer just calculated by how much their packages weigh, the new algorithm also calculates freight charges by how much space the package takes up on the truck or plane.
Carrier space is prime real estate and is priced as such.
With online shopping growing by leaps and bounds each year, carriers put tremendous value on the amount of space available in a truck, trailer or delivery van. Carriers want to discourage shippers from sending out oversized containers that are mainly packing materials, so shippers need to begin packing their products more efficiently so carriers are able to load more packages into the available space on each vehicle of transport. Packages that fail to meet these guidelines will cost more to ship.
DIM pricing, how is it calculated?
Dimensional weight pricing is calculated by dividing the volume of your package by the DIM factor, which is a mathematical constant that is considered as the base weight of one cubic foot of space and is correlated with a specific number given by each carrier.
THE DIMENSION WEIGHT CALCULATION = (Length x Height x Width)/DIM Factor
Using this calculation, freight carriers like FedEx, USPS or UPS calculate shipping charges based on whichever of the following numbers is greater: 1) the actual weight of the package or 2) its calculated dimensional weight. Whichever number is higher becomes your billable weight.
For example, if you are shipping a plush toy such as a stuffed teddy bear in a 12”x12”x12” box, the actual weight of the stuffed teddy bear, box and filler might add up to a total weight of 5 pounds. However, when you multiply the package dimensions and divide by the UPS or FedEx DIM factor of 166, the package’s dimensional weight comes out to 10 pounds which, because it’s the higher number, is how you’ll be billed.
Actual Weight = 5 pounds < 10 pounds DIM Weight
Check your carriers’ DIM factors, or call Fulco Fulfillment.
The current DIM divisor of DHL is 139, while UPS and FedEx are both 166. For international shipping, the DIM factor of both UPS and FedEx is 139. So imagine you were shipping that same plush teddy bear overseas using UPS or FedEx. Your DIM factor would be lower but your billable weight would be higher.
Actual Weight = 5 pounds < 12 pounds DIM weight
Essentially, the higher the DIM factor, the lower the dimensional weight and vice versa.
How Fulco Fulfillment Inc. can help you beat DIM pricing.
At Fulco Fulfillment Inc. we always believe there is a better way. We have over 35 years of experience helping our fulfillment customers save money on their shipping and freight costs. When it comes to DIM pricing, the results are no different: We will save you money. Here’s how:
- Right-sized packaging to reduce DIM weight charges: Wasted space is wasted money. We pack as tightly as possible without allowing empty space that can drive up DIM weight charges. We use packing material that protects but won’t expand or leave a bulge, which if improperly calculated will increase your carrier costs. Our goal is to make sure the dimensional weight is less than the actual weight of the package.
- Cut down on shipping high-volume, low-weight goods: This kind of packaging can take a real bite out of your margins, because the dimensional weights of high-volume, low-weight goods are much more than their actual weights. Fulco Fulfillment Inc. can suggest your best options to circumvent DIM pricing.
- Pass the cost on to your customers: You never want to increase costs for your customers, but sometimes it’s the only way that makes sense for your business. A clear explanation of the DIM pricing mechanism to your customers can help alleviate any hard feelings. Most customers who are loyal to your products will not fuss over a small increase in shipping costs.
DIM weight pricing expertise and all of your fulfillment and distribution needs under one roof.
To stay competitive in your industry you need to watch every dollar and how it’s spent. When it comes to saving money in carrier costs, Fulco Fulfillment Inc. can help you weigh the opportunities and drive lower costs because every aspect of your fulfillment and distribution can be handled from under one roof.
To learn more give us a call at 973-361-1700 or use the contact form here and we’ll be in touch.