Auto-rating is a key component of any LTL and FTL carrier or broker.  We have revealed how DTMS rates your orders.

  • Rate Type: Customer, Driver, Interline, Team and/OR Division
  • Formats: City, Zip, Mile, and/OR Zone
  • Cube Foot: This refers to the volume of the shipment, measured in cubic feet. Larger shipments typically cost more to transport due to occupying more space.
  • Location: The starting point or origin of the shipment. Distance from the shipping point to the destination can affect shipping costs due to factors like fuel consumption and tolls.
  • Destination: The endpoint of the shipment. Shipping to distant or remote locations may incur higher costs due to factors like limited access or infrastructure.
  • Billto: The entity responsible for paying the shipping costs. This could be the sender, receiver, or a third party.
  • Shipper: The party responsible for physically transporting the goods. This could be a shipping company, carrier, or logistics provider.
  • Weight: The mass of the shipment, often measured in pounds or kilograms. Heavier shipments may require more resources to transport and thus incur higher costs.
  • Per Truckload: The cost associated with filling an entire truck with goods for transport. This can vary based on factors like distance, type of goods, and current market rates.
  • Skids: Refers to the number of pallets or skids used to package and transport the goods. More skids may require larger trucks or additional handling, impacting costs.
  • Linear Foot: The length of the shipment when arranged in a line. This could be relevant for certain types of cargo or when determining space requirements.
  • Deck Space Volume: Refers to the amount of available space on a transport vehicle, typically measured in cubic feet or meters. Utilization of deck space affects efficiency and thus costs.
  • Drop/Trip Rate: The cost associated with each stop or delivery point during a shipment. More stops generally result in higher overall costs.
  • By Mile/Km: The distance traveled for the shipment, which can significantly influence transportation costs, considering factors like fuel consumption, vehicle maintenance, and driver wages.

Each of these factors can be incorporated into DTMS rating algorithm to calculate the total cost of shipping or transportation services. The specific weights and formulas assigned to each factor will depend on the priorities and business model of the shipping company or logistics provider. We have developed a rating algorithm for shipping or transportation services, you’ll need to consider various factors that impact the cost of transportation. Here’s a simplified example of how might structure such algorithm in the trucking software:

  • Input Variables:
    • Cube Foot (Volume of the shipment)
    • Weight (Mass of the shipment)
    • Distance (Miles or kilometers from origin to destination)
    • Skids (Number of pallets or skids)
    • Drop/Trip Rate (Number of stops or deliveries)
    • Special Requirements (e.g., temperature-controlled, hazardous materials)
  • Base Rate Calculation:
    • Start with a base rate that includes fixed costs such as vehicle maintenance, insurance, and administrative expenses.
  • Factor in Distance:
    • Calculate distance-based charges using a rate per mile/km. Multiply the distance by the rate to determine this portion of the cost.
  • Volume and Weight Charges:
    • Calculate charges based on volume (cube foot) and weight. You may have different rates per unit of volume or weight, depending on the type of cargo and transport mode.
  • Skid Charges:
    • Charge based on the number of skids or pallets used for packaging. This could be a flat fee per skid or pallet.
  • Drop/Trip Rate Charges:
    • Add charges for each stop or delivery point along the route.
  • Special Requirements:
    • Apply additional charges for special handling requirements such as temperature-controlled transport or hazardous materials.
  • Total Cost Calculation:
    • Sum up all the charges to calculate the total cost of shipping or transportation services.
  • Discounts or Surcharges:
    • Apply discounts for bulk shipments or long-term contracts, or add surcharges for rush deliveries or peak times.
  • Final Rate Adjustment: Adjust the final rate based on negotiations, market conditions, or competitive factors.
  • Output: Provide the customer with a quote or estimate based on the calculated rate.

It’s important to regularly review and adjust the algorithm based on factors like fuel prices, labor costs, regulatory changes, and customer feedback to ensure competitiveness and profitability. Additionally, the complexity of the algorithm may vary depending on the specific needs and requirements of your transportation business.

Please get in touch to see how our customers save many hours from our Auto-rating Request a call/demo