Posted in Operations and Supply Chain Terms, Total Reads: 297
Definition: Minimum Weight
It refers to the shipping weight specified by the carrier that’s used to determine what freight rate should be levied and what discount rate can be offered. Some Carriers also require shippers to meet a minimum weight in order to avail the service e.g. Carload rail service and hence, if the minimum weight is not met, carrier don’t provide service. In class rate structure, different classes are created in alphabetical order and minimum weight for each class is specified as eligibility criteria for discount for respective classes.
Measurement of minimum weight: Dimensional or volumetric pricing is used by carriers in order to determine the minimum weight for a package to be shipped. In this pricing scheme, measurements of the box are taken and then, multiplied by a predetermined density factor (i.e. weight per volume) in order to determine the minimum weight for the package.
Proper knowledge of minimum weight is crucial for cost management in supply chain and can drastically increase the cost if it’s not taken care of. It’s also important to understand the scenario whether discount or extra charges will be levied in order to plan the strategy.
Example, whenever you want to ship a box to another destination through a carrier. It determines the minimum weight based on the dimensional analysis and if the weight of particular box comes out to be more than the minimum weight specified by the carrier, then extra charges are levied.