The Essence of Volumetric Calculations in Logistics

We learn the term “Volume” in middle school as a measurement of the amount of space that a substance or object fills. Volumetric calculations in mathematics lessons are inevitable especially if the topic is 3-dimensional solids. There is a myriad of formulas for calculating the volume of objects depending on their shape. For example, the volume of a rectangular prism is the multiplication of its 3 dimensions: length x width x height. Knowing these formulas is, of no doubt, beneficial for your Math grades in school. However, usage and measurement of volume are much more complicated and essential when it comes to logistics and transportation.

Companies dealing with export logistics give utmost importance to the volumetric calculations as even tiny mismeasurements could generate unwanted situations.

To accurately register the true volume of shipments is important for all companies that receive, store, send, or transport palletized goods in their daily business operations. The importance is obvious from a practical perspective. The limited space of both warehouses and trailers should be planned based on actual, rather than assumed, pallet dimensions. Although not as visually apparent as an overloaded warehouse shelf, there are other significant reasons to ensure that goods are correctly dimensioned.

First of all, when the stated volume is less than the actual volume in the transport sector, the result is often inaccurate billing and underpayment. It is fair to your clients and financially important to your own organization that shipping costs are being calculated using real-life data. You want to pay or be paid for no more or less than the actual volumetric weight that is being shipped. For these reasons, such companies give high importance to volumetric calculations.

Nevertheless, there are some important terms that should be comprehended impeccably in order to fully grasp the importance of volumetric calculations. Both full truckload (FTL) and less-than-truckload (LTL) options have an important place in the freight shipping industry.

LTL refers to less-than-truckload. LTL is when multiple shippers’ freight is on the same trailer rather than having a single company’s freight exclusively on an individual trailer. Several LTL shipments are combined into one truck to fill it as near to capacity as possible. This is a great option for shipments that are between one and six pallets or any shipment that is less than 14 linear feet because it makes the most out of the available shipping space on a given truck. This is a benefit for the shipping needs of small businesses. FTL refers to full truckload freight. FTL shipping is commonly used for large shipments that require taking up the entire truck, or at least close to it. With FTL, your freight is the only freight moving on an individual truck so you have exclusivity to the entire truck and theoretically are filling the truckload. You can reserve the truck with its full capacity even if you don’t require filling up the entire available space. Doing so would ensure that you won’t have to worry about your goods changing hands at any time or your goods being stuck with other products.

The biggest difference between LTL and FTL is that LTL gives you higher cost savings when you ship only a few pallets at a time. This is cheaper for you because you are only paying for the space you are using, rather than paying for a full truck that isn’t filled to capacity. LTL carriers have to maintain efficiency by filling the excess space with other shipments, so they get as close as possible to maximizing the available space on their trucks.

There are specific times when you should use LTL or FTL. There are no hard and fast rules by which you must abide by, however, there are certain situations where full truckload freight might be more appropriate than LTL.

If you are shipping more than six pallets at a time, then the full truckload option is going to be best for you. If your product is fragile and you need to avoid excessive loading and unloading by multiple carriers, the full truckload option is going to be best for you because you know that your fragile products are the only items within that truck.

If you need firm delivery and pick-up dates the full truckload option is going to be better because you can reserve a single carrier to transport your items. For time-sensitive delivery dates, you absolutely want the full truckload option.

If you have a smaller shipment that is anything less than six pallets you will experience higher cost savings using the LTL method. If you have some flexibility on the delivery or shipping date the LTL option is going to be much better suited for you as well. By giving you a pickup and delivery range at either end, as opposed to requiring a more specific time schedule, you can benefit from the savings of combining your shipment with another shipment.

It is important to be aware of how likely your products could incur damage during shipment. You want to make sure that they are sturdy enough for regular handling at various points throughout the shipping process or that they’ve been properly packaged so that being handled regularly is unlikely to cause any damage.

Another important term that should be grasped correctly is volumetric weight. Making the right volumetric weight measurement would allow you to decide whether you should use LTL or FTL. Volumetric weight refers to the overall size of a parcel and is measured in volumetric kilograms. Volumetric weight can be calculated by multiplying the length, width, and height of a parcel (in cm) and dividing that figure by 5000 (some carriers use a divisor of 4000).

You may often find that the price of your shipment is dictated by the volumetric weight of your parcel(s) rather than the physical weight. This is because our pricing is calculated based on whichever is the greater out of the volumetric weight and the physical weight.

For example, you could have a box of feathers that is quite large, say 100 cm X 50 cm X 50 cm but is relatively lightweight at 5kgs. Using the above calculation (length X width X height / 5000), the volume of this parcel is 50 volumetric kilograms. As the volume 'outweighs' the physical weight of 5kgs, the price is based on 50 kilograms. For this reason, it is extremely important to measure parcel(s) their widest, longest, and highest points. Any bulges, handles, tags, or packaging that could break the beam of a measuring laser must be included.

It's worth noting that it works the other way around too. You could have a small box of heavy metal components (30 cm x 30 cm x 20cm) weighing 10kg in physical weight. The volume of this parcel is 5.4kgs. So in this instance, the volumetric weight is lower than the physical weight meaning that the price would be calculated on 10kg.

With developing technologies, companies utilize advanced techniques and systems to hasten and ease the processes while the accuracy and speed of these automated systems allow effective cost savings. However, that is the topic of another Matters of Science article.

-Güney Baver Gürbüz

References: 

“Logistics Automation - the Importance of Volume Measurement.” CIND, 11 Jan. 2021, https://www.cind.se/single-post/logistics-automation-the-importance-of-volume-measurement. 
Reid, Hadleigh. “What Is the Difference between FTL and LTL Freight Shipping?” DCL Logistics, DCL Logistics, 6 Nov. 2021, https://dclcorp.com/blog/shipping/difference-ftl-ltl-freight-shipping/. 

“The Ultimate Guide to Understanding Volume Freight Cost Benefits.” Shipware, 6 Aug. 2020, https://shipware.com/blog/the-ultimate-guide-to-understanding-volume-freight-cost-benefits/. 

“Volumetric Weight.” Base Logistics, 22 Oct. 2020, 
https://baselogistics.com/en/insights/volumegewicht/. 

“What Is Volumetric Weight?” ParcelBroker, https://parcelbroker.co.uk/help/what-is-volumetric-weight-volume-calculator/.