USA Truckload Shipping Logo

How to Calculate Freight Shipping Costs

Resources > How to Calculate Freight Shipping Costs
Changing freight rates and hidden fees can be a pain. Learn the way to estimate shipping costs so you don’t get surprised by the bill.
Published: March 3, 2022
Last Modified: August 28, 2023
Author: Natalie Kienzle

If thinking about how to calculate freight shipping costs give you a headache, you aren’t alone. Rising shipping expenses, both international and domestic, have many small and large business owners anxious to find ways to save. Saving on shipping expenses is not a one-size-fits-all solution. The type and amount of goods you ship should factor in to find the best solution for your needs.

The National Motor Freight Traffic Association (NMFTA) and the Federal Motor Carrier Safety Administration (FMCSA) both influence the way freight shipping costs are calculated. The NMFTA assigns Freight Class ranks to LTL shipments to standardize pricing. FMCSA regulations set limits on drivers and goods which affect costs.

Find out more about freight shipping calculations to make the best decisions when electing carriers to handle your items. 

How to Calculate Freight Shipping Costs: Freight Rates and Classes

There are two common choices for shipping large freight in the United States. FTL refers to Full Truckload transport. An entire trailer is dedicated to one shipment or good. LTL is Less-Than-Truckload transport where goods from different shipments may share trailer space.

Pricing for FTL and LTL follows different paths. While many make the argument that LTL shipping is less expensive, it’s not the case all the time. Amounts, distances, and materials all affect the quotes you receive from carriers. Before getting a quote, however, it’s a good idea to calculate an estimate so you know what to expect.  

Calculating a basic shipping rate isn’t hard. Having estimates on hand is a good business practice. However, be aware that these will just be estimates. True costs take into account other factors and these need consideration when selecting carriers. 

Learn more about FTL and LTL shipping by reading our article, “FTL vs. LTL Freight Shipping: What’s the Difference?” 

How is freight shipping calculated with an overhead view of a warehouse worker walking between an aisle of boxed items

What Determines FTL Freight Rates?

FTL freight shipments have a reputation for simple but expensive pricing. Initial pricing for FTL shipping rates is based on destination and mileage. Since the goods inside the trailer (or on a flatbed) will belong to just one shipper, they can travel non-stop to their destination.

Of course, nothing stays simple for long. Other factors play a role in determining FTL freight rates, but let’s start with the basics.

Truckload Shipping Calculator: Per-Mile vs Flat Rate

The base calculation that carriers use to determine FTL works on a price-per-mile system. Sometimes called a per-hundred weight charge (CWT), shippers can look up the average price-per-mile and estimate a freight shipping cost base amount. 

Calculate your estimate based on the type of trailer your goods will be transported in. Different trailers vary in terms of cost. There are three common types of freight trailers. 

Semi truck with trailer on highway during sunset
  • Dry Van Freight: Non-temperature controlled closed trailers with a $2.76 per mile average. 
  • Reefer Freight: Refrigerated trailers for perishable goods with a $3.19 per mile average
  • Flat-bed Freight: Open and flat trailers used for goods that can’t be secured within a trailer because of size or weight restrictions. Has a  $3.14 per mile average. 

Reefer freight is going to be the most expensive. Refrigerated trailers must have their temperature monitored and the goods they carry are time-sensitive. The price per mile charged by carriers will also depend on fuel costs, tolls, and standard maintenance needs for trucks. 

When a food processing plant in Wichita, Kansas needs to ship a trailer of beef cuts to Chicago, Illinois, the distance is roughly 710 miles. Assuming an average rate of $3.19 per mile for a reefer trailer, the base price should be about $2,250.00

Per-Mile Estimated Freight Costs 

Distance$ Per MileBase Average (rounded)
710 miles$3.19$2,250.00

A base average calculated on your own is good for a freight shipping estimate. However, it’s only meant to be a starting point for your shipping calculations. Changing diesel fuel costs often affect the final rate. 

Should a carrier provide you with a flat rate, you can still figure out the freight rate per mile. Divide the total rate by the route mileage and you’ll get the per-mile freight rate. 

  • Total rate/mileage = per-mile freight rate

You need to transport goods from Miami, Florida to Nashville, Tennessee – a 915-mile journey. A carrier quotes you a $3,500 flat rate.

Flat Rate Freight Estimates

Flat RateDistanceFreight Rate Per Mile
$3,500.00915 miles$3.83

The carrier is charging you about $3.83 a mile for the trip. If it is a flat rate, it may include fuel calculations. By doing the math when you receive the quote, you can determine how much higher or lower they are than average. 

As with figuring out a base average, this should not be used as an absolute number. It is a tool to provide you with a benchmark when budgeting for shipping needs. Other factors, known as accessorial charges, influence the final total; some you can control and some you can’t.

Accessorial Charges may include:

  • Freight lanes: These are established routes that carriers use to go from one location to another. Two deliveries may have the same mileage, but different pricing. More common lanes, like those connecting major cities, will often be less expensive than lanes that end in rural areas for delivery. 
  • Supply and Demand: Seasonal or special event items may create shortages in trucks or drivers. Since FTL isn’t designed to divide deliveries, you have to wait for an entire trailer to become available along with a driver.
  • Regulated Marchandise: Any goods closely monitored by a government agency or needing special transport specifications may increase the rate you pay. 
  • Expedited Services: Rates for expedited freight lanes will run higher. These direct routes may contain more tolls, consume more fuel, and put a heavier toll on the driver. 
  • Backhaul Availability: Carriers wish to avoid hauling empty trailers whenever possible. Empty trailers aren’t making any money. Should your delivery be to an area where it will be difficult for a driver to pick up another load for the return trip (so there is nothing to offset the cost of the fuel for the return trip), the rate may be higher as a way to make up for it. 

Assigning a specific or consistent number to any of these services for a freight shipping estimate is difficult. These factors change often, and the impact on the cost of freight will not be universal across the industry. 

Overhead view of semi loading=

What Determines LTL Freight Rates?

LTL freight rates are credited with being less expensive than FTL rates. This is mostly due to the fact that the nature of LTL shipments is to have more than one load in a trailer. This allows everyone using that trailer for shipping to share the travel expenses among them. Distance calculations are also less important. 

Instead, LTL freight rates are determined using the dimensions and density of a shipment. The cubic inches of a shipment are calculated using the height, width, and depth measurements of a fully prepped package, often a pallet. When converted to total cubic feet, they determine the space a shipment will take up. Calculate density using total cubic feet and weight. 

Density is the greatest determining factor, so a system was created to standardize costs to ship based on it. The denser a shipment is, the less expensive it will be to ship through LTL services. 

The NMFTA developed LTL Freight Class as a standard unit of measurement based on density. Along with three other metrics, freight class gives shipments a ‘transportability’ rating. There are 18 different levels that go from most to least dense. 

The highest density ranking, class 50, is also the least expensive. It goes to class 500 which is the most expensive and has the lowest density. 

Freight Class and the NMFTA’s National Motor Freight Classification (NMFC) numbers work together in determining final rates.

Check out our article on LTL Freight Classes for an in-depth look at how freight class affects shipping. 

Overhead view of two workers examining a package in a warehouse aisle

LTL Rate Calculator: Estimating Freight Class

An LTL Freight Class designation can be found by measuring a package’s shipping dimensions and weight to find density. The density is the first measure used to determine freight class, but it isn’t the only measure. Like the FTL rate estimates, freight class calculations are only guesstimates. 

Use the following equations to begin your estimate. First, find cubic feet. Once that is calculated, you can find the density by also using the weight. 

  • (height x width x depth) / 1,728 = cubic feet (ft³)
  • weight (lbs) / cubic feet (ft³) = density

Using those equations, we can estimate the freight class of a pallet that measures 4 feet by 4 feet by 3 feet and weighs 100 pounds. 

LTL Rate Calculator Estimate

Height x Width x Depth (inches)Divide by total inches in a cubic footCubic Ft. 
48 x 48 x 3682,944 / 1,72848 ft³
Weight of Shipment (lbs)Cubic Ft. (ft³)Density
100482.083 lbs/ft³

The resulting density – 2.083 lbs/ft³ – would place it in freight class 250. The table below shows the 18 different freight class rankings and their relative density ranges. 

LTL Freight Class Rankings

LTL Freight ClassDensity* 
Class 5050+ lbs
Class 5535 – 50 lbs 
Class 6030 – 35 lbs
Class 6522.5 – 30 lbs
Class 7015 – 22.5 lbs
Class 77.513.5 – 15 lbs
Class 8512 – 13.5 lbs
Class 92.510.5 – 12 lbs
Class 1009 – 10.5 lbs
Class 1108 – 9 lbs
Class 1257 – 8 lbs
Class 1506 – 7 lbs
Class 1755 – 6 lbs
Class 2004 – 5 lbs
Class 2503 – 4 lbs
Class 3002 – 3 lbs
Class 4001 – 2 lbs
Class 500 <1 lb
*(measured in pounds per cubic foot)

An official freight class can only be set by the NMFTA because there are three other metrics considered beyond density. 

  • Ease of handling
  • Liability
  • Stowability

These metrics are used by the Commodity Classification Standards Board (CCSB) which is a division of the NMFTA. After they make a decision, items get a National Motor Freight Classification (NMFC) code. Carriers who are members of the NMFTA have access to the catalog of NMFC numbers maintained for all shipments within the United States.

Private businesses can also access this catalog through the NMFTA’s ClassIT® tool, available for a one-time fee or as part of a subscription service. 

Boxes stacked on a pallet jack

What are NMFC Codes? 

The NMFC number, mentioned earlier, is a five to six-digit code given to specific products shipped around the United States. Use an NMFC code to find an item’s specific LTL Freight Class if it has one.

Shippers and carriers should also be aware that an item’s NMFC code can and does change. As new products are introduced to the market and new ways of packaging are used, NMFC codes are analyzed for accuracy. 

Another part of the NMFTA, the Freight Classification Development Council (FCDC) collects information on different items that seem to need adjustment. The CCSB is the group that analyzes the data to see if new codes are needed or to discontinue old codes. 

What is Cubic Capacity?

The cubic capacity rule is a carrier’s way of making up costs when shipping large dimension, low-density objects. Often added as a surcharge to a freight bill if applicable, it can be the source of hefty fines on top of the standard shipping service.  

Because density places such a large role in determining fees, most carriers have a minimum density requirement in place. This is the Cubic Capacity Rule, sometimes called density deficit. 

Boxes on a pallet being moved by a warehouse forklift and operator

This isn’t a rule set by the NMFTA. Individual carriers may set their own limits. Always double-check with the carrier you plan to use for your shipments. Most carriers will state that any shipment filling more than 750-cubic feet and with a density of less than 6 lbs/ft³ may face a surcharge for density deficit. 

Although lower density items do pay more, once they take up a certain amount of space, the extra becomes a null profit. LTL carriers rely on the ability to take on multiple shipments. If a large, low-density shipment is taking up space that could otherwise go to a better-paying load, the carrier is going to want to make money one way or the other. 

This rule only affects LTL shipments, not FTL. In some cases where the cubic capacity rule cannot be adjusted, shippers may be better off using an FTL service. 

Empty pallet on the floor of the warehouse with full aisles in background

Calculating for Cubic Capacity

Cubic capacity may come as a surprise to shippers who made sure to measure their palletized cargo for estimate purposes. It is possible for an individual pallet to meet the minimum capacity while a group of the same pallets does not. This is because carriers calculate the shipping rate based on the combined density of someone’s entire shipment, not pallet by pallet. 

Imagine you are preparing a pallet of flat-screen televisions for shipping. Because of the product, nothing can be stacked on top. It’s very likely the carrier will measure the height of your shipment at 96 inches, the standard height of a trailer since the space can no longer be used.  

Therefore one pallet will measure 96” x 48” x 48”. It weighs 400 pounds.

  • (96 x 48 x 48) / 1728 =   128 ft³
  • 400 / 128 = 3.125 lbs/ft³

One pallet is safe. It would be smaller than the 750 ft³ minimum. However, suppose you need to stock up on several televisions. You arrange for 6 pallets of televisions, all packaged the same way. 

Cubic Capacity Limits

1 Pallet4 Pallets6 Pallets
128 ft³ @ 3.125 lbs/ft³512 ft³ @ 3.125 lbs/ft³768 ft³ @ 3.125 lbs/ft³

One pallet or four pallets would be fine. Shipping six pallets would trigger the cubic capacity fee and land you with extra fees. Cubic capacity surcharges aren’t the same across U.S. carriers. Depending on supply and demand, a carrier may change its minimums at any time. Staying informed about such changes is necessary to avoid surprises.

Even if you consistently ship with the same company, always check for cubic capacity. Consider the example above. 

Perhaps your business consistently shipped four pallets at a time, and always packaged the same way. No extra charges would ever be added. The one time you fall behind and decide to order the extra two pallets, you get charged for cubic capacity because you didn’t think to check ahead of time.  

If you conduct your shipping through a 3PL warehouse, it’s possible they are familiar with this rule and may warn you ahead of time. A good 3PL will also have packaging procedures designed with LTL freight class in mind. Packing for the highest possible density may help customers pay lower LTL rates. 

Back view of an open and empty tractor trailer

Is FTL or LTL Less Expensive? 

The answer to which is more expensive, FTL or LTL, all depends on one other question. What are you shipping? 

LTL is often the choice for heavy items that can be packed tightly or easily stacked. Items that can be moved easily on and off a trailer do better in LTL shipping, which makes frequent stops and requires packages to be loaded on and off. Non-perishable items or merchandise that is part of a regular delivery also tends to be less expensive when shipped through LTL. Many carriers also offer deferred LTL rates to make payments more affordable.

If you need to ship goods in bulk (15 pallets or more) or your goods have non-standard dimensions, FTL might be the only option as well as the less expensive one. A construction company that fabricates roof trusses likely needs the services of an FTL flatbed because the material won’t fit into a trailer. Bulk orders of industrial HVAC equipment likely need an entire trailer. LTL just wouldn’t make sense. 

All else being equal, there are factors beyond distance, weight, or density that affect freight shipping calculations. 

  • Hazardous Materials: Regulated goods may not be able to ship through an LTL because they cannot share space with other merchandise safely. Other hazardous materials must be shipped specifically in HAZMAT-rated trailers.
  • Location: Beyond distance, certain zip codes may have rules about how late or early deliveries can be made. Fuel can be more expensive in certain areas. Freight lanes may traverse dangerous roads. Congestion in cities may create delays.  
  • Highway Regulations: The Federal Motor Carrier Safety Administration (FMCSA) regulates safety measures for drivers and cargo. Carriers must comply with drivers’ working hour limits, trailer weight limits, and more. 
  • Accessorial Charges: This is considered anything that may go beyond dock-to-dock delivery. It can include charges for lift gates, residential delivery, white-glove service, or more. It’s anything that becomes an added challenge for drivers on the job. 

Any of the factors mentioned above can affect both FTL and LTL freight rates. How much they impact pricing will vary from carrier to carrier. 

In reality, neither FTL nor LTL may be best. Another option is partial truckload (PTL) shipping. Like LTL, it takes multiple loads, but the difference is that all the loads are likely to have a common destination. 

Before you make any final decisions, examine your average shipping needs. Realize that what works for one delivery may not work for the next. Changing industry circumstances may require a greater amount of flexibility on the part of the shipper and the carrier. 

Take Care of Your Shipping Needs With USA Truckload

Don’t be confused about how to calculate freight shipping costs; let the experts at USA Truckload help. Powered by R+L Global logistics, our services are backed by decades worth of experience in the industry.

Whether you need FTL or LTL shipping, our fleet can get your goods where they need to go while you monitor them in real-time. 

Our trucking services include:

Get a quote today and do the best for your business shipping needs by working with a carrier that won’t let you down. 

Leave a Reply

Your email address will not be published. Required fields are marked *

USA Truckload Shipping Logo
© Copyright 2024 R+L Global Logistics

R+L Global Logistics
315 NE 14th St., Ocala, FL 34470

(866) 353-7178