The field of transport has grown tremendously in the recent past. This encompasses all fields like sea transport, air transport, road transport and rail freight. The diversification in the freight industry has led to competition with each field striving to provide a range of efficient services in order to attract new customers and retain the existing ones. Competition has played a bigger role in determining how freight charges are arrived at. In most of the cases, competition has been regarded as healthy as it has seen a significant reduction in freight charges to the pleasure of customers. Customers have a wide range of transport providers to choose from hence the need to offer unique service in the field. This will enable players in the transport field to gain competitive advantage over their colleagues. Freight charges are determined by a number of factors that include the following;
First, the distance to be covered is the dominant factor. There are transport solutions to both short and long distances. Some consignees will send packages over short distances while others will send over long distances. In determining freight charges, the longer the distance, the higher the charges will be. Cargo that is destined for shorter distances attract little freight charges. This works on the premise that the shorter the distance, the less the operational costs involved. This plays a bigger role in determining freight charges.
Moreover, the weight of the consignment also determines the freight charges to be applied. Very heavy consignments will attract more charges as compared to consignments that are light in weight. Heavy consignments are considered to have an effect on the fuel consumed by the transporting vessel. This means an extra expense in terms of fueling the vessel. In addition, heavy luggage will mean that the transporting vessel will have to carry few consignments as compared to transporting much lighter consignments. This also helps to determine charges.