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How Do Courier Companies Arrive At Their Pricing?



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By : Paul McDuffy    99 or more times read
Submitted 2010-01-27 17:51:03
There are several things that go into the final price that any courier company is going to arrive at when you place an order with them. Every Arkansas courier is going to have some kind of a formula that they use to come up with the final billing amount. Then, based on the particulars of your order, they will just plug all the numbers based on the information you provide them into the formula, and come up with the final amount owed.

To start learning how courier companies decide how much to charge you, you have to first learn about something which is called the freight rate. This is like a figure which a courier company is going to assign to every shipment, and it is based on both the size and the weight of your cargo. That is then combined with any special needs your package might have, such as being transported in a refrigerated unit or being especially breakable to come up with your freight class.

The freight class is used together with the distance that your package is going to be traveling to come up with your base price. However, from there, there are still several further adjustments which might be made before your final bill is arrived at.

Courier companies usually have a long list of surcharges which they bill to you for various things which might be specific to your order. This includes things like having your order picked up on a holiday after hours. The order will also be charged at a higher rate if you want it delivered any faster than the regular, economy shipping time. There are usually several different shipping speed options, ranging up to same day or one hour deliveries depending on the distance that you are shipping. Courier companies are required by law to disclose all their fees if you ask beforehand, a good way to get an upfront cost estimate.

Finally, you'll have that amount adjusted based on any local taxes that you have to pay. If you're shipping internationally there are likely going to be some extra taxes and duties that you have to pay on your order. As well, when shipping across international borders you will have to pay a brokerage fee, as well as possibly having to pay documentation fees for the various types of additional paperwork that your courier will have to prepare in order to get your shipment across the border.

Author Resource:

Paul McDuffy is a consultant for northwest arkansas courier service and missouri freight service companies as well as national courier service businesses.

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