Transportation cost examples
Variable Transportation Cost example 1
Assume the following input data:
Products
| Product Name | Unit Weight | Unit Volume |
|---|---|---|
| Product1 | 2 LB | 5 CFT |
Modes
| Mode Name | Variable Transportation Cost | Shipment Size |
|---|---|---|
| FTL | 1 USD | 1000 EA |
Transportation Policies
| Source | Destination | Product | Mode | Transport Time | Distance |
|---|---|---|---|---|---|
| MFG | DC | Product1 | FTL | 2 HR | 100 MI |
The following table shows how the per unit transportation cost is calculated. The transportation cost per unit is then multiplied by the flow:
| Variable Cost Basis | Calculation | Transportation cost per unit |
|---|---|---|
| Quantity | 1 USD * 1 EA | 1 |
| Weight | 1 USD * 2 LB | 2 |
| Volume | 1 USD * 5 LB | 5 |
| Distance (Quantity-based) |
1 USD * 1 EA * 100 MI / 1000 EA |
0.1 |
| Distance (Weight-based) | 1 USD * 2 LB * 100 MI / 1000 EA | 0.2 |
| Distance (Volume-based) | 1 USD * 5 CFT * 100 MI / 1000 EA | 0.5 |
| Time (Quantity-based) | 1 USD * 1 EA * 2 HR / 1000 EA | 0.002 |
| Time (Weight-based) | 1 USD * 2 LB * 2 HR / 1000 EA | 0.004 |
| Time (Volume-based) | 1 USD * 5 CFT * 2 HR/ 1000 EA | 0.01 |
| Quantity-Distance | 1 USD * 1 EA * 100 MI | 100 |
| Quantity-Time | 1 USD * 1 EA * 2 HR | 2 |
| Weight-Distance | 1 USD * 2 LB * 100 MI | 200 |
| Weight-Time | 1 USD * 2 LB * 2 HR | 4 |
| Volume-Distance | 1 USD * 5 CFT * 100 MI | 500 |
| Volume-Time | 1 USD * 5 CFT * 2 HR | 10 |
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If your Shipment Size is expressed in Weight, a Product Unit Weight of 0 is invalid when calculating transportation costs. The cost will use the Shipment Size rather than Unit Weight.
-
If your Shipment Size is expressed in Volume, a Product Unit Volume of 0 is invalid when calculating transportation costs. The cost will use the Shipment Size rather than Unit Volume.
Errors are logged in the ErrorLog.text file.
Variable Transportation Cost example 2
In another example, we review how the total transportation cost is calculated for a given number of demand units. The Variable Cost Basis is distance, so the Shipment Size is included. Demand of 1,000 units at a Unit Weight of 20 lbs each are shipped 40 miles. Each truck shipment can handle 5,000 lbs. The Variable Transportation Cost is $10 per mile:
are needed for a total distance traveled of
This would mean the overall cost would be
Last modified: Wednesday May 15, 2024