02 Oct What Is Dimensional Weight Pricing?
Dimensional Weight Pricing Basics
updated January, 10th 2018
Dimensional weight pricing (DIM) is a new technique employed by the shipping companies to make more money from your shipments. Since lightweight packages take up the same amount of space as heavy ones in the shipping vessel, the carriers realized that they were potentially losing money by shipping large, light-weight packages. Therefore, they could increase their profits by estimating the weight of a package based on its dimensions (length, width, and height) rather than its actual weight. The result: DIM weight pricing.
How does DIM Weighted Pricing Work?
Why is this a concern for your business? Well, in combination with recent UPS and FedEx increases, DIM weight pricing can have a substantial impact on your shipping costs. Let’s say you have a package that is 24″ × 15″ × 10″ and weighs 10 pounds. The UPS standard ground base rate to ship that box to Zone 5 is $12.42.
However, that same box is now subject to DIM weight pricing. Here’s the calculation:
DIM Weight = L × W × H
So, for this box the calculation is:
24″ × 15″ × 10″ = 3,600 cubic inches
3,600 cubic inches / 139 = 25.9 pounds
DIM weight = 26 pounds
This brings the total cost up to $19.42, which equates to a 56.36% increase—for the exact same box!
More worrisome still is the fact that this represents an 18.85% increase over 2016 prices, which means that the carriers can (and likely will) increase rates again in the future.
2018 UPS & FedEx Dim Weighting Factors
In 2018, FedEx will begin using a dimensional weight factor of 139 matching the DIM factor already in use for UPS except there is one nuance. The UPS DIM factor for packages under a cubic foot is still 166. That gives UPS a slight advantage on smaller light weight packages over FedEx. Once you get above a cubic feet, UPS uses a DIM Factor of 139 as well.
If you need help, both UPS and FedEx have Dimensional Weight calculators you can find here. Visit the UPS and FedEx sites to learn how to calculate this number (FedEx has a calculator that does the work for you).
What do I do about DIM weighted shipments?
So what can you do to guard against these inflated costs? For starters, make sure you know the DIM weight of the packages you’re sending. Visit the UPS and FedEx sites to learn how to calculate this number (FedEx has a calculator that does the work for you).
Next, reevaluate your shipments, especially if you ship large, lightweight items. Is it possible to decrease the size of your shipping boxes? Calculate the cost of shipping in multiple boxes or sending your item in a non-assembled form. Decreasing box size by even an inch or two can help lower your total cost. However, for many shippers, this may not be a viable solution.
Given the increased cost, it may make sense to consider utilizing another fulfillment center for larger items or even considering freight delivery. All of these options are easier to calculate if you have good data on our shipping profile, which is not always that easy. A free Franklin Parcel Account will give you everything you need to get started.