Can you explain the shipping calculations to me on your site?

Sure thing!

 

First of all, the majority of what we ship are Obutto products. In 2014, we shipped via FedEx over 163 tons worth of product nationwide.  Other products we ship are Computers, Pedals, and some other smaller items like cables, etc. Some items are drop-shipped like Buttkickers direct from other suppliers.

We have two locations: Memphis, TN & Seattle, WA

The following products ship from Memphis, TN (Our Headquarters):

  • Gaming PC's
  • SimPedals
  • Warranty Replacement Parts
  • Most Overnight Warranty Items

Since Memphis is where FedEx's main hub is located, we have a strategic advantage in that in most cases, we can provide our customers with excellent warranty service in some cases where we can overnight warranty replacement/critical parts up till 11pm CST for FedEx Standard Overnight. 

For Obutto products, we utilize our fulfillment warehouse in Seattle, WA (Really Auburn, WA) due to it's close proximity to the Port of Seattle.  This keeps costs low when importing. Below is a list of the Obutto product we ship, their box dimensions, weights, and values that we use when creating shipping labels.

 

  PRODUCT WEIGHT DIMENSIONS VALUE

 

OBUTTO R3VOLUTION FRAME 125LBS 34X32X13 $700
  OBUTTO R3VOLUTION SEAT 40LBS 55X23X12 $60
  R3V TABLETOP 17LBS 24.5X10X4.5 $130
  R3V TRIPLE MOUNT 13LBS 29.5X6X5 $130
  OBUTTO OZONE COCKPIT 114LBS 40X24X23.5 $350
  OZONE TABLETOP 13.2LBS 40.5X17X1 $100
  OZONE TRIPLE MOUNT 15.4LBS 26X10X5.5 $100
  FLIGHT STICK MOUNT/A10 MOUNT 9LBS 13.5X11X7 $50
  STAND ALONE MONITOR STAND 29.7LBS 35X18X9 $130
  ARTICULATING KEYBOARD TRAY 20.5LBS 34X14X6 $100
  CUP HOLDER 1.2LBS 8.5X7X4.5 $10
  SINGLE MONITOR MOUNT (LEGACY OBUTTO ONLY) 11LBS 26X10X5.5 $50
  5.1 SPEAKER MOUNT 9LBS 29X8X3 $90
  NEOPRENE PACK 1LBS 34X1X22 $20

 

 

Now - onto the nitty gritty :-)

 

What is Dimensional Weight Pricing?

Dimensional weight pricing takes into account the space occupied by a package along with its weight, instead of just the latter. So why is this shift towards this new system happening? For a decade, LTL prices have been calculated using only the weight of goods being transported and through the freight classification system. Which means the same price for two different packages having the same weight but different volumes. Obviously, the package that occupies more space gets to ride without paying its fair share.

Another reason for the shift to the new pricing mechanism is to discourage shippers from shipping large containers that mostly contained air, which is unprofitable to carriers. Since the dimensional weight pricing method uses the actual volume of the package to calculate its billable weight, shippers will naturally find ways to make their containers as small as possible to cut the costs, which allows carriers to accommodate more packages in the limited space available.

 

The Implication of Dimensional Weight Pricing on Shipping Costs

While the new mechanism is obviously more scientific, it is likely to increase your LTL shipping costs by 20 percent or even more. You must already have noticed that if you have been shipping regularly. Add to that the annual base general rate increase, fuel surcharges, and other fees, your shipping costs can increase by as much as 30 percent. Therefore, you need to find a way to pack the maximum weight into the minimum volume possible to keep your costs down.

 

Let's use the Obutto R3V Seat above as an example at 55x23x12 @ 40lbs

 

How DIM pricing is Calculated

dimensional weight pricing example

Dimensional weight pricing is calculated by dividing the volume of a package by a mathematical constant called the DIM factor.

  • Dimensional Weight = (Length x Height x Width) / DIM factor

 

Prior to the above rate changes by UPS/FedEx we were being billed at 40lbs for the seat, with the new dimensional pricing, the same box, is now being billed at 91lbs! That is over a 100% increase in shipping cost!

The DIM factor is a constant number considered as the base weight of 1 cubic foot of space and is specific to each carrier. For example, the domestic DIM factor of DHL is 139 and that of UPS and FedEx is 166, while the international DIM factor of both UPS and FedEx is 139. The higher the DIM factor, the lower the dimensional weight and vice versa.

However, it is not enough to calculate the dimensional weight of a package. You must also know its actual weight. This is because whichever is the larger of the two becomes the billable weight.

Here is an example:

Let’s say that your package is 15 inches long, 12 inches wide and 10 inches high. Its volume is 15″ x 12″ x 10″ = 1,800 square inches. Now divide that by 166, which is the most common DIM factor. The dimensional weight of your package is 10.84 lbs. If the actual weight of your package is 9.5 lbs, then 10.84 lbs is used to calculate the shipping rate in your bill. If the actual weight is 12.34 lbs, then 12.34 is used.

As buyers of eCommerce goods, we're all about to see the cost of shipping begin to rise across the globe.  Hopefully this article helps explain things a bit though.

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