5 Factors That Influence Your Air Freight Cost

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5 Factors That Influence Your Air Freight Cost

Air freight forwarding service is fast, reliable, and flexible. Transporting goods by air enables shippers to respond to customers and market demands quickly. However, the air freight costs are often highly uncertain. There are several factors that influence the transportation cost.

This article covers some of the key factors that contribute to air freight costs. Have a glance through it once. It will help you get an idea of how expensive or cheap your air freight shipments would be.

Fuel

The cost of air freight forwarding service depends on the fuel price. As fuel prices increase, transportation becomes costlier to operate. And of course, if the fuel price decreases the operating cost becomes cheaper. Savings or losses are then passed on to consumers – indirectly or through a fuel cost component built by the logistics company or the air freight forwarder.

Weight and Volume

Weight and volume are crucial factors when quoting a price. A shipment that is light in weight but large in volume takes up space that could be used for other shipments. This thereby reduces the revenue for the flight.

So for example, if you are transporting some furniture, and the warehouse packages them in a considerably larger box than needed - you will be charged much more for this package based on the dimensional weight pricing. Because although the package is very light, it is taking up unnecessary amounts of space that could be used for other goods.

Economic Conditions

 Economic conditions do affect air freight forwarding pricing. In times of economic downturn the air freight demand decreases which in turn lowers the prices as carriers try to fill unused cargo space. Conversely, in times of economic prosperity, the demand rises, leading to higher service prices.

Government Regulations

Traditional government regulations contribute to the overall cost structure. For example, some governments often set maximum driving hours for commercial operators.

Even environmental regulations affect the overall operating expenses and profitability. Environmental and sustainability policies aimed at improving carbon efficiency and cutting emissions are becoming more prevalent around the world. Some airports even impose environmental surcharges. For example, recently London’s Heathrow, proposed increasing environmental charges to address noise pollution. Complying with these restrictions can affect everything from material usage to handling costs etc.

Distance/ Destination

Destination/route does affect the marginal cost of air freight forwarding service. So more the distance more will be the cost of shipping. However, the cost varies from place to place. Rates also apply based on the type of route offered i.e. direct service versus connecting service. Even cargo transfers that involve several carriers also contribute to the final cost.

The air freight forwarding service is a highly complex task. Setting the service rate that is both profitable and competitive requires proper analysis.

New Globe Logistik LLP is one such firm that offer air freight forwarding services at an affordable price range. The air freight services in India are executed by a team of well-qualified and highly trained professionals who work closely to execute each task with a high level of efficiency. The expertly managed team also pays strict attention to environmental, health, and safety issues at every stage.

To know more about this air freight forwarder – contact the team today!

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