Freight rates for small shipments

✍ Scribed by F.J. Arcelus; J.E. Rowcroft

• Book ID: 103961753
• Publisher: Elsevier Science
• Year: 1993
• Tongue: English
• Weight: 578 KB
• Volume: 30-31
• Category: Article
• ISSN: 0925-5273
• DOI: 10.1016/0925-5273(93)90122-2

✦ Synopsis

Implementation ofjust-in-time production planning policies has resulted m the expected lower level of inventories for many firms. Often, it has also resulted m higher per umt freight charges due to the mabthty to qualify any longer for the cheaper rates, which accompany lugher volume shipments. This in turn has led to an update of the procurement practices on the part of many firms and a new look at small volume freight rates, such as less-than-truckload (LTL) and small parcel rates (SPR). This paper seeks to study the determmants which help set these small volume trucking rates, with a view to how they may react to changes in customers' inventory policies. The analysis is performed using the CANPAR (Canada Parcel) tariff for September 1990 for packages from 11 to 500 lb. each. This tariff IS divided into eleven schedules or 'zones' and each route is assIgned to a zone based on the postal codes of Its end pomts. Among the factors hypothesized to Influence the rates are weight, distance. number of shipments on the return route and the effects of Canada's umque geographical composltlon.