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04_16 - Air Freight Calculations(TBD)
04_16 - Air Freight Calculations(TBD)Business Management and Finance Courses » Udemy - International Logistics & Transportation in Supply Chain. 2023-5 |
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| 04 - Air Cargo Udemy - International Logistics & Transportation in Supply Chain. 2023-5 0 00:00,090 --> 00:01,710 Air freight calculations. 1 00:02,010 --> 00:04,580 So what is air freight? Air Freight is 2 00:04,650 --> 00:12,000 The way in which the airline charges for the transportation cost of cargo from the airport of loading 3 00:12,270 --> 00:17,280 to the airport of discharge that is from the exporting country to the importing country. 4 00:17,370 --> 00:22,190 So if you want to move your cargo, you need to pay the airline the air freight. 5 00:22,260 --> 00:27,810 And in case of container shipping, you will need to pay Ocean freight and in case of road mode of transport, 6 00:27,960 --> 00:28,550 road freight. 7 00:28,560 --> 00:31,590 Whereas in railmode of transport, you need to pay rail freight. 8 00:31,740 --> 00:34,110 So how do we calculate air freight? 9 00:34,260 --> 00:40,260 This is very important to understand as the calculation of air freight is very simple. 10 00:40,380 --> 00:45,790 But sometimes people complicate this thing so much as they are, concepts are not clear. 11 00:45,810 --> 00:52,470 So I will make you clear your concepts first, and then we will solve numerical who understand how to 12 00:52,470 --> 00:54,360 calculate the air freight. 13 00:54,420 --> 01:00,870 So the most important thing when it comes to calculation of anything is to calculate the chargeable weight. 14 01:01,230 --> 01:02,460 Now what is chargeable weight? 15 01:02,470 --> 01:06,960 We every cargo occupies space and it has a weight. 16 01:06,990 --> 01:10,740 But there are two types of restriction when it comes to transport of cargo. 17 01:10,980 --> 01:12,150 One is the volume. 18 01:12,570 --> 01:14,400 And the other one is the gross weight. 19 01:14,670 --> 01:20,180 So 1 ton cotton will occupy more space compared to 1 ton of steel. 20 01:20,550 --> 01:28,020 So the volumetric weight of cotton is higher as it is occupying more space, whereas one ton of steel 21 01:28,080 --> 01:34,620 occupies less space, so the chargeable weight of cotton will be on the basis of volumetric, as cotton 22 01:34,620 --> 01:40,180 is like soft and fluffy, so it occupies more space compared to a heavy metal 23 01:40,650 --> 01:44,290 And when it comes to steel, it is hard, heavy and tough. 24 01:44,340 --> 01:48,780 So the chargeable weight of steel will be on the basis of gross weight. 25 01:49,050 --> 01:55,230 So from this, we can see that a lighter material of same gross weight occupies more space compared 26 01:55,230 --> 01:56,700 to a heavier material. 27 01:56,700 --> 02:02,460 So the air freight will be charged for the lighter material based on the volume it occupies. 28 02:02,460 --> 02:08,010 It is volumetric weight, whereas the heavier materials air freight will be charged on the basis of the actual 29 02:08,010 --> 02:09,840 gross weight of the cargo. 30 02:09,870 --> 02:16,050 So from this we can see that we need to consider the volumetric weight and gross both, and the chargeable 31 02:16,050 --> 02:18,620 weight will be the weight, which is higher. 32 02:18,630 --> 02:24,420 Every volumetric weight of a cargo is higher, it will be the chargeable, weight whereas if the growth weight 33 02:24,420 --> 02:30,480 of the cargo is higher, it will be chargeable weight as finding the gross weight is very simple. 34 02:30,640 --> 02:32,760 What about the volumetric weight? 35 02:32,790 --> 02:36,970 So let's understand how to calculate the volumetric weight of a cargo. 36 02:37,020 --> 02:45,660 So the formula to calculate the volumetric weight is LxBxH in centimeters divided 37 02:45,660 --> 02:46,870 by 6000. 38 02:46,890 --> 02:54,270 So this length x breath x height is the dimension of the package or the cargo, and the dimensions 39 02:54,600 --> 02:58,020 should be in centimeters divided by 6000. 40 02:58,050 --> 03:03,760 So when you multiply the length x breath x height which are in centimeters, you will get a number. 41 03:04,020 --> 03:06,780 So you need to divide that number by 6000. 42 03:07,020 --> 03:09,880 So you will get the volumetric weight of the cargo. 43 03:09,930 --> 03:15,850 Now you need to compare the volumetric weight with the actual gross weight of the cargo. 44 03:15,900 --> 03:21,630 if the volumetric weight which you have calculated is higher than the gross weight of the cargo. 45 03:21,690 --> 03:27,240 The volumetric weight will be the chargeable weight, whereas if the gross weight is higher than the volumetric 46 03:27,240 --> 03:30,240 weight, the gross weight will be, the chargeable weight 47 03:30,450 --> 03:37,050 So let's solve the numerical to understand the calculation, to find the chargeable weight of a consignment 48 03:37,050 --> 03:39,780 of 3 parcel with the same dimensions. 49 03:40,110 --> 03:43,470 So there are three parcel who have same dimensions. 50 03:43,500 --> 03:50,470 So from this we can see that we have to calculate the volumetric weight of a single parcel, then multiple 51 03:50,730 --> 03:52,530 volumetric weight by 3. 52 03:52,860 --> 03:58,990 If there were 3 parcels of different dimensions, we had to calculate volumetric weight of all the 53 03:59,010 --> 04:04,280 3 parcels separately and then sum up to find the actual volumetric weight. 54 04:04,320 --> 04:10,380 but here there are three parcel with same dimensions, so we'll calculate the volumetric weight of a single parcel 55 04:10,380 --> 04:12,010 and then multiply it by three. 56 04:12,030 --> 04:17,410 So the dimensions of the parcel is 76, 55 and 40. 57 04:17,430 --> 04:24,990 So the length is 76, width is 55 centimeters and the heights 40 centimeters on multiplication. 58 04:25,020 --> 04:29,190 We get a number that is 167,200. 59 04:29,220 --> 04:33,290 So we need to divide this number by 6000, which is a constant. 60 04:33,450 --> 04:39,870 Usually all the airlines use 6000 to divide the dimensions of centimeters. 61 04:40,200 --> 04:47,610 Some airlines may use 5500, but the regular practice is dividing the number by 6000. 62 04:47,640 --> 04:54,720 So on division by 6000, the volume weight of a single parcel is 27,87. 63 04:55,440 --> 04:57,020 So we have 3 parcel. 64 04:57,030 --> 04:59,370 We need to multiply 27,87 x 3. 65 04:59,680 --> 05:00,820 . 66 05:00,970 --> 05:07,930 So we have the volumetric weight of all the 3 parcels i.e is 83,6 kgs. 67 05:07,960 --> 05:11,690 Now we need to compare the volumetric weight with the gross weight. 68 05:11,980 --> 05:17,340 The gross weight is 80 kgs , whereas the volumetric weight is 83,6 kgs. 69 05:17,540 --> 05:26,290 So we can see that the cargo that is there inside the 3 parcels is lighter in weight as it occupies more 70 05:26,290 --> 05:32,050 space compared to the actual grossly so the chargeable weight will be 83,6 kgs 71 05:32,710 --> 05:37,720 So we already have the chargeable weight, which is the volumetric weight in this consignment. 72 05:37,780 --> 05:44,650 So the freight quoted by the freight forwarder who is a middleman between the airline and the exporter 73 05:44,650 --> 05:50,140 and importer who is a freight forwarder, we will discuss as the freight forwarder buys rate from the 74 05:50,140 --> 05:54,200 airline and quotes to the exporter and importer who are his clients. 75 05:54,220 --> 05:59,540 So the freight quoted by the freight forwarder from Mumbai to Dubai is $4 per kg. 76 05:59,560 --> 06:02,350 So our chargeable weight is 83,6. 77 06:02,500 --> 06:10,540 So we need to multiply 83,6 by four so the air freight will be $334,4. 78 06:10,570 --> 06:18,220 So from this we can say that the three parcels of Dimension 76, 55 and 40 will be shipped from Mumbai 79 06:18,220 --> 06:22,600 to Dubai and the total air freight of $334. 80 06:22,600 --> 06:25,180 And the chargeable weight is the volumetric weight. | ||||
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