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05_25 - FCL vs LCL vs Air Freight(TBD)
05_25 - FCL vs LCL vs Air Freight(TBD)Business Management and Finance Courses » Udemy - International Logistics & Transportation in Supply Chain. 2023-5 |
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| 05 - Ocean Shipping Udemy - International Logistics & Transportation in Supply Chain. 2023-5 0 00:00,060 --> 00:02,270 Calculation for best mode of shipment. 1 00:02,280 --> 00:07,140 So till now we have learnt how to calculate the chargeable weight and how to calculate the airfreight. 2 00:07,170 --> 00:12,180 Also we have learnt how to calculate the volume for a LCL shipments and for FCL 3 00:12,210 --> 00:17,580 it is obvious that it will be a flat rate which a shipping line will quote on the basis of the type of 4 00:17,580 --> 00:18,870 container you require. 5 00:18,960 --> 00:24,990 So we have learnt to calculate 3 types of shipment that is by air, by FCL, and LCL. 6 00:25,050 --> 00:30,560 So let's take an example where we have cargo and we have to select the best mode of transport and to 7 00:30,570 --> 00:35,970 calculate the profitable way in which we can move our cargo from one country to another. 8 00:36,000 --> 00:43,470 So here is an example where there are hundred cartons of dimension 0,6 meters in length, 0,4 meters 9 00:43,470 --> 00:49,410 in breath, and 0,4 meters in height with a gross weight of 1500 kgs. 10 00:49,410 --> 00:54,860 And the cargo is Men's t-shirts which has to be shipped from Mumbai to Dubai. 11 00:54,870 --> 01:00,180 And we are here to calculate the best option to move this freight from Mumbai to Dubai. 12 01:00,270 --> 01:07,030 So as we have the dimensions of 100 cartons which are in meters we will calculate the CBM or LCA shipment. 13 01:07,050 --> 01:17,340 So when we multiply 0,6 with 0,4 and 0,4 we will get 0,096 CBM for per carton which is approx 0,1 CBM 14 01:17,340 --> 01:23,700 per carton. Now we have 100 cartons so we will multiply 0,1 with 100 which is 10 CBM. 15 01:23,760 --> 01:26,790 So we have 10 CBM of cargo in volume. 16 01:26,790 --> 01:29,910 And when we compare it with the gross weight it is 1500 kg. 17 01:30,300 --> 01:36,330 So here the volume is greater than the gross weight as the gross weight of the cargo is just 1,5 tones. 18 01:36,390 --> 01:43,350 Consolidator will quote us the rate on the basis of volume which is 10 CBM and the consolidator has already 19 01:43,350 --> 01:47,760 quoted us the rate for LCL shipment from Nhava Sheva to Jebel Ali. 20 01:48,030 --> 01:54,210 Now Nhava Sheva is a port in Mumbai and Jebel Ali is a port in United Arab Emirates which is near to 21 01:54,270 --> 01:54,670 Dubai. 22 01:54,690 --> 02:00,990 So the consolidator has quoted us $50 per kg that is weight measurement, whichever is higher. 23 02:00,990 --> 02:07,620 So W/M means weight, per measurement that is if weight is higher then we need to multiply $50 24 02:07,620 --> 02:11,500 with the weight but here measurement is higher that is the volume is higher. 25 02:11,520 --> 02:17,640 So we need to multiply 50 with ten CBM, which will give us the LCL freight from Nigeria to Jebel Ali 26 02:17,640 --> 02:25,770 at $500 to move 100 cartons of dimension 0,6, 0,4 and 0,4 with a gross weight of 1500 kgs 27 02:26,160 --> 02:32,490 So we already have LCL freight, to move the cargo, but with LCL there are other additional charges like 28 02:32,570 --> 02:35,340 the destuffing charges, this stuffing charges. 29 02:35,340 --> 02:38,700 So there are additional charges for say around $500. 30 02:38,700 --> 02:45,050 So the total freight cost will be around $1,000 to move 100 cartons by LCL mode. 31 02:45,090 --> 02:47,220 Now let's calculate the FCL shipment. 32 02:47,640 --> 02:54,330 So we contacted our shipping line and the shipping line quoted as the rate for 1x 20 feet as 1$800 33 02:54,330 --> 02:57,900 to move our container from Nhava Sheva to Jebel Ali. 34 02:58,050 --> 03:00,240 So we have calculated two options. 35 03:00,240 --> 03:06,150 And the freight, both the options in LCL, the move 100 cartons , we have to pay $1000 to the 36 03:06,150 --> 03:10,650 consolidator and if we are moving it by FCL, we have to pay $1800 . 37 03:10,680 --> 03:16,290 Now let's calculate how much it will take to move 100 cartons and read guidance by our mode of transport. 38 03:16,380 --> 03:20,910 First of all, we will convert the dimensions from meters to centimeters. 39 03:20,910 --> 03:26,790 It is very important as the formula to calculate the volumetric weight when it comes to air shipment 40 03:26,790 --> 03:32,820 is lxbxh and the dimensions should be in centimeters divided by 6000. 41 03:32,820 --> 03:35,880 So let's convert the meters into centimeters. 42 03:35,880 --> 03:40,830 So when we multiply the dimensions with 100, we will get the dimensions in centimeters. 43 03:40,830 --> 03:47,220 So 0,6 x 100 , 0,4 x 100, 0,4 x 100 44 03:47,250 --> 03:54,960 So we will get 60 as length in centimeter 40 as breath in centimeter and 40 as height in centimeter divided by 45 03:54,960 --> 03:57,330 6000, which is a constant. 46 03:57,330 --> 04:04,050 So when we put all the values and all the formula, the answer which we get is 16kgs , which is 47 04:04,050 --> 04:06,240 a volumetric weight per carton. 48 04:06,630 --> 04:07,110 but here we have 49 04:07,110 --> 04:13,680 100 cartons, so to calculate the total volumetric weight, we need to multiply 16 x 100, 50 04:13,680 --> 04:15,420 which is 1600 kgs. 51 04:15,600 --> 04:21,390 Now comparing the volumetric weight that is 1600 kgs, which we have obtained by calculation with 52 04:21,390 --> 04:23,700 the gross weight of the 100 carton. 53 04:23,730 --> 04:28,110 So we can say that the volumetric weight is higher than the gross weight. 54 04:28,110 --> 04:32,830 So we will multiply the airfreight per kg with with 1600 kgs. 55 04:32,860 --> 04:39,180 So chargeable weight is 1600 kgs and the air freight which we have received is $2 per kg. 56 04:39,180 --> 04:45,900 So when we multiply $2 with 1600 kgs , we will get $3200 as the air freight. 57 04:46,020 --> 04:50,880 So now we have calculated the freight for all the 3 modes that is by LCL. 58 04:50,880 --> 04:58,080 We have obtained $1,000 by FCL, we have obtained 1800 dollars and by air mode of transport we have 59 04:58,080 --> 04:59,940 airfreight at $3200. 60 05:00,250 --> 05:06,370 As per my understanding, 100 cartons of dimensions and also 1500 kgs. 61 05:06,400 --> 05:14,200 The best suited mode is by LCL as it provides us the cheapest option and we can save around $800 compared 62 05:14,200 --> 05:17,680 to FCL and around $2200 by air. 63 05:17,710 --> 05:24,250 But if your importer requires the cargo on urgent basis, you can go for air mode of transport if time 64 05:24,250 --> 05:26,020 is more important than money. | ||||
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