Shipping Pallets: 3 Cost Determining Factors

If you have ever dealt with the process of shipping large product orders, you understand just how quickly the costs (and the headaches) can add up. While standards and costs vary between shipping companies, The National Motor Freight Classification is a commonly used set of standards for comparing commodities traveling in interstate, intrastate, and foreign commerce.

Under these guidelines, commodities are grouped into one of 18 possible classes, determined by characteristics such as density, handling, storability, liability, and more. Together, these factors are used to establish a commodity’s transportability and the cost of shipping. Here, we will discuss this classification method’s most critical components and explore general industry standards to help you lower the cost of shipping pallets.

Density

Density is a measurement that takes both volume (the size) and mass (weight) into account.

Size

It is important to remember your shippers are looking for the most efficient means of transporting goods. For example, if your pallets do not evenly fit into the semi-trailer prior to transporting, it will likely reduce the amount of product you can ship in one load. In turn, your shipping costs quickly multiply as a direct result of either splitting your loads into several shipments or repackaging your goods on appropriately sized pallets. 

Weight

In most cases, as the weight of your load increases, so too will the price of shipping. While this may seem straightforward, there are a few important caveats to consider.

Dimensional Weight Pricing

Standard pricing for shipping uses factors such as freight class, size, and fuel costs to determine a full price. However, a new method called Dimensional Weight Pricing is becoming more common in the industry. This system of measurement penalizes high volume, low-density shipments, meaning large pallets with very little product, or overpackaged, light-weight products are charged at a greater rate. 

To take advantage of dimensional weight pricing, you will want to have high-density shipments with lower volumes. Therefore, this shipping strategy is dependent upon the kind of product you ship out.

Another important note is that nearly all shipping companies offer pricing discounts for high volumes. Remember, there is no harm in asking or negotiating for volume discounts in exchange for loyalty to one shipping carrier you trust.

Distance

In the United States, shipping costs are often determined, in part, by using a nine-zone system. Eight of the zones represent a category of domestic shipments in the US and one additional zone is used for outlying territories. This zoning system is dynamic and based on the distance from a shipper’s zip code. 

For example, if your business were based in Los Angeles, CA, and you needed to ship something to Salt Lake, UT, you would be shipping your products to Zone 4. However, if you needed to ship an order to St. Louis, MO, it would be to Zone 7. But, if your business were based in Chicago, IL, Salt Lake would then be in Zone 6, while St. Louis would be found in Zone 3. Essentially, the farther away the shipping destination is from your location, the higher the zone and the more expensive it is to ship. 

Zone-based pricing can have monumental impacts on your business, especially if you offer free shipping. Make sure you understand where the different zones are in relation to your warehouse and how the price points differ for each. 

Shipping Wood Pallets vs Plastic Pallets

One of the biggest drawbacks of using wood pallets is one we’ve discussed many times on our blog. Their susceptibility to fungus and insects makes wooden pallets difficult to work with for those concerned about sanitization. As a result, heat-treatment for all wooden pallets is mandated prior to exporting goods. This treatment heats your wooden pallets to a core temperature of 140 degrees Fahrenheit for a minimum of 30 minutes, killing all potential contaminants before the pallet is used.

Although the cost of heat treating pallets may not seem like much (usually $1 per pallet), it can cause massive delays and result in your load being denied entry if the Heat-Treated (HT) stamp is not present, or if validating paperwork is required at the time of shipping. If the latter is the case, you may have to sell your goods at a discounted rate, pay for return shipping, or lose the product entirely. Those added expenses and headaches are hassles plastic pallet users will never have to deal with. 

Plastic Pallets Pros: Your Pallet Shipping Guides

If you are looking to cut your shipping costs as much as possible, plastic pallets may be the way to go. Much lighter than their wooden counterparts, plastic pallets also do not require heat treatment, have a longer lifespan, can be made for any size requirement, and can nest together on return journeys, all equating to much more cost-effective shipping rates. Talk to our team and learn even more benefits of using plastic pallets for your business. Call us at 877.651.7816 or fill out our contact form today.