Air cargo has boomed alongside e-commerce, but that growth comes with a challenge: rising shipping costs. Hidden factors in your invoices, from dimensional weight calculations to packaging choices, can significantly inflate what you pay per shipment.
Fortunately, being more mindful about how you pack and weigh parcels can lead to substantial savings.
The unforeseen challenge
About 48 billion parcels are shipped yearly through express courier services, which typically rely on air cargo transportation. As the surge continues, air cargo carriers are meant to coordinate and ensure these shipments are sent cost-effectively.
Components like base rates and fuel surcharges change over time, depending on the market, and affect the final invoice. However, aircraft cubing out before they weigh out is a recent change that has been flying under the radar despite the challenges it brings. It’s faster to reach volume capacity rather than weight capacity, which can result in fewer packages per trip.
Protecting the margins
Air freight is carried on a mix of commercial passenger airlines and dedicated cargo planes operated by companies like UPS, FedEx, and DHL. Though airfreight accounts for less than 1 percent of the world’s trade tonnage, it handles a disproportionate share of high-value, time-sensitive items like pharmaceuticals, electronics, and perishables.
The e-commerce boom has created a capacity problem. Cargo space on aircraft is limited, and bulky, inefficiently packed parcels take up far more room than their actual weight would suggest. A lightweight but oversized box wastes the same space as a dense, heavy package, but brings in less revenue for the airline.
That’s why carriers adopted dimensional (DIM) weight pricing. Instead of charging based solely on actual weight, they calculate rates using package dimensions, ensuring shippers pay for the space they consume. For many e-commerce businesses, this shift has led to sticker shock when invoices arrive.
The core math
When calculating freight costs, the main pricing models are either weight-based or volume-based. Weight-based pricing focuses on the total weight of heavy items, while volume-based pricing charges based on the space the cargo occupies.
The problem with weight-based pricing for e-commerce brands, logistics companies and airlines is that the total weight would often exclude package density despite the space it would take up. Whether a parcel is flying in the belly of a 777 or riding in a dry van, volume-based pricing is a better equaliser.
Aircraft space has become a key commodity, so deals based on dimensional weight are ideal for all parties. To calculate DIM weight, multiply the length by the width and height of the item. Divide the product by the DIM factor.
Adjusting to the changes
Making better parcel packaging choices can reduce inflated invoices and ensure space is taken up at a reasonable price. Here are tips that can help.
1. Packaging
Cutting out excess packaging is one of the simplest ways to adapt to the changes. The less bulky the parcels are, the more air capacity is available for other items. Additionally, it reduces packaging waste, online shopping creates 4.8 times more waste than offline shopping. It even has the potential to produce an additional 10 percent of total waste over the next 10 years.
Match the box sizes to focus on protecting the product without using extra space. Other logistics companies are also focusing on mailers, flexible wraps and parcel bags to minimise the rigidity of these items, since it means fitting a couple of additional items.
2. Consolidatation
Consolidating shipments into one singular package has been an effective technique in managing order frequency, especially during peak shipping times and seasons. The principles behind it can also help with minimising DIM weight in the long run.
Focus on keeping every item safe, even when shipping items together. Cutting costs should not equate to a poor customer unboxing experience.
3. Investment
Using smart technology, such as scanning systems and scales, can help in measuring DIM weight more accurately and account for savings. It could also minimise packaging errors that would slow down fulfillment cycle times. Warehouse management systems are also ideal for automating data collection and using cartonization logic.
4. Negotiation
The DIM weight calculation is straightforward, but the divisor can be negotiated to save on shipping costs. Coordinate with airlines to understand and modify contracts to be more favourable. Discounts are vital when shipping a high volume of parcels or during peak seasons.
Optimise services
Shifting the focus onto DIM weight may not have been welcomed, but it can greatly help the teams for e-commerce, logistics and airlines realign on the ideal pricing and arrangement. Optimise the air capacity parcels are using and ensure minimal to no disruptions to the supply chain.
Oscar Collins is the editor-in-chief of Modded. He has over five years writing in logistics, with bylines at Global Trade Mag, EE Times and similar publications.
The post The E-Commerce DIM Weight Crunch: How Bulky Parcels Are Squeezing Air Capacity appeared first on Air Cargo Week.
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