Basic Settings for Freight Cost and Freight Cost Calculation
Freight cost settings and calculation
Basic settings for freight cost - freight cost management parameter
The 'freight cost management' parameter in (CRS728) decides whether freight cost will be calculated according to the freight agreement connected to a delivery or shipment. The calculation can be completed manually at any time before the delivery or shipment is closed. The automatic calculation of freight cost is completed when the delivery or shipment is closed.
Basic settings for freight cost and settings - freight cost calculation on freight agreement
The freight cost calculation is based on the freight agreement and transportation service connected to the delivery or shipment, and uses the information available at the time of the calculation.
These sections explain the settings on the freight agreement for freight cost calculation:
Settings on the freight agreement header (PPS100)
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When creating a freight agreement in (PPS100) opening panel, the purchase agreement type (PPS110) must be a freight agreement type. The supplier for which the agreement is defined can only be of supplier type 5 – Forwarding agent.
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'Freight rate aggregation level' indicates the level (either the shipment or the delivery level) in the dispatch flow on which the agreement will be connected.
Settings on the freight agreement lines (PPS101)
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In (PPS101), the 'Group ID' field for freight agreement lines is always visible but cannot be edited. It will always choose the group ID that has Transportation Service as the selection field. If no group ID exists with Transportation Service, one will be automatically created. Group ID 88 is generated in (CRS746).
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In the (PPS101) opening panel, select a 'Transportation service ID' for which the freight elements and rates should be defined. These are defined in (DRS025).
Freight cost element connected to freight agreement (PPS105)
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In (PPS101), select Related option 12='Freight Elements'. This starts 'Purchase Agreement. Connect Freight Cost Element' (PPS105).
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On the opening panel of (PPS105), specify a sequence number for the first freight element. Go to the detail panel and select a freight cost element in the 'Freight rate element' field. Only costing elements with operator 88='Freight cost' can be selected. Freight cost elements are defined in (PPS280).
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Select a 'Freight cost operator'. The operator contains the formula for retrieving the cost of the freight cost element per delivery or shipment (depending on aggregation level set on the freight agreement). The value of the freight cost element is either added or deducted from the grand total, depending on whether a markup is selected for the costing element in (PPS280). See Freight Cost Management for more information about freight cost operators.
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The 'Scale unit type' sets which type of unit for the freight scale, if any, is used to determine which transaction data from the delivery or shipment (depending on the aggregation level of the freight agreement) retrieves the correct freight rate for a freight element. A check is made to ensure that the correct operand is used, since all freight scale unit types are not allowed for all operands.
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The 'Rate factor' is the multiplier used against the freight rate on the freight cost element to calculate the actual freight rate.
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In 'Field 1, 2 and 3', you can select an object for which a special freight rate applies. An object represents the cause that triggers a particular freight rate. You can select a maximum of three objects for a freight cost element.
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The 'Markup' check box is set if the costing element percentages are positive, which a markup is. If it is not set, then the costing element percentages are negative, which is a markdown.
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The 'Lowest price element' check box is set to enable a comparison to find the lowest price within a freight cost element. If lowest price element is selected and a scale unit type is used, the system will compare the calculated value for the actual scale unit value and its corresponding rate. When the freight cost is calculated, it will use the lowest element value (scale unit value * freight rate) of them.
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The 'Manual update – freight rate' check box is set to enable the calculated value to be manually changed and saved in simulation and calculation mode (DRS500).
In (PPS105/E), these are the permitted and non-permitted combinations of freight cost operators and scale unit types:
Freight operator/Scale unit type | 1-Gross weight | 2-Volume | 3-Transaction | 4-Distance | 5-Detention hours | 6-Number of packages |
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02-Fixed amount | Yes | Yes | Yes | Yes | Yes | No |
10-Price per gross weight of assigned goods | Yes | No | No | No | No | No |
11-Price per gross weight of packed goods | Yes | No | No | No | No | No |
12-Price per packed gross weight | Yes | No | No | No | No | No |
13-Price per volume of assigned goods | No | Yes | No | No | No | No |
14-Price per volume of packed goods | No | Yes | No | No | No | No |
15-Price per packed volume | No | Yes | No | No | No | No |
16-Price per free capacity unit of assigned goods | No | No | No | No | No | No |
17-Price per free capacity unit of packed goods | No | No | No | No | No | No |
18-Price per packed free capacity unit | No | No | No | No | No | No |
19-Price per detention hour | No | No | No | No | Yes | No |
25-Price per package | No | No | No | No | No | Yes |
26-Price per package with package level 0 | No | No | No | No | No | Yes |
35-Price per distance (One way) | No | No | No | Yes | No | No |
36-Price per distance (Return included) | No | No | No | Yes | No | No |
45-Price per transaction quantity - basic U/M | No | No | Yes | No | No | No |
46-Price per picking list quantity - basic U/M | No | No | Yes | No | No | No |
47-Price per transaction quantity - alternate U/M | No | No | Yes | No | No | No |
48-Price per picking list quantity - alternate U/M | No | No | Yes | No | No | No |
70-Price per delivery (CMR) | No | No | No | No | No | No |
71-Price per place of unloading | No | No | No | No | No | No |
72-Price per unloading sequence | No | No | No | No | No | No |
Freight rates connected to freight cost element (PPS109)
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In (PPS105), select related option 12='Scaled Rates'. This starts 'PO Agreement. Connect Scaled Freight Rates' (PPS109).
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Specify the 'From date' and open the detail panel.
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On the detail panel, specify the 'freight rate' and 'from value' if that field is editable for the specific freight operator. You must always specify at least one freight rate here.
Create freight cost zone and connect to a forward agent
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Start 'Freight Cost Zone. Open' (DRS032) and create a freight cost zone.
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Start 'Forward Agent. Connect Freight Cost Zone' (DRS034). Select a forward agent and connect a freight cost zone.
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On the (DRS034/B) panel, select option 11='Place of unload'. This launches (DRS033). Connect the forward agent and freight cost zone to a place of unload.
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Start 'Supplier. Open' (CRS620) and select option 22='Forwarder/Freight cost zone'. Select the freight cost zone, defined in (DRS034).
Connect the transportation service ID to a delivery or shipment
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Start 'Dispatch Policy. Open' (MWS010).
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On the (MWS010/I) panel, the '500 Retrieve transportation service from' field determines one of the following:
- Alternative 1: You must have connected a transportation service ID to (DRS006) and (DRS005). It must be the same transportation ID that you have in (PPS101).
- Alternative 2: You must have connected a transportation service ID to (DRS030). It must be the same transportation ID that you have in (PPS101).
- Alternatives 3 and 4: You must have connected a transportation service ID to at least one of the functions mentioned above. Transportation service IDs are defined in (DRS025).
Connect a transportation service ID to a customer or warehouse
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Start 'Customer/Warehouse. Connect Tran Service' (DRS030). Specify the reference and identity.
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Open the E-panel and connect a transportation service ID (DRS025).