Through Rate

Tags: Glossary

A single rate charged for transportation from the point of origin to the final destination.

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What is Through Rate and How is it Calculated?

A through rate is a single freight rate that covers the transportation of goods from the point of origin to the final destination, including any transshipment points or intermediate stops along the way. Through rates are calculated based on a number of factors, including the weight or volume of the cargo, the distance traveled, and any additional services required. 

The calculation of a through rate can be complex and may involve negotiations between the shipper and carrier. The main factors that are typically considered in the calculation of a through rate include: 

  • Origin and destination: The distance between the point of origin and the final destination of the cargo is a key factor in determining the through rate. Generally, longer distances will result in higher rates due to increased transportation costs. 
  • Mode of transport: The mode of transport used to transport the cargo can also impact the through rate. For example, shipping by air is generally more expensive than shipping by sea or land, so air freight rates will be higher. 
  • Weight and volume of the cargo: The weight and volume of the cargo are also important factors in determining the through rate. Heavier and larger cargo will typically result in higher rates. 
  • Type of cargo: The type of cargo being shipped can also impact the through rate. Certain types of cargo may require specialized handling or equipment, which can increase transportation costs. 
  • Additional services: Any additional services required, such as customs clearance, insurance, or storage, may also be factored into the through rate. 

The through rate is typically negotiated between the shipper and carrier and is often based on a pricing model that takes into account the above factors. Some common pricing models include flat rates, weight-based rates, distance-based rates, or a combination of these factors. 

Related Glossary terms

Accessorial Charges

Advanced Charge

Chargeable Weight

Freight Charge

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