A mileage rate is a charge assessed by a logistics company based on the number of miles the commodity is shipped. This rate can vary depending on the mode of transportation used (e.g. ground, air, etc.), and is generally calculated using GPS data to determine the distance traveled.
A Mileage Rate includes a base rate, which reflects the cost to move the commodity one mile, and a fuel surcharge, which is a percentage of the total shipment cost that covers the price of fuel.
- For example, if a shipper has a Mileage Rate of $2.00 per mile and ships a load of 500 miles, the total shipping charges would be $1,000 ($2.00 x 500 miles).
- If the fuel surcharge is 20%, the total cost of the shipment would be $1,200 ($1,000 + $200 fuel surcharge).
Mileage rates are just one type of pricing structure that logistics companies may use, and your shipper should work with you to determine the best option for your particular needs.