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<ManualTopic ID="/baanerp/fm/onlinemanual/000026" xml:lang="en">
	<Header>
		<Title xmlns:ssa="http://www.ssaglobal.com" xmlns:HTML="http://www.w3.org/TR/REC-html40">Calculation of estimated freight costs</Title>
		<Keyword><Level1>freight costs</Level1>
		</Keyword>
		<Keyword><Level1>calculation</Level1>
		</Keyword>
		<Keyword><Level1>rates</Level1>
		</Keyword>
	</Header>
	<GeneralSection><Paragraph><GUIRef href="/baanerp/fm" role="package">Freight Management</GUIRef> calculates the estimated freight costs of loads and shipments during load building, or freight order clusters during freight order clustering. The <GUIRef href="/baanerp/fm" role="package">Freight Management</GUIRef> calculation engine is also used to calculate estimated freight costs for individual order lines of the following types:</Paragraph>
		<List><ListItem>Sales order lines</ListItem>
			<ListItem>Sales quotation lines</ListItem>
			<ListItem>Freight order lines</ListItem>
		</List>
		<Paragraph>For information on freight cost revenue calculation for individual order lines or quotation lines, refer to <Link href="/baanerp/fm/onlinemanual/000028" role="manual">Freight cost revenue calculation at order line entry</Link>. The current topic deals with estimated freight cost calculation during load building and freight order clustering.</Paragraph>
		<Paragraph>The calculation engine is automatically activated when the load building process or the freight order clustering process is carried out.</Paragraph>
		<Note><SectionTitle>Note</SectionTitle>
			<Paragraph>To enable freight cost calculation, you must select the <GUIRef href="/baanerp/fm/frc/fmfrc0100m000#fmfrc000.cost" role="formfield">Transport Costing</GUIRef> check box in the <GUIRef href="/baanerp/fm/frc/fmfrc0100m000" role="session">Freight Rates and Costs Parameters (fmfrc0100m000)</GUIRef> session.</Paragraph>
		</Note>
		<Paragraph>The calculation engine calculates the freight costs of the loads and shipments while they are created by the load building engine, or calculates the freight costs of the freight order clusters during the clustering process.</Paragraph>
		<Paragraph>To recalculate freight costs for loads, shipments, or clusters after the load building process or the clustering process is carried out, you can activate the calculation process in the <GUIRef href="/baanerp/fm/frc/fmfrc0240m000" role="session">Calculate Freight Costs (fmfrc0240m000)</GUIRef> session. Recalculation can be useful for various reasons, for example, after a recent change of the rates in the freight rate books. Before you activate the calculation process, you must select the plans, loads, shipments, or freight order clusters for which you want to calculate the estimated freight costs. The <GUIRef href="/baanerp/fm/frc/fmfrc0240m000" role="session">Calculate Freight Costs (fmfrc0240m000)</GUIRef> session is available on the <GUIRef href="" role="menu">Specific</GUIRef> menu of the relevant sessions. The calculation engine uses the carrier rates to determine the estimated freight costs.</Paragraph>
		<Paragraph>The calculation process includes the following steps:</Paragraph>
		<ProcedureList><ListItem>For loads and shipments, the calculation engine checks if rating must be based on shipments or loads. If rating must be based on shipments, the calculated costs of the shipments of a load are added to calculate the costs of a load. If rating must be based on loads, the costs of the load are divided by the shipments to arrive at the costs per shipment. For clusters, rating is based on clusters (the calculation engine sees that the rate basis is not shipment or load, and thus bases the rating on clusters). The estimated costs of the freight order cluster are divided over the individual freight order lines based on the setting of the <GUIRef href="" role="manual">Cost Allocation based on</GUIRef> field in the <GUIRef href="/baanerp/fm/frc/fmfrc0100m000" role="session">Freight Rates and Costs Parameters (fmfrc0100m000)</GUIRef> session.</ListItem>
			<ListItem>The calculation engine determines the <Link href="/baanerp/fm/glossary/glossary#000026" role="glossary">rate basis number</Link> for the shipment, load, or cluster. If the values defined for the rate basis number match those of the cluster, shipment, or load, the rate basis number is allocated to the cluster, shipment, or load.</ListItem>
			<ListItem>The rate basis number and several other shipment, load, or cluster attributes, such as carriers or service levels, are passed on to the <GUIRef href="/baanerp/td/pcg" role="module">Pricing Control</GUIRef> module of <GUIRef href="/baanerp/td" role="package">Order Management</GUIRef>. The <GUIRef href="/baanerp/td/pcg" role="module">Pricing Control</GUIRef> module uses this information to retrieve the appropriate carrier rate. For further information, see <Link href="/baanerp/td/onlinemanual/000087" role="manual">To update overall vendor rating</Link>.</ListItem>
			<ListItem>The costs are calculated with the rate retrieved from the <GUIRef href="/baanerp/td/pcg" role="module">Pricing Control</GUIRef> module, the travelling distance derived from the ship-from and ship-to addresses, and the total quantities of the goods to be transported.</ListItem>
		</ProcedureList>
	</GeneralSection>
	<RelatedTopics><SectionTitle>Related topics</SectionTitle>
		<RelTopic><Link href="/baanerp/fm/onlinemanual/000028" role="manual">Freight cost revenue calculation at order line entry</Link>
		</RelTopic>
		<RelTopic><Link href="/baanerp/td/onlinemanual/000384" role="manual">Freight rate retrieval</Link>
		</RelTopic>
		<RelTopic><Link href="/baanerp/fm/onlinemanual/000029" role="manual">The invoicing process</Link>
		</RelTopic>
		<RelTopic><Link href="/baanerp/fm/onlinemanual/000102" role="manual">Freight Management in multi-site environments</Link>
		</RelTopic>
	</RelatedTopics>
</ManualTopic>
