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“Ratemaking in Practice” Part Two
Marketing Logistics
Example
Cole, Bardi, Novack (2000) Transportation
Example
• Move 11,000 pounds of plastic sheets exceeding 9 feet, 6 inches from Cross Village, Michigan, to Clifford, Ohio.
Cole, Bardi, Novack (2000) Transportation
Example
• Move 11,000 pounds of plastic sheets exceeding 9 feet, 6 inches form Cross Village, Michigan, to Clifford, Ohio.
• Determine rate basis point.
Cole, Bardi, Novack (2000) Transportation
Example
• Move 11,000 pounds of plastic sheets exceeding 9 feet, 6 inches form Cross Village, Michigan, to Clifford, Ohio.
• Determine rate basis point.– Cross Village rate basis point = Cheboygan,
Michigan.
Cole, Bardi, Novack (2000) Transportation
Shipping to and fromCross Village, Michigan
Shipping to and fromCross Village, Michigan--it is in the CheboyganRate base area.
Example
• Move 11,000 pounds of plastic sheets exceeding 9 feet, 6 inches form Cross Village, Michigan, to Clifford, Ohio.
• Determine rate basis point.– Cross Village rate basis point = Cheboygan,
Michigan.
Cole, Bardi, Novack (2000) Transportation
Example
• Move 11,000 pounds of plastic sheets exceeding 9 feet, 6 inches form Cross Village, Michigan, to Clifford, Ohio.
• Determine rate basis point.– Cross Village rate basis point = Cheboygan,
Michigan.– Clifford rate basis point is Chillicothe.
Cole, Bardi, Novack (2000) Transportation
Example
• Move 11,000 pounds of plastic sheets exceeding 9 feet, 6 inches form Cross Village, Michigan, to Clifford, Ohio.
• Determine rate basis point.– Cross Village rate basis point = Cheboygan,
Michigan.– Clifford rate basis point is Chillicothe.
• Determine rate basis numbers tariff.
Cole, Bardi, Novack (2000) Transportation
Rate Basis Numbers
Chillicothe Cincinnati Columbus Dayton
Cheyboygan 550 570 490 510
Clare 400 420 360 380
Flint 275 300 227 214
Cole, Bardi, Novack (2000) Transportation
Rate Basis Numbers
Chillicothe Cincinnati Columbus Dayton
Cheyboygan 550 570 490 510
Clare 400 420 360 380
Flint 275 300 227 214
Cole, Bardi, Novack (2000) Transportation
Rate Basis Numbers
Chillicothe Cincinnati Columbus Dayton
Cheyboygan 550 570 490 510
Clare 400 420 360 380
Flint 275 300 227 214
Cole, Bardi, Novack (2000) Transportation
Example
• Move 11,000 pounds of plastic sheets exceeding 9 feet, 6 inches from Cross Village, Michigan, to Clifford, Ohio.
• Determine rate basis point.– Cross Village rate basis point = Cheboygan,
Michigan.– Clifford rate basis point is Chillicothe.
• Determine rate basis numbers tariff.
Cole, Bardi, Novack (2000) Transportation
Example
• Move 11,000 pounds of plastic sheets exceeding 9 feet, 6 inches from Cross Village, Michigan, to Clifford, Ohio.
• Determine rate basis point.– Cross Village rate basis point = Cheboygan,
Michigan.– Clifford rate basis point is Chillicothe.
• Determine rate basis numbers tariff.• Determine class rating.
Cole, Bardi, Novack (2000) Transportation
• Plastic material.– Sub 1 Exceeding 9 feet, 6 inches in two dimensions
or 20 feet in one dimension.• LTL – 85• TL – 45• MW - 30
– Sub 2 Not exceeding 9 feet, 6 inches in more than one dimension nor 20 feet in one dimension.
• LTL – 60• TL – 35• MW - 30
Page 331 Cole, Bardi, Novack (2000) Transportation
• Plastic material.– Sub 1 Exceeding 9 feet, 6 inches in two
dimensions or 20 feet in one dimension.• LTL – 85• TL – 45• MW - 30
– Sub 2 Not exceeding 9 feet, 6 inches in more than one dimension nor 20 feet in one dimension.
• LTL – 60• TL – 35• MW - 30
Page 331 Cole, Bardi, Novack (2000) Transportation
• Plastic material.– Sub 1 Exceeding 9 feet, 6 inches in two
dimensions or 20 feet in one dimension.• LTL – 85• TL – 45• MW - 30
– Sub 2 Not exceeding 9 feet, 6 inches in more than one dimension nor 20 feet in one dimension.
• LTL – 60• TL – 35• MW - 30
Page 331 Cole, Bardi, Novack (2000) Transportation
Rate Basis Numbers
Chillicothe Cincinnati Columbus Dayton
Cheyboygan 550 570 490 510
Clare 400 420 360 380
Flint 275 300 227 214
Cole, Bardi, Novack (2000) Transportation
Rate Basis Numbers
Chillicothe Cincinnati Columbus Dayton
Cheyboygan 550 570 490 510
Clare 400 420 360 380
Flint 275 300 227 214
Cole, Bardi, Novack (2000) Transportation
Rate Basis Number 501-550
Weight Class 200
Class 100
Class 85
M5C 3775 1824 1633
M1M 2900 1401 1264
M2M 2488 1202 1092
M5M 2035 983 888
M10M 1933 934 846
M20M 1459 705 640
M30M 1292 624 572Cole, Bardi, Novack (2000) Transportation
Rate Basis Number 501-550
Weight Class 200
Class 100
Class 85
M5C 3775 1824 1633
M1M 2900 1401 1264
M2M 2488 1202 1092
M5M 2035 983 888
M10M 1933 934 846
M20M 1459 705 640
M30M 1292 624 572Cole, Bardi, Novack (2000) Transportation
Rate Basis Number 501-550
Weight Class 200
Class 100
Class 85
M5C 3775 1824 1633
M1M 2900 1401 1264
M2M 2488 1202 1092
M5M 2035 983 888
M10M 1933 934 846
M20M 1459 705 640
M30M 1292 624 572Cole, Bardi, Novack (2000) Transportation
Rate Basis Number 501-550
Weight Class 200
Class 100
Class 85
M5C 3775 1824 1633
M1M 2900 1401 1264
M2M 2488 1202 1092
M5M 2035 983 888
M10M 1933 934 846
M20M 1459 705 640
M30M 1292 624 572Cole, Bardi, Novack (2000) Transportation
More than 500 pounds
Rate Basis Number 501-550
Weight Class 200
Class 100
Class 85
M5C 3775 1824 1633
M1M 2900 1401 1264
M2M 2488 1202 1092
M5M 2035 983 888
M10M 1933 934 846
M20M 1459 705 640
M30M 1292 624 572Cole, Bardi, Novack (2000) Transportation
More than 1,000 pounds
Rate Basis Number 501-550
Weight Class 200
Class 100
Class 85
M5C 3775 1824 1633
M1M 2900 1401 1264
M2M 2488 1202 1092
M5M 2035 983 888
M10M 1933 934 846
M20M 1459 705 640
M30M 1292 624 572Cole, Bardi, Novack (2000) Transportation
More than 2,000 pounds
Rate Basis Number 501-550
Weight Class 200
Class 100
Class 85
M5C 3775 1824 1633
M1M 2900 1401 1264
M2M 2488 1202 1092
M5M 2035 983 888
M10M 1933 934 846
M20M 1459 705 640
M30M 1292 624 572Cole, Bardi, Novack (2000) Transportation
More than 5,000 pounds
Rate Basis Number 501-550
Weight Class 200
Class 100
Class 85
M5C 3775 1824 1633
M1M 2900 1401 1264
M2M 2488 1202 1092
M5M 2035 983 888
M10M 1933 934 846
M20M 1459 705 640
M30M 1292 624 572Cole, Bardi, Novack (2000) Transportation
More than 10,000 pounds
Rate Basis Number 501-550
Weight Class 200
Class 100
Class 85
M5C 3775 1824 1633
M1M 2900 1401 1264
M2M 2488 1202 1092
M5M 2035 983 888
M10M 1933 934 846
M20M 1459 705 640
M30M 1292 624 572Cole, Bardi, Novack (2000) Transportation
More than 20,000 pounds
Rate Basis Number 501-550
Weight Class 200
Class 100
Class 85
M5C 3775 1824 1633
M1M 2900 1401 1264
M2M 2488 1202 1092
M5M 2035 983 888
M10M 1933 934 846
M20M 1459 705 640
M30M 1292 624 572Cole, Bardi, Novack (2000) Transportation
More than 30,000 pounds
Example
• Move 11,000 pounds of plastic sheets exceeding 9 feet, 6 inches from Cross Village, Michigan, to Clifford, Ohio.
Cole, Bardi, Novack (2000) Transportation
Example
• Move 11,000 pounds of plastic sheets exceeding 9 feet, 6 inches from Cross Village, Michigan, to Clifford, Ohio.
Cole, Bardi, Novack (2000) Transportation
Rate Basis Number 501-550
Weight Class 200
Class 100
Class 85
M5C 3775 1824 1633
M1M 2900 1401 1264
M2M 2488 1202 1092
M5M 2035 983 888
M10M 1933 934 846
M20M 1459 705 640
M30M 1292 624 572
Minimum 10,000 pounds
Cole, Bardi, Novack (2000) Transportation
• Plastic material.– Sub 1 Exceeding 9 feet, 6 inches in two dimensions
or 20 feet in one dimension.• LTL – 85• TL – 45• MW - 30
– Sub 2 Not exceeding 9 feet, 6 inches in more than one dimension nor 20 feet in one dimension.
• LTL – 60• TL – 35• MW - 30
Page 331 Cole, Bardi, Novack (2000) Transportation
• Plastic material.– Sub 1 Exceeding 9 feet, 6 inches in two dimensions
or 20 feet in one dimension.• LTL – 85• TL – 45• MW - 30
– Sub 2 Not exceeding 9 feet, 6 inches in more than one dimension nor 20 feet in one dimension.
• LTL – 60• TL – 35• MW - 30
Page 331 Cole, Bardi, Novack (2000) Transportation
Rate Basis Number 501-550
Weight Class 200
Class 100
Class 85
M5C 3775 1824 1633
M1M 2900 1401 1264
M2M 2488 1202 1092
M5M 2035 983 888
M10M 1933 934 846M20M 1459 705 640
M30M 1292 624 572
Minimum 10,000 pounds
Cole, Bardi, Novack (2000) Transportation
Rate Basis Number 501-550
Weight Class 200
Class 100
Class 85
M5C 3775 1824 1633
M1M 2900 1401 1264
M2M 2488 1202 1092
M5M 2035 983 888
M10M 1933 934 846M20M 1459 705 640
M30M 1292 624 572
Minimum 10,000 pounds
Cole, Bardi, Novack (2000) Transportation
Rate Basis Number 501-550
Weight Class 200
Class 100
Class 85
M5C 3775 1824 1633
M1M 2900 1401 1264
M2M 2488 1202 1092
M5M 2035 983 888
M10M 1933 934 846M20M 1459 705 640
M30M 1292 624 572
846 cents/cwt
Cole, Bardi, Novack (2000) Transportation
Example
• Move 11,000 pounds of plastic sheets exceeding 9 feet, 6 inches from Cross Village, Michigan, to Clifford, Ohio.
Cole, Bardi, Novack (2000) Transportation
Example
• Move 11,000 pounds of plastic sheets exceeding 9 feet, 6 inches from Cross Village, Michigan, to Clifford, Ohio.
Cole, Bardi, Novack (2000) Transportation
Example
• Move 11,0 pounds of plastic sheets exceeding 9 feet, 6 inches from Cross Village, Michigan, to Clifford, Ohio.
Cole, Bardi, Novack (2000) Transportation
Example
• Move 11,0 pounds of plastic sheets exceeding 9 feet, 6 inches from Cross Village, Michigan, to Clifford, Ohio.
Cole, Bardi, Novack (2000) Transportation
110 cwt
Rate Basis Number 501-550
Weight Class 200
Class 100
Class 85
M5C 3775 1824 1633
M1M 2900 1401 1264
M2M 2488 1202 1092
M5M 2035 983 888
M10M 1933 934 846M20M 1459 705 640
M30M 1292 624 572
846 cents/cwt$8.46 x 110cwt
Cole, Bardi, Novack (2000) Transportation
Rate Basis Number 501-550
Weight Class 200
Class 100
Class 85
M5C 3775 1824 1633
M1M 2900 1401 1264
M2M 2488 1202 1092
M5M 2035 983 888
M10M 1933 934 846M20M 1459 705 640
M30M 1292 624 572
846 cents/cwt$8.46 x 110cwt= $930.60
Cole, Bardi, Novack (2000) Transportation
End of Program.