Private Label & OEM2 min read

Allocating Freight Across Coating SKUs: Units, Weight or Value?

Allocate shared coating-shipment freight consistently using relevant cost drivers, and keep routine and exceptional transport costs visible.

Updated · NANOLAB Knowledge

A shared freight bill must be allocated before individual SKU costs can be compared. Allocation by unit count, weight or product value can produce different results. Choose a method that reflects the cost driver and document it consistently.

Match the method to the shipment

If one carton is bulky and another compact, equal cost per bottle may misrepresent transport demand. If the carrier prices by chargeable weight, physical or volumetric weight may be relevant. Insurance-related costs may follow value instead. Use the actual shipment basis where available.

In an illustrative shipment with 100 small bottles and 100 large kits, dividing freight equally per unit gives each the same share. A weight-based allocation may assign more to the kits. Neither should be selected merely to make a preferred SKU look more profitable.

Keep cost categories visible

Separate transport, packaging, handling and any other charges before allocating them. Some costs may belong directly to a specific SKU or destination rather than to the whole shipment. Use consistent tax and accounting treatment with the appropriate professional guidance.

Record the total bill and verify that all allocated shares add back to it. Rounding differences should be handled explicitly rather than leaving an unexplained remainder.

Review when the shipment mix changes

A rate based on a large mixed shipment may not describe a small urgent replenishment. Keep routine and exceptional freight separate in planning. Otherwise, a favourable historical average can hide the cost of repeated emergency orders.

For a coating brand, the purpose is a credible landed-cost comparison, not a perfect-looking spreadsheet. State the allocation basis beside the unit cost and test whether a reasonable alternative materially changes the SKU decision. If it does, improve the cost evidence before relying on the ranking.

Related guidance

Technical references: Australian Government: Margins and markups in pricing.

Discuss your product and packaging requirements through NANOLAB private-label development. For product-specific use, consult the current technical documentation.