When Zones / Suburbs and Post Codes overlap in your rate cards it is time to be vigilant. Don’t expect that the carrier will provide the cheapest option as this is not the case.
Rate cards need to be carefully scrutinised to ensure that the rating rules are as agreed. Recently we identified situations where Zone, Post Codes and Suburb rates overlapped and the highest rates were applied. Normally you would expect that this would apply to locations that are difficult to access. There are good reasons for adding these rating lines, such as covering more difficult regions or high-volume towns within the zone.
Well, we are finding situations where the largest regional city has been covered by the postcode rate, and the rate is five times higher than the Zone rate.
It does not take very many of these transactions to create a large cost variance. In one situation, there were 10 regional locations covered by this scenario, with the overall impact just short of a five percent on the total freight bill.
We would suggest that if a mixture of zones, suburbs and postcodes are part of your rate structures that a flag is raised and it is worth investigating the reasons for this complexity.