The accuracy in estimating truck class rates for logistical planning

Abstract

Truck class rates are usually needed in strategic logistical planning, especially for facility location. Using point-to-point transport rates is exact, but for practical reasons it is often necessary to estimate them from distance. Two sources of rate estimating error are examined: (a) the error resulting from the linear approximation of rates from distances; and, (b) the error associated with estimating distances from shipment origin-destination coordinate points. Suggestions are made as to how the rate estimating error may be minimized.