Table of Contents

Contracts

FMS Contracts can be used for Customer or Vendor contracts to register freight prices and surcharges that are agreed upon for a longer period of time. In the forwarding documents revenue and cost lines can be calculated based on contracts.

To create a new FMS contract

  1. Choose the Lightbulb that opens the Tell Me feature. icon that opens the Tell Me feature, enter FMS Contract, and then choose the related link.

  2. On the FMS Contracts page, Choose the New action.

  3. In the General FastPane specify the Source Type field with one of the available options: Customer, Customer Price Group, All Customers for Customer contracts, or Vendor, Vendor Price Group or All vendors for Vendor contracts.

    In the No. field select a record from the related table. Fill in the Valid-from date and Valid-to date fields to specify the contract validity. The dates will be copied to the Lines when new lines are created.

    Learn more about Contract strategy.

  4. Proceed to fill or change fields on the contract card as necessary. Hover over a field to read a short description.

    Tip

    Instead of creating a contract from scratch, you might want to:

    • Select an existing contract from the list and use the Copy action for simple modifications
    • Use the Contract contract via Journal action for more extensive modifications - this allows you to efficiently edit the lines using Excel.

  1. Now you are ready to add the contract lines. Fill the Description, Area Type and Area Code fields.

    Learn more about how to setup: Areas and how contract lines are prioritized based on the priority of the Area.

  2. The next step is the creation of detail lines in the Detail Lines FastPane. The Detail lines specify the rate information. Due to the large amount of scenario's which are supported, the detail line has many fields, the most commonly used fields are listed below:

    Tip

    When creating a new line in the contract use the the Detail card page, where you can find the most needed fields logically grouped in the FastPanes General, Price Settings and Calculation Settings.

    When creating large contracts you might want to copy detail line(s) from one line to the other.

    Think carefully where to implement surcharges. Surcharges might be implemented on the level of the contract, contract line and in some scenario's even in a separate contract.

    Field Remarks
    Service No. Select the Service No from the Service table.
    Service Description The Service Description field is automatically filled with the Description from the Service card, can be overwritten with a contract specific description when needed.
    Valid From/To Date It is recommended to fill the field: Valid-From-Date with the actual date te contract has started. The Valid-To-Date with a date in the distante future, for example: 31-12-9999.
    Quantity Calculation Calculation Method to calculate the quantity. Learn more about Quantity Calculations.
    Price per Quantity The calculated quantity will be divided by this value. The default value of this field is 1. Change the value to 1.000 to implement a price per ton.
    Base Amount The Base amount is used to calculate the unit price by dividing the Base Amount with the calculated Quantity. This field should only be filled when needed.
    Min. Amount Fill this field to implement a minimum Line Amount on the resulting Cost or Revenue line. ,
    Max. Amount Fill this field to implement a maximum Line Amount on the resulting Cost or Revenue line.
    Unit Price The Unit Price is the most commonly used field. Unit Price might be used in combination with Base Amount, Min. and/or Max. Amount.
    Unit Price Calculation Calculation method to calculate the Unit Price. Unit price calculations are typically used when a surcharge needs to be calculated based on specific services provided in the Shipment.
Note

Optionally you can implement graduated pricing. The field Sub Prices Available on the Detail lines page show if Sub prices are available. To add the graduated prices choose the value and insert the prices on the Contract Lines Page, or open the Detail Line Card page and go to the Lines FastPane.

Contract Copy Wizard

Use the contract copy workflow to prepare a new contract from an existing agreement. This saves re-entering the line structure when renewing a contract or preparing similar rates for another customer or vendor.

Start with the Copy action on the contract and review the destination, validity dates and the information selected for copying. Check the copied prices, surcharges and customer/vendor scope before making the new contract available for calculation. For larger changes, use Contract Journals.

Contract and Discount Management

General contracts can provide common rates while customer-specific discounts define exceptions. This avoids maintaining a complete duplicate contract for every customer.

Use the Contract Journal (Discounts) to collect the relevant contract details, enter the new discount percentage and implement the changes. Review the contract's source scope and dates and test a matching customer calculation before applying the same arrangement more widely.

Calculation conditions and pricing exceptions

Sometimes a shipment needs different rating behavior without changing the contract for every customer or movement. Calculation Conditions record these exceptions against the document, a cargo line or a document contract strategy line.

For example, cargo may still be handled as LCL while a different movement type is required for invoicing. A calculation condition can supply the invoicing movement type without changing the underlying operational movement type.

The supported conditions include:

  • Header Field Override for the document's invoicing movement type code.
  • Line Field Override for the cargo line's invoicing movement type.
  • Force Calculation Type for the required calculation behavior, optionally scoped to a service and cost/revenue type.
  • Discount Percentage Override linked to a document contract strategy line.
  • Invoice Currency for the applicable calculation context.

On a shipment, choose Calculation Conditions to review the exceptions for the document and its related records. Conditions are associated with a specific record and type; the available fields and editing options depend on that context. They are not unrestricted rules for replacing arbitrary fields.

Configuration hints

Start with the standard contract and Document Contract Strategy. Apply an exception only where the normal setup should not be used, then recalculate the affected charges and inspect the outcome. A saved condition alone is not proof that an existing charge has been recalculated.

Use the context-specific fields to create the exception. For example, Invoicing Movement Type on the cargo line card records a line override, while Forced Calculation Type on the shipment revenue line card records a service-specific calculation condition. Review the resulting record through Calculation Conditions; this list is not a general New entry point for conditions.

Tip

Before changing a general contract to solve one shipment's pricing issue, check for existing calculation conditions. Test that the exception applies only to the intended document, line or service.

Trace calculated charges with Contract Sources

The Contract Sources factbox explains where a calculated shipment revenue line obtained its pricing. Use it when a price differs from expectations, a minimum amount was applied, or a discount needs to be checked.

Open the shipment revenue line card and review:

  • Agreement Detail Line: the main contract rate used for the line.
  • Min. Amount Detail Line: the contract detail that supplied the minimum amount.
  • Contract Discount Line: the discount applied to the line.

Choose a populated value to open the related contract rate or discount. Not every charge has all three sources: a manually entered line or a calculation without a separate minimum or discount may have no corresponding source to open.

No separate source-tracing setup is required. Configure the contracts and discounts used by the calculation, calculate the revenue line, and inspect the resulting sources before changing prices. The factbox shows linked source records, not a full historical snapshot of every previous calculation.

For processing progress, see Background calculation and document processing.

For fuel-related surcharges, see Fuel Clauses.

Chargeable weight and Load meters

In the shipping industry, chargeable weight refers to the weight used to calculate the cost of transporting goods. It is the higher of the actual weight or the volumetric weight of the shipment. The purpose of chargeable weight is to account for the space occupied by the cargo. For example, a shipment of 1.000 kg of feathers has a larger volume than 1.000 kg of lead.

Tarriff factors

Tarriff factors have been agreed upon within the transportation industry, or are mutual agreed between the freight forwarder and the vendor or customer. On a shipment, the Chargeable Weight field will be the filled with the Gross Weight or the Volumetric weight. The highest weight is charged.

Note

The Tarriff Factor can be setup on different entities: Contract (Detail Line/Line/Header), Carrier or Customer, Mode Of Transport and Forwarding Setup. The tariff factor is determined in the sequence of the above-mentioned entities. The system will use the tariff factor specified at the most specific level to calculate the chargeable weight. For example, if a tariff factor is set at the contract detail line level, it will take precedence over the tariff factor set at the carrier or customer level. Similarly, if a tariff factor is set at the mode of transport level, it will override the tariff factor set at the forwarding setup level.

Keep in mind that the highest weight between the gross weight and the volumetric weight will be charged as the chargeable weight. The system will automatically calculate the chargeable weight based on the specified tariff factor and the weight of the shipment.

Different Modes of Transport and Chargeable Weight:

  1. Road Transport: In road transport, chargeable weight is often calculated based on load meters with a factor >of 1750 kg per load meter. Load meters represent the linear meters of cargo space in a truck. The system can calculate >the load meters with a standard load meter factor of 2.4, but it can also be based on the load meter factor specified on >the order type card. For example, a euro pallet (80x120cm) may be considered as 0.4 load meters, while a block pallet >(100x120cm) may be considered as 0.5 load meters.

  2. Air Transport: In air transport, chargeable weight is typically based volumetric weight with a factor of >167 kg per m3.

  3. Ocean Transport: In ocean transport, chargeable weight is typically based volumetric weight with a factor >of 1000 kg per m3. Chargeable weight calculations are typically used for less than container loads (LCL).

Note

Please note some of the fields on the service card are mandatory when posting a Sales or Purchase invoice, such as the Gen. Prod. Posting Group and Vat Prod, Posting group.

Adjust prices

For adjusting prices a wizard is available on the contract card to assist adjusting prices.

Learn More

In Boltrics Academy we provide you with this e-learning

Demurrage and Detention Calculation

Demurrage and detention charges are fees applied when containers or equipment are held beyond the allowed free time period. These charges can be calculated and managed through contracts. For detailed information on setting up and managing demurrage and detention, see Demurrage and Detention.

See also

Areas and Regions
Forwarding services
Quantity calculations
Demurrage and Detention

Edit this page