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LTL Base & Master - Different Discounts For Base Costs - How to achieve this? (Doc ID 1461336.1)

Last updated on MARCH 12, 2021

Applies to:

Oracle Transportation Management - Version 6.2.3 to 6.2.3 [Release 6.2]
Information in this document applies to any platform.


Customer has a standard LTL Tariff which has the following type of structure:

Basic Charge: $30 per shipment (modelled as Base Cost)
Freight Charge: $1.00 per KG (modelled as Base Cost)
Minimum Charge: $40 (modelled as Rate Record Min Charge)
Fuel Charge: 12% Total Shipment Cost (modelled as Accessorial)

A 1KG shipment will be charged at $40 + FUEL because ($40 Minimum) is greater than ($30 Basic + (1 x $1 Freight) = $31)
An 11KG shipment will be charged at $41 + FUEL because ($30 Basic + (11 x $1 Freight) = $41) is greater than ($40 Minimum).

OTM handles that structure in the LTL Base with no problems.

However, when negotiating a Customer rate, it is expressed as discounts from the standard Tariff, thus:

Discount off Basic: 50%
Discount off Freight: 45%
Discount off Minimum: 40%
Discount off Fuel: 10%

In OTM’s Rate Cost Basis they have control of any specific accessorial Code that they want to discount (e.g. Fuel). However, they do not have control over the Base Cost components, nor the Min Charge – OTM allows for a blanket discount for all Base Costs, but no granularity for modelling different discounts for separate Base Costs. Consequently, they state that OTM does not distinctly identify the separate discounts on Per Kilo Charge vs. Basic Charge vs. Minimum Charge.

They have tried to push everything into accessorials, but then the weighing of "Minimum vs. Basic+Freight" is not considered (each Accessorial is calculated independently of the others).

Also, to honour their rate maintenance requirements, they need to keep the LTL-Master as percentage discounts rather than using cost amounts. So for example, if they change the Tariff Basic from $30 to $35 dollars, they should only have to update the LTL-Base rate, not the LTL-Master rates.

How to achieve this requirement?


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