Online freight rate quoting company, Freightos has estimated the cost of shipping the new iPhone 6s via air freight from China to the US would cost Apple US 72 cents per iPhone package. This includes local China trucking and distribution to retailers amounting to 17 cents, making the pure airfreight portion only 55 cents. Freightos undertook the exercise as a demonstration of its new private beta version of its online instant freight quote marketplace.
“From some rough calculations, we believe that Apple’s freight costs for supplying US iPhone 6s phones for first month sales will be about US 72 cents per iPhone package,” said Ethan Buchman, Freightos online freight evangelist. Buchman did caution however, that the combination of the fact that Apple’s supply chains are consistently rated the best in the world, together with how closely they hold information to their chest, it’s difficult to know for sure the precise cost of shipping.
According to Freightos’ calculations, a small business without the benefit of negotiated rates, or such vast capacity would have freight costs more like $1.82 per phone package. And if it were possible for an individual consumer to order directly from the factory, freight costs – more like express shipping costs – would be about $34.
Explaining its methodology, Freightos calculated the iPhone 6s shipping costs by estimating first month’s sales by looking at last year’s similar release, working out how many would be sold by looking at the number of units sold in the three months to February 2015 when the iPhone 6 was first released.
For how many iPhones a B747 can carry, Freightos used a logistics industry consultant’s estimate in a recent Bloomberg article and tweaked it, with Buchman saying, “we got a little fancy in applying a ratio to account for changes in packaged phone dimensions and weight.”
The number of aircraft shipments was then a simple calculation and freight costs were calculated using Freightos’ online quoting system, applying an estimated discount for Apple’s negotiated rates. The cost assuming a consumer could order direct from the factory was based on DHL’s parcel rate, or more correctly the discounted DHL parcel rate available on the company’s online quoting system.
“With the exception of using our freight rates, most of these calculations are rough estimates, with back-of -envelope calculations,” Buchman cautioned, adding: “Like many others, we love the way Apple has relentlessly innovated to bring compelling products to their customers, taking the complex and making it simple. Which, after all, is what we’re doing at Freightos, demystifying the freight industry by bringing it online.”
