Cost Plus Rating

Important note: Cost Plus is not enabled by default. If you would like to enable this feature, reach out to your Turvo representative. If enabled, with every update to the carrier cost Turvo tries to re-calculate customer billables. An exception is raised if the system fails to rate.

Turvo supports direct rates on all orders and shipments and cost plus rates on orders and shipments with one order. 

Using direct rates, you can create contracts and define lane rates, service rates, and fuel plans. Using cost plus rates, you can configure markups for cost items like freight, fuel, and services.

How Cost plus Rating Works

Cost plus rate items are billable costs that are calculated as a markup over carrier costs. Markup profiles are configured at the customer-level and applied for total costs, the sum of all cost items - freight, fuel, accessorial. 

Note: Cost Plus does not work for cases where some cost items are rated as cost plus and others from direct rate types, or when markups are specific to cost type. For example, fuel is marked up by 10%, freight rated as $50 per pallet, and pass through services are present. 

You can set up customer, contract, lane, and service specific markups or direct rates for your customers and billables are calculated based on the markups.

When shipment is rated manually, the contract name is the markup profile name,  if there is no customer contract and the markups are configured at customer level. If there is no matching lane rate from the customer contract, the markup profile is used and the carrier is billed using the markup. 

If the shipment is rated via Autopilot, it considers cost plus rates and applies customer rates automatically. Autopilot creates an exception if it is unable to rate or has partial rates. Additionally, when a shipment is updated, like when a carrier is added to the shipment, if the Autopilot rule When a shipment is updated, the order is re-rated using cost plus. 

Add Markup Profiles in the Customer Account

To add Markup Profiles in the customer account, follow the steps below:

1. Navigate to the customer profile where you want to configure the cost markups and click the Details tab.
   
   
   
2. Click Settings.
   
   
   
3. Click Costs markups.
   
   
   
4. Click + Add markup profile.
   
   
   
5. Add the Markup profile name and select the Mode.
   
   
   Note: You can create multiple markup profiles but each mode can only be selected once across profiles.
   
   
6. Once the Mode is selected, the modal expands. Select the markups you’d like to apply. You can select markups on Freight, Fuel, and Service. You can select one or all of these and define the markups for each, if they are different.
   
   
   From here, you can fill out the Minimum and Maximum charges. You can select from three markup options:
   • % Markup over carrier costs
   • Amount markup over carrier costs
   • Pass through - 0%
     • Note: Pass through is a special case where the percentage markup is zero.
       
       
7. Click Save to save your markup.

Important Note: Contract rates override tenant-level settings.

Add Markup Profiles in Contracts

To add markup profiles in contracts, follow the steps below:

1. Navigate to the contract where you want to configure the cost markups and click the Details tab.
   
   
   
2. Click + Add markup profile.
   
   
   
3. Add the Markup profile name and select the Mode.
   
   
   Note: You can create multiple markup profiles but each mode can only be selected once across profiles.
   
4. Once the Mode is selected, the modal expands. Select the markups you’d like to apply. You can select markups on Freight, Fuel, and Service. You can select one or all of these and define the markups for each, if they are different.
   
   
   From here, you can fill out the Minimum and Maximum charges. You can select from three markup options:
   • % Markup over carrier costs
   • Amount markup over carrier costs
   • Pass through - 0%
     • Note: Pass through is a special case where the percentage markup is zero.
       
       
5. Click Save to save your markup.

Important Note: Contract rates override tenant-level settings.

Edit or Remove Cost Markup Profiles

1. To edit or remove a cost markup profile, click the three dot menu to the right and select either Edit or Remove.
   
   
   
2. When you select edit, the Edit markup profile modal opens.
   
   
   
3. Make your changes and click SAVE to save them.

Build Cost Plus Rate Type for Lane Rates

If you are not familiar with how to build lane rates, see our Add a lane rate to contracts or global rates article. 

1. In the contract or global rates profile, click Lane Rates.
   
   
   
2. Click + Add lane rate.
   
   
   
3. Turvo defaults to Regular costs but you can select Markup or Pass through (0%).
   
   
   Note: Cost plus is shown only for customer billable lane rates.
4. Click CREATE to save your changes.

Cost Markups on Shipments

In the event that there are rates at the lane rate or service rate level, those are prioritized over the contract or customer rates. Additionally, contract rates are prioritized over customer markup rates.  This is shown as follows: Lane/Service Rates > Contract Rates > Customer Rates.

Once markup profiles are configured, you see the marked up cost in Shipment > Costs. Hover over the Amount to see the markup.