Deep-dive guide
Container Empty Space Loss Simulator: What Unused Cubic Metres and Air Top-Ups Cost
Executive industry analysis
Ocean freight is sold by the box, not by the cubic metre. A container that leaves at 60 percent full costs exactly what a full one costs, so the price of each cubic metre you actually ship rises as the fill rate falls. Importers feel this as a vague pressure on margin, but it can be calculated: divide the freight by the volume really loaded and compare it with the margin earned on that volume. At low fill the result is often a surprise, because the freight per used cubic metre can approach the margin on the goods themselves.
Empty space is rarely chosen. It comes from purchase orders that do not fit together, suppliers with different cut-off dates, fragile or oddly shaped cartons, and the habit of releasing a sailing to keep a promise. Each of these is reasonable alone. Together they create a stream of boxes that carry air, and the cost does not show up as a line in the accounts. It is spread across the freight invoice and the landed cost of every product.
The domino model follows the cost through the chain. Fill rate sets the cost per loaded cubic metre, which sets the money paid for unused volume, which decides what share of gross margin shipping consumes, which finally decides profit. A second path runs through air freight. When a container misses a date, part of the goods goes by air at a rate several times the sea cost, so a low fill rate and a high air share tend to arrive together.
The iceberg separates the freight invoice from the full cost of a shipment. Above the waterline sit the sea freight and the port and trucking charges. Below it sit the air freight premium, the cost of money tied up while goods are at sea or waiting, demurrage and detention, and cargo insurance. These are paid by different people and appear in different reports, so nobody sees the total. Use the simulator to find the fill rate at which your programme stops earning.
Formula and methodology blueprint
The model works on one month of 40-foot containers with 67 cubic metres of usable space. Sea volume is containers times 67 times the fill rate. Air cargo is the share of all shipped volume that skipped the container, so total volume is sea volume divided by one minus the air share. Margin is total volume times margin per cubic metre. Costs are full freight on every box, handling, air freight on the air volume, cost of money in transit, detention and insurance.
- Sea volume
- V = containers × 67 × fill
- The cubic metres that actually travel by sea.
- Total volume
- T = V ÷ (1 − air share)
- All shipped volume including the part that went by air to save a date.
- Cost per loaded m³
- C = (freight × boxes + handling) ÷ V
- What each cubic metre of real cargo carries in sea freight and port cost.
- Empty space cost
- E = freight × boxes × (1 − fill)
- The part of the freight bill paid for volume that carried nothing.
- Net profit
- Net = T × margin − freight − handling − air − capital − detention − insurance
- The monthly result after every shipping cost.
- Air premium
- A = T × air share × air rate
- The cost of moving rush cargo by air instead of waiting for the next box.
Cascading elasticity
Freight per box and the fill rate are the most elastic inputs because they set the cost of every loaded cubic metre: a ten point fall in fill raises the sea cost per cubic metre by roughly a tenth of its value. The air share is the sharpest lever when air costs several times the margin, because each point of rush cargo loses more than it earns. Margin per cubic metre sets the threshold that all shipping costs must stay under.
Three real-world case studies
Bootstrapped starter
Two boxes a month from a small supplier
A small importer brings in two containers a month, loads them to about seventy percent and uses air only occasionally. Freight is average and the goods carry a good margin, so the month is positive but a single half-empty box would hurt. Loading it shows how a young programme has little cushion for empty space.
Scaling mid-market
Eighteen boxes a month with tight planning
A larger importer ships eighteen containers monthly, plans orders so boxes leave nearly full and keeps air shipments rare. The per-cubic-metre cost is low and volume turns that into a large profit. Loading it shows how fill discipline pays more as the programme grows.
Black-swan crisis
A freight spike and half-empty boxes
Freight rates jump, orders arrive in small lots so boxes sail forty percent full, and one in five cubic metres is rushed by air at a high rate. Margins on the goods are squeezed at the same time. Loading it shows the month falling deep into loss and which lever repairs it first.
Industry benchmark matrix
| Metric | Danger zone | Industry average | Top 10% elite |
|---|---|---|---|
| Container fill rate (by volume) | Below 60% | 75–88% | Above 92% |
| Empty-space cost as share of freight bill | Above 35% | 12–25% | Below 8% |
| Air freight as share of shipped volume | Above 15% | 3–8% | Below 2% |
| Logistics cost as share of gross margin | Above 90% | 50–70% | Below 45% |
| Demurrage and detention per box | Above 8% of freight | 2–4% | Close to zero |
Variables and levers
Containers per month
Number of 40-foot containers shipped each month, each holding about 67 cubic metres of usable space.
Lever: Group purchase orders into fewer, fuller sailings, since every extra box that sails half-empty adds its full freight.
Container fill rate
Share of each container's usable volume actually loaded; the rest is paid for but carries nothing.
Lever: Consolidate suppliers, repack cartons for density and delay a sailing by a few days rather than ship a box that is only half loaded.
Sea freight per container
All-in ocean freight price per box, including surcharges, which is charged in full however empty the box is.
Lever: Tender your lanes with several forwarders and ask about contract rates, because a small change per box is multiplied by every sailing.
Gross margin per cubic metre
Margin earned on the goods that fill one cubic metre, before any freight or logistics cost.
Lever: Prioritise high-margin lines when space is tight, and reprice bulky low-margin goods whose freight per cubic metre eats the sale.
Share of volume sent by air
Part of all shipped volume that missed the container and went by air to protect a delivery date.
Lever: Hold safety stock on fast sellers and plan production earlier, so fewer shipments need air to meet a date.
Air freight per cubic metre
Cost of moving one cubic metre by air, usually much higher than the margin earned on the same goods.
Lever: Ship only the urgent part by air and compare express with partial sea consolidation before you accept the quoted rate.
How to use this simulator
- 1Enter the number of containers and the average fill rate from your loading reports.
- 2Set the all-in sea freight per box and the margin you earn per cubic metre of goods.
- 3Add the share of volume you send by air and the air rate you pay.
- 4Read the five domino boxes, then press Find my breaking point to see the fill rate that erases profit.
- 5Compare with the consolidation plan over 24 months in the Parallel universe tab.
Mistakes to avoid
- Averaging fill rate across the year. A few very empty boxes hide inside a good average and each one still costs the full freight.
- Comparing freight per box instead of per loaded cubic metre. A cheaper box that sails half empty is the more expensive one.
- Treating air as a rare exception. Air shipments often repeat every month and cost several times the margin on the cargo.
- Leaving out the cost of money in transit. Goods at sea are paid for but not yet sold, and that delay has a price.
Frequently asked questions
Is weight or volume the limit for a container?
It depends on the goods. Light, bulky goods fill the volume first and heavy goods hit the weight limit. This model assumes volume is the limit, so use it for the volume-bound part of your range.
Why is air freight counted as a cost per cubic metre?
Air is usually priced by chargeable weight, which blends weight and volume. The model uses a rate per cubic metre as a simple equivalent, so enter the cost you actually pay for one cubic metre of your goods.
Is it better to ship a half-empty box or wait?
Often waiting wins, because the empty half is paid in full. But waiting delays cash and can miss a sales window, so compare the freight saved with the cost of delay.
What is the difference between detention and demurrage?
Demurrage is charged by the carrier or terminal when a container stays too long at the port, and detention when it stays too long outside. Both depend on contract terms, so check yours.
How do I find my breaking fill rate?
Press Find my breaking point. The tool pushes each input towards its worse end and reports the value at which monthly profit reaches zero, ranked by how close each lever is.
How accurate is this?
It is an educational model with simplified costs, not a quote or logistics advice. Replace the inputs with figures from your forwarder invoices and check them against real shipments.
This is an educational planning model with stated assumptions. It is not financial, tax or legal advice. Replace the inputs with your own figures and verify important decisions with a qualified professional.