In cost plus pricing programs, truck costs are determined based on the actual incurred cost once the shipment has been completed. In index-based pricing programs, truck costs are estimated based on market index for a given period at the time freight is tendered.
Guaranteed Primary truck costs are determined by algorithms that predict truck costs for a given period and time that freight is tendered. You know the rate upfront so there’s no need for billing reconciliation. Total rate is based on “predictive cost” plus margin, offering fair value for guaranteed capacity.