Dimensional weight is used when packages are large in volume, but low in weight. You should calculate dimensional weight on every shipment, compare that to its actual weight; the greater of the two will determine your shipping cost.
Formula
Length x Width x Height (cubic inches) / 166 = Dimensional Weight.
Example
30" x 24" x 22" = 15,760 / 166 = 95 lbs
(round up to the nearest pound)