As per the name of the feature it will modify the rate based on various condition for the shopify shipping rate.
You can set multiple rate modifier with single rate.
Here is the various conditions. Using that you can increase or decrees the rate of the shipping.
Order based condition
i) Day Of Order
Delivery based condition
ii) X days from today
Product based condition
Customer based condition
i) Zip Code
Rate based condition
Once you choose the condition from the one of above.
You have to choose appropriate Operator like Equal, Does not equal, Greater than or equal, Less than or equal.
Set the Behaviour of this rate modifier cause you can set multiple rate modifier in the same rate.
Set the Modify Type like Fixed, Percentage, Remove Rate, Show Only
Finally set the Effect what you want with rate Increase or Decrease