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Shipping Carriers: Choosing the Best for Your Business

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Shipping Carriers Overview

If you are an eCommerce seller, you are probably familiar with the major US carriers—USPS, UPS and FedEx. They are responsible for the majority of parcel shipments within the US and millions of shipments internationally. While there are many other shipping services for last mile delivery and international consolidators for international shipments, the majority of eCommerce sellers will be dealing with the main three carriers.


Carrier Selection Criteria

  • Markets: domestic, international or both
  • Tracking: importance of trackable services
  • Weight: average package weight? Maximum? Minimum?
  • Package Dimensions: average package dimensions? Maximum? Minimum?
  • Dimensional Weight: will this apply given the above?
  • Insurance: average order value and extent to which included insurance will cover?
  • Signature: preference for signature confirmation and incremental cost applied
  • Ship to Address Type: Primarily residential or business addresses?
  • Surcharges: Some carriers apply a surcharge for residential delivery
  • Pickup preferences: What is the estimated pick up time, daily?
  • Pickup fees: Will a pick-up fee be applied to your monthly cost?
  • Software: does carrier integrate with popular software or provide their own?
  • Supplies: does the carrier provide free supplies relevant to the type of shipping you do?
  • Saturday delivery: to what extent is weekend delivery important?
  • Address Accuracy: Does the carrier charge for a non-deliverable package?

Shipping Carrier Selection

Carrier Selection on Shipping Environments

Selecting the right carrier for a given order can become complex; the variables to consider include the number of carriers you have accounts with, destination address, order service level, cost, package weight, and sometimes package dimensions. A good shipping platform can help ensure you rate-optimize this critical step in the process.

It is important to consider carriers in the context of all three environments you work in:

eCommerce Environments

Carriers on Selling Environment: align your customer facing options with carrier services you intend to use

  • Set up shipping rates and options for selected carriers

Carriers on Shipping Environment: group orders based on carrier selection criteria

  • Aggregate orders (if you use multiple selling platforms)
  • Organize orders based on shipping decision criteria, including:
    • Weight
    • Box dimensions
    • Age of order
    • Value of order
    • Number of items
    • Address type (residential vs commercial)
    • Requested service level
    • Other criteria relevant to your shipping process
  • Apply business and shipping rules to help automate selection of the optimal carrier.
  • Secure access to lower rates due to aggregate volume

Carriers on Physical Environment: organize shipments for each carrier pick up

  • Route package to the best carrier
  • Plan package pickup appropriately based on carrier policy

No matter which carrier you go with, you’ll eventually build a system and relationship with your carrier of choice, and their practices and process will ultimately affect your own. Choose the carrier that best matches your product mix and provides adequate service while not adding too much to your overall costs.

Related Articles & Resources:

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This article is from The Definitive Guide to eCommerce Shipping


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