Shipping Rates Comparison Made Easy

Is your company relying on a single carrier and its shipping rates to handle the bulk of your parcel shipping volume? If so, are you sure your company is receiving the best possible freight rates from that carrier?

Using a single carrier is easy and convenient, but it doesn’t always yield the best deal financially. Low-weight and/or short-zone packages can hurt your carrier discount as these parcels pull down your averages (average weight, average zone, and average carrier revenue per package).

One of the best ways to ensure you have the best shipping rates is to identify other carriers who can service the same delivery requirements and compare their rates with your primary carrier’s rates.

When conducting a shipping rates comparison, there are a few factors to keep in mind, including base shipping rates, weight breaks, surcharges, and shipping zones. Here are a few ways to compare shipping costs.

Ways to Compare Shipping Rates

Manual Comparison

One of the simplest but most process-intensive ways to conduct a carrier shipping rate comparison is to export a list of shipments with their weights and destination postal codes from your order management system and compare your actual shipping charges with other carriers’ shipping charges. Using at least one month of data is best to get a realistic picture of costs. You can either run the data through a program or manually look up the rates and compare your shipping costs to other carrier rates.

For example, if you ship only via UPS, you can use your UPS invoice and compare it to the rates of FedEx to determine which carrier would best match your shipping needs. However, this type of manual comparison can be very tedious and time-consuming.

Analytical Tools

You can also compare shipping costs by using proprietary analytical tools available in some parcel shipping software solutions. For example, InfoShip®/Vx, CLS’ enterprise multi-carrier shipping system, offers an analytical tool that compares carrier rates with USPS rates.

If your company ships small parcels, especially shipments under four pounds, the US Postal Service (USPS) will often be the carrier that offers the lowest shipping rate. To determine if this is the case, you can upload historical shipping data into the InfoShip®/Vx parcel shipping software system to automatically compare your current carrier charges with USPS shipping rates for the same period.

Carrier Assistance

You can also contact the carriers and ask for their help in conducting a shipping cost comparison. In addition to providing their shipping rates, they may also offer you an incentive-based rating discount program based on your shipping volume.

This is also the quickest way to compare shipping costs across multiple carriers; however, it will require you to share your shipping data with the carrier.

Discount Comparison

Even if your company already receives a discount with your primary carrier, it is worth comparing multiple carrier rates based on your shipment destinations for “what if” analysis. For example:

• Are you receiving better shipping rates from one carrier over another based on certain shipment weight breaks and zone destinations?
• Which carrier will offer better overall discounts such as a larger discount on the bulk of your shipping?

For example, if 60% of your shipments are delivered in Zones 1-3 and weigh less than five pounds, you can use this data to quickly compare the cost-effectiveness of delivering the bulk of these shipments via different carriers such as USPS, UPS, FedEx, and other regional carriers.

Using this data, you can focus on getting deeper carrier discounts for these specific zones and weights where the bulk of your shipments are delivered.

Key Considerations

Below are some factors to keep in mind when considering your internal shipping costs and performing a shipping cost comparison.

Packing Material

If you’re looking to reduce shipping costs from a global standpoint, consider your packing materials. Use lightweight packing material, such as bubble wrap, paper, or popcorn, to avoid adding unnecessary weight to the product you are shipping.

Be conscious of the box’s weight when you include promotional materials, as these marketing materials can add extra weight to your shipment.

Another consideration, if your company sells soft products such as apparel, linens, or household textiles, is that it may be more cost-effective to ship orders in poly bags. Many companies even ship products like shoes in poly bags rather than boxes.The packed poly bagwill often measure out a lower dimensional freight rate, while costing less and taking up less storage space than boxes.

Shipment Dimensions

If your company ships orders in various box sizes, consider using cartonization software to analyze order size and automatically choose the smallest possible box to ship the order. This will prevent the use of larger-than-necessary boxes, which require excess void fill and result in higher freight rates due to larger dimensional weight.

CLS Cuts Shipping Costs

Creative Logistics Solutions can help to streamline the shipping process for you. Contact us to learn more about our InfoShip/Vx multi-carrier software for shipping, and its extensive Carrier Library.

Learn More

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Cost and Service Reasons to Consider Alternative Carriers for Your Delivery Network