How to Avoid Overspending on Package Shipping Rates

by | Apr 10, 2020 | Order Fulfillment, Suppliers

Cash flow is the lifeblood of small businesses. Optimizing shipping costs can help businesses preserve cash, which is more important now than ever.

Compare shipping rates for drop-ship fulfillment

For companies that drop-ship, the ability to reduce package shipping rates is essential. That’s because the cost to ship a product is often greater than the cost of the materials needed to create it.

Save time and money with Carrier Service rate shopping

For example, the cost of materials to produce a t-shirt are generally around $1.00 and the shipping costs are $1.20 (20 percent greater than the materials cost).

As experienced shippers know, package shipping rates can vary widely between carriers. Here are three ground shipping rates for a typical shoebox:

Carrier 1: $19.42
Carrier 2: $15.10
Carrier 3: $11.19
Cost difference between the most and least expensive carrier: 73%

 

Finding the most cost-effective shipping rates can yield significant savings, particularly for suppliers that are drop-shipping hundreds of packages each week. On this package, the savings are $8.23. The average drop-shipper fulfills 500 orders per month and could save over $4,000 per month using this type of rate shopping.

Easily find the most cost-effective package shipping rate

Without an automated way to compare shipping rates, you’d have to visit multiple carrier websites or on-line shipping calculators to research costs. This includes typing in package dimensions and shipping timeframes for each package. For a company fulfilling dozens, hundreds or even thousands of orders a week, rate shopping can be extremely time-consuming.

That’s where Fulfillment with Carrier Service from SPS Commerce comes in. Carrier Service loads rates from your favorite carriers and allows you to quickly compare them — without leaving your Fulfillment solution. Plus, you can complete your advance ship notice, book your shipment and print your label within the same workflow.

Carrier Service helps you find the lowest rates from multiple providers including USPS, UPS, FedEx, Canada Post and Purolator, Australia Post and StarTrack. As you process orders, compare the cost to ship through popular shipping carriers, and get the most bang for your buck without doing extra legwork.

Want to learn more about how Carrier Service can reduce shipping costs and protect your margins? Contact us for a quick 5 minute demo.

Briana Birkholz
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Man looking at boxes in warehouse

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