How to Build a Multi-Carrier Shipping Stack That Grows With You
Operational Risks: Sticking to a single shipping carrier limits flexibility and can inflate costs due to surcharges.
Cost Savings: Multi-carrier strategies can reduce shipping expenses by optimizing choices based on service and area needs.
Strategic Advantage: Using multiple carriers improves negotiation leverage and adapts better to market changes.
Performance Metrics: Track key performance indicators like cost per shipment and delivery rates to evaluate shipping efficiency.
Implementation Steps: Adopt a multi-carrier approach gradually with thorough data audits and performance pilots.
A few decades ago, when there were less than a handful of shipping carriers, using and being loyal to just one carrier made sense.
Today, however, sticking to a single carrier can cost your ecommerce business time and money—especially when better shipping solutions and shipping options are a click away.
Relying solely on one carrier could mean missing out on better shipping rates, reduced leverage in contract negotiations, less flexibility to adapt to changes, suboptimal customer experience, and more—for retailers running both online and store networks.
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We’ve seen the hidden costs of staying loyal to just one carrier first-hand.
Every peak season, brands and 3PLs come to us after being stuck with peak-season surcharges that they have very little ability to mitigate because they are at the mercy of a single carrier.
When you’re using just one carrier, you may find yourself stuck with whatever surcharges they implement, whereas other carriers may not implement the same surcharges that would affect your parcels, or may not implement surcharges at all.
Instead of scrambling after carrier rates start eroding your margins, this article will help you build a multi-carrier shipping solution that’s cost-effective and scalable.
Why Loyalty to a Single Carrier Can Kill Your Margin
Carrier surcharges have become a painful reality in parcel shipping.
Fuel surcharges alone were up more than 17% in 2024, and in some scenarios the iDrive team has seen shipping costs increase by 35% or more from just this single additional surcharge. Those add-ons push up price, undercutting any headline discount and masking true shipping costs.
Rather than just increase the fuel surcharge percentage, carriers have mainly increased the cost by changing the tables used to determine the percentage charged.
A less visible method, but no less effective in increasing the money they receive on a shipment.
Layer on things like residential surcharges, delivery area surcharges, peak season/demand surcharges, and more, and you’ll quickly find yourself scrambling to save your bottom line.
When you rely on a single shipping carrier for all of your shipments, you are at the mercy of whatever surcharges they decide to impose, regardless of the rest of the market.
Relying on a single carrier also means you are subject to any “weaknesses” in their network with regard to time in transit, bottlenecks, and cost. Diversifying across different carriers also gives you more leverage on carrier rates.
What a Multi-Carrier Strategy Can Accomplish for You
So now that we’ve covered why you need to diversify your carrier mix, let’s discuss what a multi-carrier shipping strategy actually entails.
When you have contracts with various carriers, or have access to different carrier options, you benefit from cost diversification and risk mitigation.
One company we recently worked with saw 30% savings from their shipping spend by going from a single- to multi-carrier strategy.
More options to match your priorities
Each carrier has their own strengths and weaknesses for shipping services, delivery options, and shipping methods.
You can pick and choose the ideal carrier based on each shipment’s priority, from shipping cost, delivery speed, or combination thereof.
Example: You can use a regional carrier for cost advantages, speed advantages, or both in certain areas and a national carrier for the rest.
Or you might use a consolidator for lower weight, lower value shipments to reduce cost, while utilizing a traditional carrier for higher priority items with tighter delivery dates and delivery time guarantees.
Spreading out your risk
Building something resilient in ecommerce means streamline-ready redundancy across shipping operations and upstream supply chain partners.
That means having more than one supplier, manufacturer, 3PL, shipper, carrier, and more to build up backups for your backups. If one shipper can’t deliver (pun intended) having a multi-carrier strategy means another is poised to step in as needed.
It also means that if one carrier introduces surcharges that will break the bank, you can reevaluate whether that is still the best option for your needs with multiple other rates at your fingertips.
I’ll give you an example of how this could look.
Historically, USPS hasn’t implemented surcharges for residential delivery, fuel, or remote areas. On the other hand, private carriers such as FedEx and UPS often introduce surcharges for the above, as well as a set of peak season surcharges.
Having more than one carrier could mean using USPS for your remote area deliveries, while still using other carriers for better rates within densely populated areas.
Partners can provide volume leverage
Negotiating contracts with carriers can get complex, and many brands don’t have the kind of volume that carriers require to provide the best rates.
However, you can partner with companies that negotiate carrier contracts and leverage economies of scale to get better rates.
Although popular carriers don’t publicize minimum shipping volumes to get the best rates, you can use large parcel volumes to negotiate carrier contracts.
Carriers benefit from scale, and smart shippers know and leverage this. This is especially helpful for small businesses that need enterprise-level cost savings without enterprise volume.
Key Metrics and Success Indicators
Before launching into a multi-carrier shipping strategy, take stock of your current shipping situation so you can look back and assess ROI.
You’ll want to audit and benchmark your current performance, then define the KPIs that are most important to your shipping strategy moving forward.
Pre-pivot benchmark metrics
Here are some potential areas to look at before shifting to a multi-carrier strategy.
Cost per shipment
Total landed cost ÷ shipments = cost per shipment
Cost per shipment refers to the total cost associated with processing, packaging, and delivering a single ecommerce order (or "parcel") to a customer.
It’s a key metric for understanding how much you're spending per order and identifying where you might be overspending.
By tracking and breaking down this metric, you can:
- Pinpoint expensive carriers or zones. If shipping to certain regions costs 2x more, you may want to consider zone skipping or local fulfillment centers.
- Optimize packaging and materials. Are you using too much filler or using boxes that are larger than needed for the product? Small changes here can cut costs significantly.
- Evaluate warehouse efficiency. High fulfillment labor costs per parcel might mean slow picking processes or poor layout.
- Benchmark performance. Comparing cost per shipment across time, locations, or fulfillment partners helps reveal areas to investigate and/or best practices.
- Support pricing and free shipping decisions. Knowing your true cost per order helps set realistic thresholds for when to offer discounts or free shippings.
On-time delivery rate
(Number of on-time deliveries ÷ Total number of deliveries) x 100 = on-time delivery rate
Your on-time delivery rate refers to the percentage of parcels delivered within promise windows. So for example, if you delivered 850 out of 1,000 parcels on time or earlier than estimated, you would have an 85% on-time delivery rate.
Pair this with shipment tracking event health and proactive notifications to reduce WISMO.
According to our internal metrics, the average on-time delivery rate is 97.5%* based on an analysis of 100,000 shipments via carriers such as UPS, USPS, FedEx, Amazon Shipping, GLS, and DHL.
*This information is based on a single warehouse, but switching to multi-node fulfillment has been shown to improve carrier performance and overall delivery experience for brands shipping across the U.S. so you can boost that number higher.
To compare this with industry claims:
- According to the USPS website, their on-time delivery rates range from around 86% to 95%.
- UPS reports a 96.5% on-time delivery rate.
- FedEx posted a 95.3% on-time delivery rate according to Freightwaves.
Tracking your on-time delivery rate can help uncover issues such as:
- Missed pick-up cutoffs due to late packing
- Carrier bottlenecks during peak seasons
- Poor handoff coordination between 3PLs
- Bad order routing—wrong fulfillment center selected
- Customer address errors causing delays
You’ll also get insights into shipping strategy moving forward. For example, if you notice your OTD for 2-day delivery is lower than average, you may consider changing cut-off times.
Or, if you notice that standard shipping has a high OTD rate compared to other service levels, consider promoting it with free standard shipping for a minimum spend.
Claims rate
(Number of claims filed ÷ Total number of parcels shipped) x 100 = claims rate
Your claims rate is the percentage of parcels that result in a delivery-related issue claim, typically for loss, damage, or delay.
These are claims filed with carriers or internally to resolve customer complaints.
An easy way to get this is to look at the number of lost or damaged incidents per 1,000 parcels. Keep an eye on this number across carriers, so you can see if some perform better than others when it comes to claims.
Based on iDrive internal metrics, you want to aim for a claims rate of one percent or less for best-in-class experience. A claims rate between one and three percent can be considered acceptable.
If you’re seeing a five percent claims rate or above, your shipping process direly needs to be evaluated for proper dunnage, warehouse best practices, and the like.
Your claims rates will help you determine if you need to:
- Reassess packaging durability for fragile items.
- Use tamper-evident or weather-resistant packaging.
- Shift high-cost or high-risk shipments to more reliable carriers.
- Implement better address validation to reduce mis-deliveries.
- Introduce fraud detection rules for high-claim areas/customers.
P.S. We shouldn’t have to remind you that keeping your claims rate low is vital for a good customer experience.
If someone has purchased from you, waited in anticipation for your package, and then wronged enough to have to make a claim, you are losing loyal customers and brand goodwill.
Surcharge ratio
(Total surcharges / total shipping spend) x 100 = surcharge ratio
Your surcharge ratio is the percentage of your total shipping spend that comes from extra fees, which are added on top of base rates.
These are additional charges carriers apply on top of your agreed shipping rates.
For example, fuel surcharges, residential surcharges, delivery area surcharges, additional handling surcharges, and other surcharges can all add significantly to total costs.
[Imagine a] typical package, a ground residential zone five, 10lbs parcel.
Let’s imagine that total expense, transportation, resi surcharge, everything all in [was] $11.50 on March 1st, 2021. Fuel on that parcel would have been $1.01 for $12.51.
You fast forward to December 23, 2024 and consider a very generic general rate increase–let’s say 5.9% every single year.
Over the course of this timeframe, the transportation and residential surcharge would have gone from $11.50 to $14.46, a 25.7% [increase] over that timeframe. Fuel would have gone from $1.01 to $2.57. A 155% increase.
Total effect on that parcel, 36.1% increase.
Surcharge ratios are largely dependent on shipping characteristics, and vary between 20 to 40% of your total shipping expense.
Some sample surcharges to keep an eye on include:
- Residential delivery fee
- Fuel surcharge
- Address correction
- Delivery area surcharge (DAS) and Delivery Area Surcharge Extended (EDAS)
- Additional Handling - Weight, Dimensions and Package
- Saturday delivery
- Oversize or dimensional (DIM) surcharges
- Return to sender fees
- Signature required fees
- Etc.
Tip: If you can quantify surcharges by type, you may be able to negotiate discounts, caps, and sometimes full waivers in your next contract cycle.
General Rate Increase (GRI)
General rate increases (GRIs) measure the actual impact to you vs what the carrier(s) announce.
A GRI is an adjustment in the base carrier rates that are supposed to reflect changes in operational costs, fluctuating fuel prices, equipment maintenance, and overall increases in costs. A GRI affects the base shipping rate, rather than acting as an additional cost (such as a surcharge).
For example, in 2023 FedEx announced an average 5.9% general rate increase for US domestic, export, and import services to expect in the following year.
Delivery time variance
Actual delivery date – Promised delivery date = delivery time variance
Delivery time variance is the standard deviation between promised and actual delivery dates.
It measures how consistent or inconsistent your delivery times are, compared to the expected or promised delivery window. This metric looks at both how quickly you deliver and how reliably you meet expectations.
For example, if your average delivery time is three days, a variance of two days means customers may receive packages in one day or five days, which makes for an unpredictable experience.
Tip: Aim for consistency over speed when it comes to delivery time variance. Look at how reliably your current carrier delivers within a promised timeframe.
Post-pivot success KPIs
Once you’ve added additional carrier support, monitor the metrics listed above to see how they change over time.
In particular, here are a few things that will show whether your pivot from a single-carrier was successful.
Cost per shipment improvement
Track the average shipping cost per parcel before and after adopting a multi-carrier strategy.
To find this, get the average cost per shipment from the month you were using a single carrier and compare it to the average cost per shipment from the month after switching.
Focus on the percentage drop vs your single-carrier baseline, with a goal of achieving a 10–15% reduction of shipping costs.
Break down by zone or service level to identify areas with the biggest savings, and highlight where regional carrier optimization delivers deeper cost cuts.
On-time rate lift
Measure the increase in on-time delivery rates compared to your previous benchmarks.
To find this, look at your on-time delivery rates from the month prior, and after your multi-carrier shift.
Multi-carrier routing should improve reliability by aligning lanes with carriers who perform best in specific regions.
Target a consistent on-time rate of 95%+ as a sign that service quality is improving, especially during peak or high-volume periods. Use granular tracking data to pinpoint weak lanes or carriers needing replacement.
Margin recapture
Quantify how shipping cost reductions translate into improved gross margin, particularly for lower-margin SKUs where logistics savings can make or break profitability.
To find this, track your average profit margins per SKU before and after shifting to a multi-carrier strategy. You should find that if your shipping costs went down, your margins went up.
Express savings as a percentage of gross margin gained, aiming for a one to three percentage point improvement or more.
This connects your logistics optimization directly to financial performance, making the case to reinvest in further supply chain improvements.
Customer experience lift
Link improved delivery performance to changes in customer satisfaction and customer experience metrics such as NPS or CSAT.
Segment feedback by delivery experience to show how faster, more reliable shipping improves customer perception.
To find this, look at your average net promoter score before and after your multi-carrier shift. Consider taking the last 50 scores before the switch, calculating the average, and then capture and average the first 50 net promoter scores that come in after making the switch.
Track short-form survey responses or quotes post-delivery to surface qualitative feedback that supports the business case.
A noticeable bump in sentiment, even just +5 NPS points, can translate into higher retention and repeat orders.
How to Pivot to a Multi-Carrier Shipping Strategy
Here are six high-impact steps to pivot to a multi-carrier shipping strategy.
The entire process can be as fast as half a month, or as long as half a year depending on how much you want to test solutions, the data you want to gather beforehand, and the like.
The team members you’ll most likely be relying on to make this evaluation and switch are likely your warehouse managers, fulfillment and operations directors, and your head of ecommerce.
1. Audit your shipping data
Start by getting a clear picture of your current parcel profile. Export 12 months of shipping data broken down by:
- Carrier(s) currently used. Shows which rate cards you’re limited to.
- Zones (where you're shipping to). Shows where your buyers are geographically.
- Service level (Ground, 2-Day, Overnight, etc). Uncovers customer expectations.
- Base rates and surcharges (fuel, residential, delivery area, etc.). Helps reveal your current landed costs.
- Shipping volume. Trend shipping volume by zone and service to spot seasonality and discount cliffs.
- Workflows. Map warehouse workflows that impact the shipping process.
This helps you get directional clarity.
Focus on identifying cost concentration areas: which zones, weights, or service levels are draining your budget? Are certain surcharges creeping into double digits? That’s where the cost leaks live.
2. Build your carrier scorecard
Next, score current and alternative carriers on cost, performance, and tech functionality/compatibility.
To find your alternatives, you may need to go directly to carriers and ask for a public rate card, try to negotiate your own carrier contracts, or work with a provider that can offer clear rates for different carriers.
Here are the metrics you should judge these carriers on:
- Cost per shipment
- On-time delivery rate
- Claims rate (lost/damaged shipments)
- Surcharges as % of total spend
- Delivery-time variance (how consistent is “2-day” delivery?)
Put these metrics side-by-side across your carriers. Underperformers will jump off the page, giving you data-driven justification to negotiate, replace, or reallocate volume.
3. Compare against industry benchmarks
Context matters. How do your carriers stack up against the latest shipping standards?
- In today’s market and according to our experience, 90% or higher is a very good on-time performance.
- Claims are seasonally and geographically driven, but a claims rate under 1% is a good target.
- You can expect surcharges to make up 20-40% of total parcel spend.
If your numbers fall short of the above, for example dipping below 88% on-time performance, above 2% on claims, or 50% or more of surcharge-to-spend ratio, that’s your signal to diversify and hold carriers more accountable.
4. Select your multi-carrier approach
There’s no one-size-fits-all path. Choose between building your own system in-house or partnering with a 3PL to handle multi-carrier execution.
If you have enough volume to negotiate good rates directly with carriers, you may want to test managing multi-carrier shipping in-house.
If you find the process too complicated, end up missing important points in carrier contracts, and are spending too much time on shipping rates rather than business growth, you may want to find a 3PL that can handle it.
Here are some questions to help you decide:
- Do you have a good understanding of carrier contracts and how they work?
- Do you ship more than 5,000 packages a month consistently?
- Do you have enough time to oversee, evaluate, and negotiate shipping rates with two or more carriers?
- Do you understand how surcharges from various carriers affect your parcels?
If you answered yes to the above, you may want to try in-house rate shopping. If you answered no, consider outsourcing via a 3PL or TMS.
Pros and cons of in-house rate shopping
Pros:
- Full control over carrier selection and routing logic.
- Faster iteration and adaptability.
- Lower long-term costs once setup is complete.
Cons:
- Requires in-house team capacity.
- Investment in API integrations, shipping software, and support.
- Steeper learning curve for carrier management.
- Requires volume levels with each carrier that make them value your business as a preferred client.
- Time spent on shipping draws time away from focusing on core business.
- Potential for missing contract minimums or hidden costs of dropping discount levels.
- You’ll also own ongoing carrier integrations, version drift, and support team load.
If you choose to go with in-house fulfillment, shortlist multi-carrier shipping software that can print labels (robust label generation), support rate shopping across various carriers, and expose a reliable shipping API for automation. Here are some top picks:
Pros and cons of outsourcing via 3PL
Pros:
- Turnkey access to carrier networks and negotiated rates, plus customer support from people who live in tariffs.
- Dedicated logistics experts managing routing and optimal carrier usage.
- Much higher volume leverage since your parcels would be part of a bigger batch.
- Greater focus on core business.
- Less worry about contract minimums.
Cons:
- Less transparency/control over carrier rules, since you won’t be negotiating directly.
- Integration complexity with existing platforms.
If you’re choosing to go the outsourced route, here are our top picks for 3PLs:
5. Diversify volume incrementally
Avoid flipping the switch all at once.
For example, if you suddenly move to a new carrier and discover they, for example, end up breaking more packages than normal, you’ll end up with a high claims rate.
If you start slowly and discover that occurring, you can adjust your dunnage and packaging to be more protective before a full switch.
Start by allocating 25% or less of volume to one or two new carriers.
We’ve found this is a safe number to have enough data to compare, while not risking too much of your operations and revenue at once.
Prioritize zones where your primary carrier is weakest. This could be areas with the most expensive landed costs, most missed deadlines, or most customer complaints.
Once you’re confident in your new carrier mix, and have worked out all the issues, move from 25% of your volume to 50%, and then so forth.
Scaling slowly helps reduce operational risk, uncover hidden gaps, and build internal trust in the new approach.
6. Pilot and measure performance
Run a two-week A/B test.
Two weeks is a short enough timeframe for more immediate analysis, while still accounting for enough time to gather sufficient data across two weekends, depending on your sales cycles.
Although a longer A/B test is possible for more data, it also means waiting longer for the results and decision, so weigh what’s important to you.
You should also run this test in delivery zones where volume is steady but not mission-critical.
So don’t run the A/B test in your make-it-or-break-it zones (just in case something goes wrong), but also not in shipping zones where you get so few orders you won’t have enough data to judge performance.
For your initial look at performance, compare:
- Cost per shipment
- On-time delivery rate
- Customer satisfaction or “where is my order?” (WISMO) inquiry volume
You can compare all the KPIs above, but these are the top metrics to look at for the sake of keeping analysis manageable for this test.
Make sure you have clear metrics and a plan to review the results. What worked? What didn’t? What surprised you? Use this insight to fine-tune your strategy before a full rollout.
Going back to step five above, start with 25% and keep a sharp eye out for anything you need to adjust.
Once your cost per shipment is down, on-time delivery rates are either down or the same as before, and customer satisfaction is up or same as before, expand to 50% volume by week three.
Advanced Tactics and Emerging Trends to Get Ahead
Once your multi-carrier foundation is in place, the next step is using it as a launchpad for innovation. These advanced tactics are ready for real-world testing now.
Early adopters are already seeing performance and cost advantages by putting them into play. Here’s how you can start piloting them today to stay ahead of the curve.
AI-driven carrier selection
Difficulty: Easy, with technology
Manually assigning carriers based on static rules is becoming outdated.
New machine-learning tools can analyze historical performance, real-time capacity, cost benchmarks, and even lane-level reliability before automatically assigning the most optimal carrier for each shipment.
Start small: Launch a sandbox pilot that handles a low percentage of your daily volume.
Evaluate outcomes on cost per package, transit time, and exception rate. A good TMS can help you find the best carrier and rate for the service level you want.
Dynamic exception routing
Difficulty: Easy, with technology
Shipping disruptions aren’t going away, but they can be anticipated.
With dynamic exception routing, you can define real-time triggers based on weather alerts, traffic congestion, regional capacity bottlenecks, or missed scan events.
When a risk condition is met, the system can instantly and automatically reroute a shipment, split the load, or escalate to a faster service.
For example, if a shipment is delayed in Southern California, you can trigger another carrier to pick up and deliver (either from the same warehouse or another one nearby) for on-time arrival, even enabling same-day handoffs in dense metros.
This will result in fewer missed service commitments, fewer angry customer calls, and stronger resilience during peak or unpredictable periods.
Offer sustainability filters
Difficulty: Hard, but can be easier with the right partnerships
Customers increasingly want control over the environmental impact of their deliveries.
Research from the last-mile logistics company Stuart found that 27% of customers they surveyed would pay more for eco-friendly deliveries, and 41% would be willing to wait longer for a sustainable delivery.
Adding a “green shipping” option at checkout can meet that demand without increasing operational cost.
You can prioritize low-carbon lanes, electric vehicle fleets, or carriers with certified sustainability practices.
It's also a competitive differentiator: offering sustainable choices shows that your logistics strategy is faster, smarter, and more responsible.
Leverage blockchain transparency
Difficulty: Easy, with technology
Multi-carrier setups introduce complexity in package handoffs, raising the risk of tracking blind spots or invoice disputes.
Blockchain-based tracking tools offer immutable, time-stamped logs of each transaction in the shipping chain without relying on a single carrier’s system.
You don’t need to overhaul your entire stack to try this. Several logistics platforms offer plug-and-play blockchain pilots that can be activated for specific routes or high-value shipments.
Pitfalls and How to Dodge Them
A multi-carrier strategy is great, but more complicated than a single-carrier strategy, which means it does come with some risk. Don’t charge ahead and stumble on avoidable missteps that cost time, money, and internal credibility.
Here are a few of the common pitfalls—ordered by most to least impactful—we’ve seen and how to address them.
1. Over-engineering your carrier mix
It’s tempting to bring on every carrier promising better rates or coverage. But more isn’t always better.
Adding too many carriers means you’ll need to spread out your order volume further, which means fewer parcels per carrier (particularly dangerous if you have volume minimums in your contracts).
Adding carriers too quickly can overwhelm your tech stack, overcomplicate your workflows, and confuse fulfillment teams.
Guardrail:
Work with a partner that can balance your carrier mix on your behalf, or one that will give you access to all the best carriers but then intelligently recommend specific carriers in each scenario.
2. Ignoring contract fine print
Carrier agreements often come with strings attached: minimum volume commitments, tiered discount structures, auto-renewal clauses, or penalties for shortfalls.
If you miss these in the fine print, you could end up paying more even with a multi-carrier setup.
Guardrail:
Use a quick checklist before signing or renewing any contract:
- Is auto-renewal turned on? If you don’t give notice of no intention to renew, will your contract automatically roll over and become binding for another period of time?
- Are there volume minimums? Consider your peaks and valleys for sales seasons, and adjust your minimum volume to account for your low season as well.
- What happens if I fall short? If you don’t hit the minimum volume in the contract, do you get a fine or penalty, or does another rate kick in?
- Is there a grace period? How soon do you have to reach your agreed minimums? Consider how long it will take for operations to switch over.
Sometimes, brands will provide their entire sales volume when rate shopping with carriers. That means those carriers are expecting their full parcel business.
However, when you want to work with more than one carrier, it also means you’ll need to split your shipments.
This is where contract minimums can get tricky, because a brand might say “we sell 20,000 units a month” but they mean in total, and will need to split that across three carriers depending on different shipping scenarios.
3. Letting data live in silos
Shipping performance affects more than just the warehouse.
If finance, operations, and customer experience teams are working from different data sources, you’ll get mismatched KPIs, slow issue resolution, and missed optimization opportunities.
Guardrail:
Establish a shared data ecosystem early. This could be as simple as a unified business insights dashboard that aggregates carrier performance, cost per shipment, and delivery accuracy.
Or you can do a weekly cross-functional sync to review trends and flag issues.
4. Skipping regular performance reviews
A pilot isn’t a “set it and forget it” exercise.
Carriers adjust rates, zones shift, and volumes fluctuate, especially during peak season. If you’re not doing regular reviews, yesterday’s optimal setup might quietly become today’s liability.
Guardrail:
Build in structured reviews monthly for the first three months, then quarterly thereafter. Review cost-per-shipment trends, on-time performance SLA compliance, and claim rates.
Use this data to renegotiate rates, retire underperforming carriers, or update your routing logic. Treat your strategy as a living system, not a one-time decision.
Diversify Your Carrier Mix to Succeed
Having a single point of failure in any part of your business is a huge risk, and that goes the same for your shipping and carriers, too.
Relying on a single carrier can hurt your negotiating power, optimization options, and overall bottom line. Instead, follow the steps outlined above to implement your multi-carrier strategy.
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Multi-Carrier Shipping FAQs
Just to wrap things up, here are a few FAQs laid out in an easy-to-skim way from our article above.
What minimum shipment volume justifies a multi-carrier strategy?
We usually recommend a minimum of 5,000 packages or more per month to truly leverage the best negotiating power for carriers. If you can’t make those minimums, consider working with a partner that can batch your shipments with other brands, consolidating for larger numbers.
Which core metrics should I benchmark before making a switch?
Look at cost per shipment, on-time delivery rate, claims rate, surcharge ratio, and delivery-time variance before making the switch.
Should I build rate-shopping in-house or partner with a 3PL?
As with so many things in ecommerce, it depends.
Do you have enough volume to leverage when negotiating directly with carriers? Do you have enough industry experience to understand carrier contracts? Do you have enough resources to build custom software that can automatically and easily get your warehouse the best labels for each shipment?
If so, give it a shot. If not, consider finding a partner that can focus on shipping so you can focus on growth.
How do I manage returns when using multiple carriers?
We suggest using a dedicated returns partner to handle returns, so everything is consolidated in one place for your business and your customers.
However, you can also negotiate rates with different carriers to ensure hassle-free and cost-competitive return shipping rates.
How often should I re-evaluate carrier performance and rates?
Carrier performance should be evaluated monthly. Rates/contract terms should be evaluated anytime the carrier(s) make a change to their tariff. As of late, there seems to be changes made every couple of months.
What’s the timeline for seeing measurable savings?
You should start seeing savings right away once you switch to a multi-carrier strategy.
However, if you’re building that multi-carrier strategy in-house you’ll want to plan things out, and test each step incrementally to evaluate new carriers carefully along the way.
How can I automate carrier selection by zone, weight, or delivery date?
You can use a transportation management solution to find the best shipping rates by zone, dimensions, and delivery date.
Advanced systems can analyze dynamically across millions of data points in real time to find the best combination of carrier, service and rates for your exact scenario, every time.
