How to Diversify Your Shipping Carrier Mix to Save Money

Over the years, the shipping industry has grown to include more than just UPS, FedEx, and the USPS. Today, there are more small and mid-sized carriers, last mile delivery services, and other supplemental service providers that continue to gradually change the landscape of shipping and how parcel carriers operate today. With all these options available, why is shipping with one parcel carrier the norm? By diversifying your shipping carrier mix, you open your business up to savings or new service opportunities you may have been overlooking all this time.

Why You Should Use a Diverse Shipper Carrier Mix

When you first look into diversifying your carrier mix, the catalyst is often your shipping costs. Certain carriers may be the most cost effective option for certain services or regions, but destroy your shipping budget when it comes to other areas, services, or surcharges. While this is certainly the most obvious and immediate benefit of this practice on the shipper side, supplementing your main carrier with other providers often helps your transit times and improves your customer satisfaction rates.

With additional carriers in your shipping network, you get the ability to leverage the right provider when the circumstances call for it. By having multiple shippers to choose from, you’ll be able to choose which carrier will get your shipments to their destination the quickest. By being able to offer faster delivery times at lower rates, customer satisfaction is more likely to increase, resulting in stronger customer loyalty and potential return customers.

How to Diversify Your Carrier Mix

Depending on your current situation and the carriers you’re already using, there are a variety of directions you can take to begin diversifying your carrier mix. Take a closer look at what your business needs most from your shipping providers so you know where to start looking first. 

See Where Your Current Mix is Lacking

An easy first step to diversifying who you ship with is to take stock of where your current parcel carriers are lacking or which surcharges you’re being affected by most. For example, if you’ve recently seen an increase in delivery area surcharges from one carrier, or oversize charges from another, these can be great areas to keep in mind when looking for additional carriers to supplement your existing contracts. Additionally, you should keep in mind which areas your existing parcel carriers aren’t able to accommodate; adding a new shipping company that can fill this gap is a great way to expand your reach.

Consider Regional Carriers

While FedEx and UPS offer national–and even international–services that make them the giants of the shipping industry, regional carriers are great to leverage to help with costs and delivery time in certain parts of the country. Since these shipping companies are often smaller, they’re more likely to be familiar with their service areas, allowing them to be more efficient and flexible in their delivery service options, like next-day delivery or fast weekend turnaround. By using both national and regional carriers, you can provide your customers with the shipping service that’s best for their area.  

Add Last-Mile Delivery Providers

In a previous blog, we discussed what last-mile delivery is, which of the major parcel carriers use them already, and how you can take advantage of their unique service to save on your usual shipping costs. Last-mile carriers are a great way to diversify your shipping carrier mix because you can still use the large carriers to take advantage of their affordable resources, while also saving money on the final mile of the delivery process that often contributes to the high surcharges or additional delivery costs associated with UPS or FedEx. 

Include Small & Medium-Sized Carriers

With the duopoly FedEx and UPS have held over the shipping industry for the past few decades, it’s easy to forget that there are plenty of small carriers that will offer flexible terms for your occasional local and rural deliveries. Additionally, mid-sized parcel carriers can offer a middle ground between the large and small carriers, providing a wide variety of resources similar to UPS and FedEx, and the small, niche perks of the small shipping companies. 

Whether you’re actively looking to diversify your parcel carrier mix or you’re considering new ways to save money on your shipping logistics, you have a variety of options to choose from, including a software that can assess all your shipping data for you. Reveel’s shipping and logistics intelligence platform gives you the tools you need to better understand your shipping data. With the actionable insights you gain with us, you can easily uncover opportunities for savings, analyze your shipping costs, and find the best areas to diversify your shipping carrier mix. Request your demo to learn more and start saving now.

The Reveel App uses AI and machine learning to provide an unparalleled look into what’s impacting your bottom line. Through invoice audits, AI and Machine Learning technology, and rate modeling/simulations, you can see the health of your operation and assess pricing changes from parcel carriers like FedEx and UPS. Sign up for a free Reveel account today to see how you can leverage automation to synthesize your data, ship more for less, and reduce the time needed to identify issues and action items.

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