Shipping Rates & Contract Negotiation
At ShipSigma we manage, analyze, and optimize over $1Billion in parcel spend to provide you with a deep understanding of the excess of fees your contract has built in and where savings exist. Using our industry-leading cost modeling software, we’ll provide you with a Shipping Savings Guarantee before you negotiate. Once negotiation begins, we'll provide you with a market-best carrier network strategy, contract management & compliance services, surcharge mitigation, and ongoing analysis and optimization opportunities.
We could not say enough good things about our relationship with ShipSigma. Beyond the initial savings, they continue to find us new angles for savings, set up dashboards specific to our needs, and meet with us quarterly to go through reporting/review savings/new opportunities. ShipSigma has been more than just a service for us, they have been a continuous partner as we navigate the difficulties of controlling our freight costs and holding the vendors accountable.
Tyler B. Vice President of Finance, Leading Global Manufacturer
4 hours. It took less than 4 hours of my time for my company to see half a million in annual savings. No headaches, no feet-dragging negotiations, no confusing documents. It was so easy.
Todd M. Vice President, Food Manufacturer and Distributor
The insights and analytics, ShipSigma provided before and after negotiating our carrier agreements, make it clear we have a long-term partner who is aligned with our company values. The cost modeling and rate simulation let us know the exact savings we would see, down to the last cent. After running our historical data, ShipSigma was able to find us almost 28% in annual shipping savings with our same carrier.
Jonica H. Controller, Market Leading Wine Distributor
Our team managed billions of dollars of various category spend. To have ShipSigma guarantee a savings and then fully execute so that we’re realizing increased EBITA within 60 days allows us to focus on other strategic opportunities.
Randy H. Chief Procurement Officer, Leading Provider of Pork Products
We thought we had the best rates. We were told we had the best rates. ShipSigma got us better rates. They found us nearly 25% in savings and helped us renegotiate our contract with our carrier. It was just so easy.
Brad M. Chief Operations Officer, Clothing Retailer
The parcel invoice audit was a lifesaver for us. The team at ShipSigma monitored the weekly audit and noticed that instead of shipping air, over 60% of our packages could have traveled ground with no delay in arrival. They saved us more money than we had ever saved in our manual audit process.
Julie F. Chief Financial Officer, Industry Leading Retailer
Small Parcel Definition
Small parcel shipping is a major driver of today’s economy, from the shipping of spare car parts to beauty products. In this article, we will explore what small parcels are, how they are moved across the nation, and some tips to help you ship them successfully.
Small Parcel Shipping
The small parcel definition in shipping refers to relatively small and light packages, typically weighing no more than 150 pounds. The exact weight limit for small parcels varies by shipping carrier.
Small Parcel Shipping Process
Carrier Selection
To choose a shipping carrier and shipping service that is right for you, look at variables like your budget, desired delivery time, and the type of package you’re shipping.
If your priority is low shipping costs, opt for services like UPS Ground or FedEx Ground, which have lower rates but slow delivery times. If speed is more important than keeping costs low, go for express services like FedEx First Overnight or UPS Next Day Air.
Your package type can also affect your shipping service choice. For example, hazardous materials like lab chemicals may require special planning with the carrier.
You may also want to consider other things like the availability of insurance, tracking capability, and overall reputation before settling on a shipping company.
Package Preparation
To ensure your package arrives at its destination whole, take time to package it properly.
- First, you need to select a box that is appropriate for the item you are shipping. The box should be sturdy enough to withstand light to medium impact during transit.
- When placing your item(s) in the box, wrap them with cushioning material to protect them and prevent shifting during transit. For example, a ceramic vase would be wrapped in bubble wrap and placed in the box. The space would then be filled with packing peanuts.
- Seal the package. Use strong packing tape to seal the box or envelope securely.
- Print and apply the shipping label on the box. Make sure that the address is accurate, legible, and properly formatted. It is also good practice to include a return address in case the package cannot be delivered.
- Weigh and measure the package. Use a postal scale or a kitchen scale to weigh the package and ensure that it meets your carrier's weight and small parcel size restrictions.
- Pay for shipping. After paying, make sure to get a receipt for your payment. It can be used as evidence in case of loss and it can also be used to track the package.
Pick-up or Drop-off
When your package is ready for sending out, you can go online to arrange for pick-up with your local carrier office. The shipping date you provide when filling out the form will determine when the package will be picked up.
Alternatively, you can visit an outlet to hand over your package in person. Some companies offer drop-off solutions where you send over your package without any person-to-person contact, e.g., FedEx Drop Box.
Processing and Transit
Once the package is in the carrier’s hands, it is sorted according to destination. Using zone maps, the optimal route is determined, and it is put on an outbound truckload to begin its journey. The journey may include multiple stops and transfers.
Small Parcel Tracking
The shipping label usually includes a barcode which is scanned at checkpoints on the package’s route to its destination. The shipping status and location are then automatically updated in the online portal. Using the tracking number provided to you, you can access the status of your shipment.
Delivery
Finally, the carrier delivers the package to the recipient's address. Some carriers offer special delivery options like Saturday delivery for which you have to pay a fee.
Potential Returns
Sometimes, the recipient may not be satisfied with the item they received. In such a case, they can ship the item back using a prepaid return label provided by the seller or one that they purchase themselves.
What Is Small Parcel Delivery?
Small parcel delivery refers to the transportation of small packages (parcels) that are typically under 150 pounds and can be easily carried and loaded by one person. It is worth noting that some carriers actually cap small parcels at 70 pounds, so be sure to do your research before hand.
Small parcel delivery services are commonly used for shipping items such as shoes, electronics, and books, among other small items. Since these items are usually non-urgent, they are shipped using shipping services with longer shipping times and lower rates.
Types of Small Parcel Delivery Services
There are several types of small parcel delivery services available to individuals and businesses. Some of the most common services include:
Standard Ground Delivery - This is the most economical option and also the slowest option for shipping small parcels. With regular ground shipping, it typically takes between 3-7 business days for the package to arrive.
Expedited / Express Delivery - This service is used when the package needs to be delivered urgently, and typically takes 1-3 business days for delivery. Medical supplies are a good candidate for this service.
Same-day Delivery - This is a premium service that guarantees delivery on the same day the package is shipped. Examples of same-day services are UPS Express Critical and FedEx SameDay.
International Shipping - This service is used for shipping small parcels to other countries. International shipping typically requires more documents, is more costly, and takes longer than domestic shipping.
Tips for Successful Small Parcel Delivery
Small parcel delivery, especially when you’re shipping often or at high volumes, can be challenging. To ensure successful small parcel delivery, put these tips into action:
-Properly package your item to ensure it arrives at its destination in good condition.
-Label your package clearly with the correct shipping address and return address. If you’re a seller, include a return shipping label in the original shipment. This makes your time easier during returns and also promotes customer satisfaction.
-Choose the right shipping service for your needs based on delivery speed, cost, package type, budget, and tracking options.
-Consider purchasing insurance for valuable items to protect against loss or damage. Most carriers like FedEx and UPS include insurance of a low amount (mostly $100) in your shipping fee. For extra coverage, you need to declare the value of your shipment.
-Always keep the tracking number for your package and monitor its progress to ensure on-time delivery.
-If possible, schedule the delivery for a time when someone will be available to receive the package. That way you can avoid delayed deliveries or your package being stolen by ‘porch pirates.’
-If you are shipping internationally, make sure to include any necessary customs forms and accurately declare the contents of your package.
Small Package Delivery Companies
Small package delivery companies are a key component of the logistics industry and the general economy. They enable individuals and businesses to ship small boxes of standard package dimensions quickly and affordably.
Three of the most well-known small package delivery companies are UPS, FedEx, and USPS. Here's a closer look at each of these companies and how they handle small package delivery.
UPS Small Package Delivery
UPS is a multinational shipping company that offers a variety of small package delivery services. Some of the most popular UPS services include:
UPS Ground: This is the most economical UPS service for small package delivery, with delivery times ranging from 1-5 business days depending on the destination zone. The cost to ship a small package via UPS Ground ranges from $10.10 to $856.00.
UPS 2nd Day Air: This service guarantees delivery within 2 business days and is ideal for time-sensitive packages. The cost range of UPS 2nd Day Air is $21.64 to $1,139.60.
UPS 3-Day Select: UPS 3-Day Select is designed for those who need a faster delivery option than standard ground shipping but do not require overnight or expedited delivery. Packages are delivered within 3 business days and the cost range is $13.66 to $827.47
UPS Next Day Air: This service guarantees delivery by the next business day and is the most expensive small package delivery option. It is ideal for very urgent deliveries. The cost of UPS Next Day Air varies depending on the package's weight, dimensions, and destination but the range is between $35.00-$1,750.83.
FedEx Small Package Delivery
FedEx is a global shipping company that offers several small package delivery services, including:
FedEx Ground: This is the cheapest FedEx service for small package delivery, with a cost range of $10.10–$152.56. Delivery times for FedEx Ground range from 1-5 business days depending on the destination.
FedEx 2Day: This service guarantees delivery within 2 business days and therefore is an ideal option for urgent packages. The cost of FedEx 2Day ranges from $22.59 to $1,104.00.
FedEx Overnight: This is the most expensive small package delivery option offered by FedEx. It includes several services including:
-FedEx First Overnight: Delivery is the next day by 8 or 8:30 a.m. Price range is $68.04–$1,594.50.
-FedEx Priority Overnight: Delivery is the next business day by 10:30 a.m. to most areas, by noon to residences, and by 4:30 p.m. to some remote areas. The price range is $37.04–$1,548.00.
-FedEx Standard Overnight: Delivery is the next day by 4:30 p.m. to businesses and by 8 p.m. to residences. The price range is $33.87–$1,474.50.
USPS Small Package Delivery
The United States Postal Service (USPS) is a government agency responsible for mail delivery throughout the United States. Small package USPS delivery services include:
First-Class Package Service: This is the most affordable USPS small package delivery option, with prices starting at $4.75. However, you can only ship packages 13 oz. and under with this service. Small packages are delivered in 2–5 business days.
Priority Mail: This service offers delivery within 1-3 business days and is a good option for time-sensitive packages. The price range for this service is $9.35-$401.35.
Priority Mail Express: This service guarantees delivery by the next business day and is the most expensive small package delivery option offered by USPS. The cost of Priority Mail Express ranges from $28.75 to $688.20.
When comparing the small package delivery services of UPS, FedEx, and USPS, remember to consider not only the cost but also the delivery time and additional features like package tracking and insurance.
Generally, UPS and FedEx tend to be more expensive than USPS but offer faster delivery times and more robust tracking and insurance options.
How ShipSigma Can Help
ShipSigma experts, powered with AI systems, analyze your shipping account, use the findings to negotiate a better contract with your carrier and audit your account weekly to ensure your rates are always the best they can be. Give us a call today and let us show you what you’ve been missing.
FAQ
A parcel typically refers to a relatively lightweight small package that is usually small enough to be easily handled by one person. A parcel can range in weight from a few ounces to around 70 pounds. Parcel shipping is often used for sending personal mail, business-to-business deliveries, and direct-to-consumer shipments.
On the other hand, freight refers to a larger consignment of goods transported using special means such as freight trucks, ships, or planes. Freight shipments typically consist of multiple packages bundled together on pallets, crates, or other large shipping containers.
USPS Retail Ground and USPS First Class Package are the cheapest ways to ship a 1-pound package.
UPS Ground and FedEx Ground are the cheapest options for sending 20 lb packages.
USPS Retail Ground and USPS Priority Mail are the cheapest options for shipping packages with weights of between 1-5 pounds.
Amazon partnered carriers are authorized by Amazon to transport packages on behalf of the company, while other carriers are not affiliated with Amazon in any way.