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 Size
As a shipper, it is essential to know the guidelines that carriers like UPS, FedEx, and USPS have in place regarding the weight and size of small parcels. Knowing them can help you avoid parcel rejections, surcharges, or unnecessarily high shipping costs.
In this blog post, we'll cover everything you need to know about small parcel sizes.
What Is Small Parcel Delivery?
While the definition varies from carrier to carrier, a small parcel can generally be described as any package that weighs 70 pounds or less. Therefore, small parcel delivery is the transfer of small parcels from the origin address to a destination address.
Apart from small parcel delivery carriers offer other transportation methods that need to be differentiated from small parcel delivery. These methods are Less Than Truckload (LTL) and Full Truckload (FTL).
Small Parcel Delivery vs Less Than Truckload vs Full Truckload
Small parcel delivery is mainly for shipping one or a few small parcels at a time. LTL and FTL siping can also be used to ship small parcels, but a large number of them.
Less-than-truckload shipping is a shipping method that is used to transport shipments that are not big enough to take up the capacity of an entire truck. LTL shipments typically weigh between 150 and 15,000 pounds, but the exact weight and size limits can vary by carrier.
LTL shipping involves combining shipments from different people in order to fill a truck. Since the cost is shared, LTL is a cost-effective option for shippers that need to send small quantities of freight without paying for a full truckload.
Full truckload on the other hand is where a single shipper pays for a whole truck’s capacity. This shipping method is used when an individual shipment is large enough to fill a truckload. FTL shipments typically weigh more than 15,000 pounds. FTL shipping can be a more cost-effective option for businesses that need to ship large quantities of freight, as the cost per unit of freight is often lower than with other shipping methods.
Types of Small Parcel Delivery Services
- Standard delivery - Standard small parcel delivery is often the cheapest and slowest option. Delivery time is 2-5 business days for most carriers. Ground shipping falls under this category.
- Expedited delivery - This service delivers shipments faster than standard delivery but is also more expensive. Delivery times for expedited services are between 1 and 3 business days. 3-Day shipping is an example of expedited small parcel delivery.
- Express delivery - Express shipping is a fast shipping service that is used when shipments need to arrive somewhere urgently. Delivery is done the next day up to 2 days after shipping. Next Day shipping and 2 Day are examples.
- Same Day delivery - This is the fastest and most expensive service that carriers offer. It is ideal for small parcels that require very urgent delivery, such as medical supplies and perishable goods.
- Specialty Delivery: Carriers offer special shipping conditions for special packages such as hazardous materials, fragile items, and high-value goods. It involves special conditions, temperature control and extra handling which make this option more expensive than standard shipping services.
- Flat-rate Delivery: Some carriers offer flat-rate delivery services, where the cost of shipping is based on the weight of the parcel and not the distance. This can be a cost-effective option for heavier parcels.
What Is the Smallest Box You Can Ship?
Different carriers have different minimum and maximum weight limits for small parcel delivery. Let’s look at the limits of major small parcel carriers.
UPS Smallest Box Size
The smallest box you can ship with UPS is a box weighing 1 pound. This means that even if your parcel weighs 0.5 pounds, it will still be charged at the 1-pound rate. The largest box you can ship with UPS is a 150-pound package.
Below are the rates and delivery times to ship a 1-pound box with UPS:
(Prices are accurate as of April 2023)
Service |
Delivery Time |
Cost range to ship a 1-pound box |
UPS Express Critical |
Same day |
|
UPS Next Day Air Early |
1 day |
$65 to $136.72 |
UPS Next Day Air |
1 day |
$37.44 to $106.79 |
UPS Next Day Air Saver |
1 day |
$32.71 to $86.29 |
UPS 2nd Day Air A.M. |
2 days |
$23.64 to $45.11 |
UPS 2nd Day Air |
2 days |
$21.64 to $66.79 |
UPS 3-Day Select |
3 days |
$13.66 to $33.33 |
UPS Ground |
Within 5 days |
$10.10 to $61.37 |
UPS Simple Rate |
1 day, 2 days, 3 days, or within 5 days Depending on service |
Starting at $10.20 |
FedEx Smallest Box Size
With FedEx as well, the minimum chargeable weight for a small parcel is 1 pound. Below are rates and delivery times of various FedEx small parcel delivery services:
(Prices are accurate as of April 2023)
Service |
Delivery Time |
Cost range to ship a 1-pound box |
FedEx First Overnight |
Next day by 8 or 8:30 a.m. |
$68.04 to $128.32 |
FedEx Priority Overnight |
Next day by 10:30 a.m. to most business addresses, by noon to residences, and by 4:30 p.m. to some remote places. |
$37.04 to $97.32 |
FedEx Standard Overnight |
Next day by 4:30 p.m. to business addresses and by 8 p.m. to residences. |
$33.87 to $85.43 |
FedEx 2Day A.M. |
Second day by 10:30 a.m. |
$25.37 to $45.22 |
FedEx 2Day |
Second day by 4:30 p.m. to most areas and by 8 p.m. to residences. |
$22.59 to $37.55 |
FedEx Express Saver |
Within 3 days |
$21.03 to $34.37 |
FedEx Ground and FedEx Home Delivery |
Within 5 days |
$10.10 to $12.74 |
USPS Smallest Box Size
The smallest box size you can ship with most USPS service is a 1-pound package. However, for Priority Mail Express, the smallest box size is 0.5 pounds. Also, USPS First-Class Package Service is made for shipping small boxes, with a minimum weight limit of 13 ounces, which is about 0.8 pounds.
Below are rates and delivery times for shipping a 1-pound box using USPS small parcel delivery services:
(Prices are accurate as of April 2023)
Service: Priority Mail Express
Smallest box size: 0.5 pounds
Cost to ship a 0.5-pound box: $28.75 to $56.00
Service: Priority Mail
Smallest box size: 1 pound
Cost to ship a 1-pound box: $9.35 to $21.35
Service: First-Class Package Service (Retail)
Smallest box size: 1 ounce (0.0625 pounds)
Cost to ship a 1-ounce box: $4.75 to $5.25
Service: USPS Ground (Retail)
Smallest box size: 1 pound
Cost to ship a 1-pound box: $8.95 to $11.05
What Is the Smallest Size Package for UPS?
UPS doesn’t have clear minimum size limits for their packages. However, the minimum chargeable weight for a UPS package is 1 pound. Read the UPS Parcel Weight & Size Guide for more information.
How Does USPS Determine Package Size?
For a package carrier like USPS, the package size is one of the most important details of a shipment. This is because package size helps to calculate the appropriate shipping cost and also to ensure that the package can fit and be processed through USPS' sorting and delivery systems. USPS has various guidelines and tools in place that it uses to determine the size of your parcel.
The first consideration for determining package size is the weight of the parcel. There are two kinds of weight used by USPS: actual weight and dimensional weight. USPS calculates both and then uses whichever is higher to determine your shipping costs. Most times, dimensional weight is used for packages that are particularly large but lightweight.
To find ‘actual weight,’ all you need to do is weigh the parcel on a scale. This is easy to find since it just involves weighing the package on a scale.
Dimensional weight calculation is a little bit longer process:
- Step 1: Determine the package measurement in inches
Measure the package's length, width, and height, rounding each measurement to the nearest whole number.
- Step 2: Multiply the package length by the width by the height
Length x Width x Height = Cubic Volume
- Step 3: Divide the cubic size by the divisor
Divide the cubic volume (in inches) by a divisor (USPS uses 166) to determine the dimensional weight in pounds. Increase any fraction to the next whole pound.
USPS also has size restrictions in place for packages. Packages must not exceed 108 inches in combined length and girth. Additionally, packages must not exceed 70 pounds in weight. Any package that exceeds these size limits is considered oversized and may incur additional fees or be rejected for shipment.
USPS also has a variety of tools and resources that customers use to measure their packages and calculate prices. For example, USPS offers a postage calculator on their website that allows customers to enter the dimensions and weight of their package to determine the appropriate postage rate. Additionally, USPS provides measuring tools at their post office locations to help customers accurately measure their packages.
When a package is processed for shipment, USPS may also use automated systems to determine the size of the package. For example, some USPS facilities use machines that can scan packages and measure their dimensions automatically.
How ShipSigma Can Help
ShipSigma is a leader in small parcel contract analysis and negotiation. We have worked with over 300 customers, saving them more than $100M in shipping costs.
Want to be our next success story? Contact us today.
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.