Reducing Outbound Shipping Costs

Kris Gösser](/content/author/kris-gosser/index.html)

Updated September 10, 2026

What drives outbound delivery costs for enterprise operations?

Outbound shipping costs are mostly influenced by the rates available to you via carriers in which you have a contract. Contracts are often non-standard, and will have some combination of volume thresholds, methods, package dimension definitions, and geographical zoning rules.

Carriers are the usual suspects, like USPS, FedEx, and UPS, but they can also be regional or local carriers. In fact, there is a whole world of localized carriers who can provide major cost saving opportunities, which we’ll get into in a moment.

Most ecommerce companies will go directly to a carrier and negotiate contract rates with them, but it doesn’t have to be this way. Often, alternative contracts and rates are available to you:

• Through your 3PL, who might have their own contracts with national or local carriers.
• Through independent consultants, who act on your behalf to negotiate rates with a carrier. Often the model is they are the ones who have the contract with the carrier and sell through to you.
• Through a specialized vendor, who is a lot like a consultant, but has more of a product orientation. ShipStation is the largest and most prevalent. They effectively act as a “Group Purchasing Organization” (GPO).
• Through a different software platform which might include shipping capabilities. An example is Shopify, which offers sell-through rates from USPS, UPS, and DHL.

The single biggest myth with shipping is that one carrier or method is the best. There is no universal best rate. Ecommerce companies can be lulled into thinking that, especially from a sales rep at one of the carriers.

In fact, the best way to save multiple percentage points on outbound shipping is through arbitrage across multiple carriers and methods.

How major brands streamline their outbound logistics

We learned a lot from our experiences at Amazon and Zulily where we built the systems that power their real-time carrier selection. Integrating effective arbitrage into their outbound logistics activities yielded higher savings.

The following needs to happen:

• Find and secure multiple carrier contracts comprising multiple methods.
• Explore and secure specialized rates depending on your specific business context.
• If multiple FCs, instantiate those carrier rates across diverse geographical zones.
• Available rates need to be digitized at the FC level.
• Stay on top of dynamic pricing changes.

The good news is that you can get to a mature process involving multiple carriers and methods.

How to reduce the cost of outbound shipping

Substantial savings begins with having options. Here are five steps to follow:

1. Audit your inventory

Start by charting out your SKU portfolio and the types of package dimensions you expect to use.

2. Map out your delivery promises

Chart out how fast you want to deliver. Understand how much margin you are willing to give up for speed.

3. Review your carrier contracts

Map out existing carrier contracts for optimized parcel types, speed configurations, and geographical rules. For gaps, source options from other carriers.

4. Refine your carrier selection

Expose your rates for real-time tracking and decision making. Build a software system that allows for dynamic changes.

5. Integrate frontend and backend systems

Integrate with your frontend ecommerce store, your warehouse management system, and the fulfillment network to make real-time decisions.

Avoid these traps when refining your outbound shipment process

• Pay attention to differences in contracts and ensure meaningful cost savings with arbitrage.
• Be wary of consultants promising large savings; avoid relying only on one carrier.
• Monitor dynamic pricing aspects closely.

Why shipping metrics matter for operators

For shippers, it’s critical to log detailed shipping metrics to track options available at the time of decision and ensure precision.

How Shipium helps manage the cost of shipping

The Shipium platform provides automated carrier selection decision-making at the point of fulfillment. It can typically provide cost reduction of around 2% on shipping when using our service.