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The Pros and Cons of Multi-Carrier Shipping

May 20, 2020 7:30:00 AM

Multiple carriers can mean extra opportunities, but it increases the need for shipping vigilance. Here’s how 71lbs can help.

A one-carrier relationship may seem logistically easier than spreading your packages and paperwork around, but multi-carrier shipping can provide certain opportunities and options that are not available to one-carrier relationships. With that said, increased flexibility for shipments means elevated risk and greater pressure to watch every move each carrier makes. Let’s start by listing the pros of having more than one carrier on your side.

You’ll always make the best logistical decision

One carrier’s air policy may be better than another’s and vice versa for ground or other services. Perhaps one carrier is head and shoulders above the other for Last Mile delivery, making them an ideal secondary-use partner. Using multiple carriers lets you select the best team for the job. If they’re equally qualified for your business, you can go with the company that offers the best delivery rates and route options.

The drawback here is that studying multiple carrier qualifications isn’t a one-time effort; their routes and rates frequently change. Shipping departments must perform constant in-depth research to stay informed on which carrier is best suited for the next delivery.

Each carrier is effectively the other’s failsafe

Carrier services can be compromised by a number of events that are out of your control. The threat of service strikes is ever-present, while natural events like heavy weather or COVID-19 have split carriers on what kind of delivery policy is best. FedEx’s network changes and service adjustments in the face of the pandemic differ from those of UPS (though both have suspended their Money-Back Guarantee until further notice), while USPS has its own approach.

There are also peak times, like holidays, to consider when carriers are traditionally swamped with deliveries. Maybe one carrier responds better under that stress by hiring more seasonal workers, deploying more ground/air fleet and so forth.

Using multiple carriers gives shippers a kind of service insurance. If one carrier isn’t delivering where and when required, their competition might. There’s no discernible drawback with this perk unless every carrier sets the same service rules in a crisis or strikes at the same time.

More carriers can also equal more customers. Some businesses may have established accounts with a carrier that provides them with perks and with whom they’re perfectly happy. That’s profit you might lose if you’re tied to a one-carrier model that conflicts with their preference.

Keeping options open is an ace card in negotiations

Sticking to one carrier can have two negative effects:

  1. You’ll be saddled with whatever rate and cost hikes they impose.
  2. If they know you’re not going anywhere, their standard of service may start to slip.

Letting carriers know you’re open to using their competition may drive them to offer more competitive rates when contract renewal rolls around and keep them on their toes when it comes to performance. There is a trade off however. If you split your volume across two or three carriers, you may be giving up additional discounts as opposed to if you do all your shipping with one carrier, as most carriers tend to give better discounts on higher volume.

Nonetheless, the big disadvantage here is having this significant bargaining power but not knowing how to capitalize on it. If you want the best contract possible, you need a comprehensive knowledge of your shipping data (read our previous article for more insight on that) and an understanding of contract negotiation.

Holding more than one carrier accountable for service quality becomes a balancing act when you only have one shipping department. 71lbs can help ease that pressure.

We’ve got the eyes and expertise to manage multiple shippers

Ultimately, it’s not that shippers don’t want the best price and service; they just don’t want the hassle and hard work of staying on top of multiple carriers. 71lbs offers the peace of mind and expertise you need to be sure every carrier is held to the same high standard. We do the hard work for you by scrutinizing their performance across multiple categories and service commitments.

We can help you get the best deal at contract time, and our advanced data analytics simplify your cross-carrier shipping metrics into an easy-to-read format to help you make better business decisions. You’ll be able to compare them all at a glance and see who’s performing best in certain areas and overall.

Each carrier has one or more surcharges tucked into their service agreement that can be a costly surprise when the invoice comes. 71lbs audit more than 65 different shipping surcharges which could be negatively impacting your shipping spend and, with no sign-up costs or ongoing monthly fees, we only get money when you do.

Don’t let managing multiple carriers deter you from the savings you could make. Let us handle that hard work without harming your carrier relationships, while you take care of getting orders to your customers.

At 71lbs, we focus on two things: a) helping customers save money on shipping, and b) helping customers understand their shipping costs. We provide refunds and savings on shipping insurance, freight, and imports, among others. Our automated dashboard displays easy-to-understand shipping costs and insights so you can make better business decisions. Drop by the contact page to get in touch!

Topics: parcel carriers, multi-carrier shipping, negotiation

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