Procurement

Learn how to navigate the ongoing discussion of Price vs. Value in multi-carrier shipping software

Though we may feel like we are out of the woods, supply chain uncertainty still leaves things up in the air for many shippers. E-commerce orders are slowing, costs of goods and raw materials are still high, fuel is expensive, inflation is still a concern, carriers are consistently passing on record GRI’s, and profit margins are shrinking.

These numerous and ongoing pain points for shippers in today’s market have resulted in skewed evaluations for buying decisions for new shipping software. We used to prioritize solutions that aligned with our growing business and shipping needs. Now, the focus is on finding the cheapest option to quickly cover the basics.

It’s no surprise that price remains a crucial factor when choosing a shipping solution. However, this article will break down some of the long-term considerations when choosing a multi-carrier shipping solution.

Long Term Considerations for Choosing Shipping Software

When selecting the right shipping software for your business, numerous factors come into play. These include evaluating options like a transportation management system (TMS) versus a multi-carrier shipping software solution. Additionally, you must assess whether each solution can handle the finer nuances of parcel shipping, including omnichannel fulfillment, supply chain e-commerce and reverse logistics. Read on to view the details on the top 4 things to consider when choosing a new shipping software solution.

Consideration #1 - Stability of the Company

The software company that you’re buying from is here today, but will they be there tomorrow?

There has been a significant consolidation of shipping software companies in the marketplace over the past few years. We’ve observed venture capitalists support and develop brands only to sell them later. This leaves the future in limbo for those products and the people who built the software’s success. Potential issues that could arise…

• Your support needs have been moved long distance, encountering major delays in issue resolution. Or even worse, non-existent and your IT team must handle support and necessary updates.
• The merging of multiple vendors and technologies causes resources to be split - you haven’t seen a product update in years and your current product may become obsolete.
• Instead of using carrier certified engines, web services (APIs) communicate to the carriers, often requiring downtime for updates and slowing shipping execution times.

Choose a company that focuses their efforts on parcel shipping.

Another consideration is the focus of the company from which you are buying the software. Are they focused on your need or is this just one of the many offerings they have AKA are they a “jack-of-all-trades, master of none”? In this case, it rings true to purchase multi-carrier shipping software from a company focused on parcel shipping software, and not from a company with a Warehouse Management System (WMS), Order Management System (OMS), or Enterprise Resource Planning (ERP system) as their main product.

Consideration #2 - Versionless (non-sunsetting) Software

What’s the shelf-life of the multi-carrier shipping software you’re buying?

This consideration ties into some recent headlines in the shipping software market. We’ve seen companies that have a history of sunsetting their software and discontinuing support for certain versions. This is often because resources are spread too thin between products. The average life of a non-CI/CD (continuous improvement/continuous deployment) multi-carrier shipping software can range anywhere from 3-7 years, forcing companies into any version of bleak scenarios…

• They must self-support the software they bought with their own IT team.
• They must go through the painstaking process of searching for a new option.
• They are forced into spending money to buy the “newest” version of the product they own.

Additional risks of choosing versioned solutions and solutions that risk sunsetting.

Other issues to watch out for are non-compliance with carriers, incurring shipments put on hold and charge backs, or having to resolve system failures. Finding an option that provides continuous improvements and continuous deployments through a version-less software ensures you have access to the updates and upgrades you need, when you need them, and are not paying a small fortune for them.

Consideration #3 - Feature-Rich, Robustness

What type of shipping software feature set does your business need today to drive efficiency and cost savings?

It’s important to think about features that are helpful now as well as consider additional features that you can use as your needs evolve. For instance, package delivery becomes more critical (especially within e-commerce) as throughput increases. Basic published transit time may not cut it, especially during the holiday season.

Advanced Date Shopping (a state-of-the-art form of carrier rate shopping) can provide the most efficient shipping method. This unique feature keeps your transportation spend in mind, while also considering a carrier’s holiday schedules, trailer pull times, weekend travel, and other special conditions which other rate shopping tools may not. [Learn more about ProShip’s Advanced Date Shopping.]

This can also apply to address correction or residential fees. Utilizing a Coding Accuracy Support System (CASS) certified address validation service can help to reduce those types of issues, and at the same time, relieve the stress this causes other departments affected by incorrect address issues, for example customer service or success, operations, and accounting.

Creating a positive customer experience with robust shipping software.

As operations grow and additional locations are established, will your software give you options to pick the most cost and transit efficient location from which to ship? Having a shipping software that allows you to select the best option to ship from (Distribution Center, Fulfillment Center, or Store) based off inventory, shipping cost, and transit time to the customer boosts the Customer Experience CX) by delivering products in the timeliest fashion, all while reducing your shipping costs. All this builds brand loyalty even further.

Consideration #4 - Flexibility/Ability to Scale

How long does it take during peak season to rate a shipment and then print a label – and does this take into account any business rules? 

Sure, a parcel carriers' API can often keep up with lower, non-peak season volumes. However, if you’re shipping high volumes, like many are during peak-season, you need a solution that isn’t 100% carrier API dependent. Web only solutions cannot force a carrier API to move faster – API speed is controlled by the shipping carrier’s system and internet performance. For many high-volume shippers, having some form of a premisable solution can help keep high volume moving even during those busy months.

Future-proof your parcel shipping strategy with a parcel solution that keeps up with your company's growth plans.

Another thing to consider is that as your business grows, so does the complexity of the supply chain and the business logic that goes with it. To help with the complexity, you will need to take into account the different shipping process variations and business rules tied into each individual shipment and ensure that the shipping software can adequately scale with that complexity. Typically, API-aggregators will not have any improved functionality, other than a basic call to the carrier, and it’s essential to have a solid partner to help build a stable yet flexible shipping solution based on your business needs today, and as you grow.

Finding the Right Parcel Shipping Software Partner

At the end of the day, you need to choose the parcel shipping solution that’s best for your business. This may be an obvious statement, but it becomes more difficult when different parts of the business provide input into the decision-making process and ask how it will affect them [Discover more about how ProShip alleviates peak shipping pain points]. For example,

• Finance and Accounting: These departments care about the cost (now and in the future) of the product and how it fits into the budget, plus they want to understand the real ROI on their investment. Finally, how do you factor in the intangibles?
• Supply Chain: The supply chain team wants to understand how a solution will allow them to potentially shift available labor to more meaningful tasks. Their need is based around allowing their workers to do “more with less” and what tasks can become streamlined along with connecting to automation in the facility.
• IT: The information technology departments will want to consider the type of resources needed to implement this solution and then also the maintenance of the software year-over-year.
• C-Suite: The executive team cares about profitability. They want to see that the shipping solution can cut shipping costs to enable revenue growth and repeat customers.
• E-Commerce: The e-commerce team wants to find ways to improve cart abandonment. Expensive shipping costs and lack of shipping options will not help their cause. A solution that can boost conversion rates, not to mention compete with e-commerce giants like Amazon, will help these decision-makers approve of the right shipping solution.

No company wants to experience buyer’s remorse, especially for a supply chain solution so crucial to the success of your business. Many companies may later find out that they do not have the budget for a different shipping solution when they realize their mistake. The bottom line is, before you sign the dotted line based solely on price for that next purchase, ensure you do the following: Have an honest discussion with all departments about what the business needs now, and most importantly, to find success as you grow.

Find out why ProShip is the #1 enterprise solution for multi-carrier shipping software.

Want to learn more about finding shipping success with ProShip’s industry-leading parcel shipping solution? Contact our expert team and learn more about the long-term value that ProShip’s multi-carrier shipping software can bring to your business.

About the Author

Rob Murphy is in Business Development at ProShip, where he works with prospects to uncover the right fit for their shipping needs. Rob's proactive approach and friendly demeanor have helped him find success generating new opportunities and qualifying prospects with in-depth conversations about current pain points and future shipping goals. Rob is excited to learn more about the supply chain and logistics community as he attends industry events and connects with experts and leaders to expand his network. Rob currently resides in the Milwaukee area and enjoys fishing, gardening, and spending time outdoors.