Shipping costs continue to rise in 2025—and it’s not just due to rate increases. Carriers are introducing new surcharges, shifting service guarantees, and applying complex fees that can erode your margins rapidly. Considering these shifts, Carrier contract optimization is no longer a tactical advantage—it’s a strategic necessity.
Meanwhile, parcel volume is accelerating. According to Insider Intelligence, U.S. retail e-commerce sales are projected to reach $1.3 trillion by 2025, an 8.6% increase from the previous year. More online orders mean more shipments, heightened competition, and more pressure on your bottom line.
Here’s the good news:
You have more leverage than you think. With the right approach and tools, you can reduce parcel shipping costs, strengthen your carrier contract negotiations, and implement shipping cost optimization strategies to drive long-term savings.
5 Proven Strategies for Carrier contract optimization
These strategies will reveal how to optimize carrier contracts to improve terms, reduce shipping costs, and strengthen your bottom line.
1. Understanding Your Shipping Profile
Before reviewing or negotiating any agreement, start with a clear picture of your shipping behavior. That includes:
- Total parcel volume by month or season
- Common service levels used (Ground, 2-Day, etc.)
- Package weights, dimensions, and average costs
- Key destinations and zones
- Common surcharges (e.g., residential or delivery area fees)
This data forms the foundation of your leverage. Carriers design pricing based on how your shipping patterns affect their operations. The more insight you have, the better positioned you are to negotiate—or optimize—your contract.
Tip: Want to dive deeper into how data can drive savings? Check out our post on 5 Ways to Improve Profits with Parcel Spend Management.
2. Turn Your Data into a Strategic Asset
Your shipping data hold the keys to unlocking cost savings, but only if you know where to look. Analyzing past performance can uncover:
- Overuse of premium services
- Hidden accessorial fees
- Delivery delays or service failures
- Carrier mix inefficiencies
Use this information to identify areas for improvement or build a case for better terms. Carriers respond to facts—especially when you can demonstrate opportunities for mutual efficiency.
Tip: A platform like TransImpact’s Parcel Spend Intelligence makes it easier to access and interpret this data, so you can act with confidence.
3. Build a Holistic Strategy—Not Just a Rate Request
Successful contract management goes beyond chasing discounts. It requires a well-thought-out plan. Consider:
- Ideal service levels and pricing targets
- Contract timelines and renewal windows
- Surcharge thresholds or DIM weight adjustments
- Carrier performance standards and SLAs
- Walkaway terms if no agreement is reached
Bring in stakeholders from operations, finance, and procurement early in the process. Aligning priorities ensures you’re not just negotiating a better contract—you’re solving real business challenges.
4. Use Technology and Experts to Your Advantage
Carrier contracts are complex—and often intentionally so. Working with an experienced partner can expose hidden fees, benchmark your rates, and unlock savings that aren’t obvious on the surface.
Experts like TransImpact specialize in optimizing parcel spend. Our technology and team can help you:
- Compare your rates to market benchmarks
- Identify negotiation opportunities
- Run contract scenarios to forecast impacts
- Navigate tricky contract language and pricing structures
Whether you need support or full-service negotiation, the right expertise can deliver faster ROI and reduce risk.
Tip: Considering outside support for parcel contract optimization? Don’t miss our guide on 5 Risks to Consider for Parcel Spend Management in 2025.
5. Think Beyond the Rates
A low rate doesn’t guarantee long-term value. Consider the bigger picture when evaluating or negotiating contracts:
- Can your carrier scale with peak volume?
- Do you receive credits for late deliveries?
- How flexible are they with service disruptions?
- Are reporting tools and data visibility included?
- Can you cap certain fees or negotiate waivers?
A strong carrier partnership includes performance guarantees, transparent communication, and tools that help you manage shipping proactively—not just reactively.
Make Carrier Contract Management a Continuous Strategy
Carrier contracts shouldn’t be “set it and forget it.” Between rate increases, policy shifts, and evolving service models, your agreement should be reviewed at least annually.
Carrier contract optimization works best when it’s part of a structured, ongoing carrier contract management approach. That includes regular audits, renegotiation triggers, and performance reviews throughout the year.
At TransImpact, we’ve helped clients save over $1 billion by transforming how they manage parcel spend. With the right tools and guidance, you can build shipping contracts that support both cost control and operational flexibility.
Ready to take control of your shipping costs in 2025? Start by strengthening your carrier agreements—with help from TransImpact.