Commercial Versus Residential Parcel Shipping

by | Apr 19, 2022 | Parcel

While the basics of parcel shipping remain the same for both residential and commercial parcel shipments, there are a few significant differences.


Whether it’s a business or individual shipping a package to a residence, residential deliveries are typically more expensive. There’s a more direct cost associated with residential deliveries because large shipping carriers consolidate trucks for business routes. Residential drivers have to make more stops, sometimes further out of the way for only a few small deliveries, increasing fuel costs. Business deliveries are less expensive due to the fact that business districts are typically more geographically consolidated.

Parcel Carrier Agreements

Large companies that ship many small packages per week are able to negotiate custom parcel agreements with carriers. These agreements afford those companies special discounts not available to the general public.

If you’re a small business that doesn’t yet have the volume to justify a parcel carrier agreement, there are a few things you can do to help keep shipping costs down.

  1. Look for Flat Rate Options

Many shipping companies offer some sort of flat-rate option for your shipping needs. If, for example, you have a fairly common item you ship often, or a small item, or a series of documents, these may be good candidates for flat rate shipping. Typically, flat rate shipping is easier and less expensive. Flat rate shipments typically have size limitations, though, so be sure to inquire with your preferred shipper prior to shipping flat rate.

  1. Rate Shop

Like anything else you’d buy, looking around for the best price when it comes to parcel shipping is a good idea. Thanks to the Internet, a few quick keystrokes will allow you to compare rates and find the one that’s best for you.

  1. Don’t Forget Regional Carriers

When rate shopping, don’t forget to look at regional carriers. They can sometimes offer lower-cost alternatives. However, be cautious as regional carriers may be limited in their delivery range.

  1. Get Friendly

Another way to keep costs down is to make friends with your carrier representatives. It is the representatives’ job to make negotiations and answer questions and help you through the shipping process.

If your company is one that ships a large volume of parcels daily or weekly, consider speaking with a third-party expert about parcel carrier agreements. If you have an existing parcel carrier agreement, you should be utilizing the services of a third-party auditing service to ensure you’re not being overbilled and are receiving the best discounts available.

Amware has extensive experience and knowledge in negotiating advantageous parcel agreements for clients. If your business is considering a custom parcel agreement or you have one in place that you’d like reviewed, CONTACT us today and let one of our parcel experts help.


About Dan Ramella

About Dan Ramella

Dan Ramella is a member of Amware's executive team, helping drive growth and manage key relationships. With over 20-years experience in the transportation and logistics industry, Dan has helped Amware become one of Northeast Ohio's premier 3PLs