In 2023, about 356 billion packages were shipped worldwide. Each of those packages moved through a vast, complex web of logistics, and shipping carriers are the backbone of that intricate system.

They do more than just pick up and drop off boxes; shipping carriers rely on advanced technology, strategic planning, and intricate networks to keep supply chains running and ensure packages arrive on time.

We’ll discuss how these logistical giants operate, the technology they use for smooth operations, and how to choose the right carrier to support your business’s success.

What are shipping carriers?

A shipping carrier handles the transportation of goods from one location to another. It manages everything from picking up the package to transporting it across various routes and delivering it to the recipient. Shipping carriers are crucial to businesses of all sizes, especially eCommerce, because they ensure products reach customers safely and on time.

Many shipping carriers exist around the globe, but some of the most well known are:

• UPS (United Parcel Service)
• FedEx
• DHL
• USPS (United States Postal Service)
• Amazon Logistics

However, local and regional couriers also play a significant role, particularly for small businesses and niche markets.

Large vs. local carriers

Although shipping carriers of all sizes transport goods from one location to another, they differ in terms of coverage, delivery speed, flexibility, and cost depending on their reach:

• Scale and coverage: Major carriers operate on a national or global scale and have extensive networks that allow them to deliver across large regions. Meanwhile, local carriers operate in a limited area, usually within a single city, state, or region.
• Delivery speed: Their smaller network allows local carriers to provide faster, same-day delivery within a specific area. In contrast, major carriers may have longer delivery times but offer more options, such as economy or express deliveries.
• Customization: Major carriers have standardized services with room for flexibility through different shipping options. For their part, local carriers can provide more personalized services in a way that major carriers cannot, such as specific delivery windows and specialized handling to meet businesses’ unique needs.
• Technology: Major carriers have access to advanced logistics technology, including tracking systems and large transportation fleets. Local carriers might rely on smaller, more flexible operations.

How shipping networks operate

Behind the scenes, shipping carriers work within a carefully coordinated system that ensures your products reach their destinations smoothly and on schedule.

It starts with a complex network comprising hubs, sorting centers, and different modes of transportation. Each piece plays a specific role in guiding your parcel from the time it leaves your hands to when it arrives at your customer’s doorstep.

Hubs

At the heart of a shipping network are these large, centralized facilities that receive, sort, and redistribute packages to their designated addresses. Hubs act as major junctions in the system, consolidating shipments from different locations. Typically, the facilities connect long-distance transportation modes, like planes or trucks, and manage large quantities of inbound and outbound parcels.

Sorting centers

Connected to hubs are sorting centers — smaller facilities where packages are segmented according to delivery location. These centers use automated systems and advanced technology to process thousands of parcels and group them based on geographic zones or delivery timelines.

Methods of transportation

Once sorted, packages are moved using different modes of transportation depending on distance and urgency. Major carriers typically use:

• Planes for long-distance or international shipments that require fast delivery
• Trucks for overland transport across regions or countries
• Ships for large overseas cargo

For local deliveries, shippers rely on vans, bikes, or even couriers on foot for densely populated areas. Each method affects the balance between cost and delivery speed.

The hub-and-spoke system

Most shipping carriers operate under a system wherein a main facility (the “hub”) is connected to smaller, regional centers (the “spoke”). This arrangement allows carriers to route packages through centralized points instead of sending every one directly from sender to recipient. Through the hub-and-spoke approach, carriers can minimize travel distances, optimize routes, and ensure timely deliveries.

For instance, a package shipped from New York to California may pass through one or more regional hubs before it arrives at its final destination. That flow allows carriers to handle the massive volume of packages they process daily.

The final stretch: Last-mile delivery

While the hub-and-spoke system is key to moving packages efficiently, last-mile delivery is the most critical — and often the most challenging — stage. This is the final leg of the product journey, where a package is transported from a regional facility directly to the customer’s door. It’s a crucial process because it directly impacts customer satisfaction, being the point where expectations meet reality.

Challenges like traffic, complex delivery routes, or inaccessible locations can cause delays, making this stage both time-consuming and costly for carriers. To address these issues, they invest in route optimization technology and local delivery networks to ensure packages arrive on time.

Technology in shipping networks

With so many steps in the product journey, keeping everything on track can be challenging. But robust shipping technology creates a system that can handle all of that smoothly and efficiently, making the entire process seamless.

Shipping automation and carrier selection

Shipping automation eliminates the hassle of choosing a carrier by automatically comparing multiple options and selecting the best one based on cost, speed, or customer preference.

Additionally, as orders grow, automation keeps everything running smoothly without extra effort. If there are delays or price changes, it quickly switches carriers so operations remain flexible and cost-effective.

Logistics software

Whether across town or to another country, efficiently sending your products to their final destination is no small feat.

That’s where logistics software helps. It optimizes delivery routes by analyzing traffic, weather, and stops to save time and fuel. It’s like a smart GPS that reroutes shipment travel around obstacles to keep deliveries on schedule. For your business, this translates to fewer delays, no missed deadlines, and happier customers.

Real-time tracking

Real-time tracking allows customers to follow their package from the moment it leaves your warehouse to the second it lands on their doorstep. If there’s a delay, they can receive an alert and adjust their timeline expectations. Real-time tracking keeps customers informed, reduces frustration, and makes them feel like they’re involved in the process.

Shipping network trends

From automation and live tracking to sustainable delivery options, shipping carriers are adopting new technologies and strategies for more reliable service. Some current trends in shipping networks include:

• Green initiatives: Many carriers are embracing eco-friendly practices like using electric vehicles and optimizing delivery routes to reduce fuel consumption. They’re also cutting back on their use of plastic by switching to recyclable and biodegradable packaging materials.
• Automation: Shipping and logistics companies are incorporating automation into their warehouses and fulfillment centers to streamline operations, cut labor costs, and improve efficiency. Robotic picking and packing solutions have also made improvements in warehouse and distribution centers.
• Data-driven logistics: Shipping networks leverage AI to predict the best delivery routes. Through dynamic route planning, they can optimize travel times and reduce costs. Advanced tracking technology provides real-time package location updates as well, which lets businesses and consumers monitor shipments at every step.
• Flexible delivery options: Consumers can now select specific delivery days and times that fit their schedules, leading to more customer-friendly shipping options. In some cases, carriers have set up package lockers and designated pickup stations so buyers can retrieve their orders at their convenience.

How to choose the right shipping carrier for your business

The shipper you select will significantly impact your operations and customer satisfaction, so be diligent in your search. When looking for the best carrier for your business, keep in mind the following factors:

• Shipping needs: Assess your shipping volume to determine whether you need a carrier that can handle high volumes or one that focuses on smaller shipments.
• Pricing: Check the pricing models of different carriers, including flat rates, weight-based rates, dimensional weight pricing, and additional fees. Ensure the carrier can also meet your budget for delivery spend.
• Technology: Look for robust tracking systems so you and your customers can easily monitor shipments. You want ones that can easily integrate into your eCommerce platform and inventory management systems for streamlined operations.
• Area coverage: Major carriers often possess extensive networks and reliability, while local carriers may offer specialized services and a personal touch. Depending on your needs, you might consider a mix.
• Reliability and speed: Research each carrier’s reputation for reliability, delivery speed, and customer service. Read customer reviews and testimonials to gauge their performance.

Wrapping up — Discover the best shipping solution with MyFBAPrep

Shipping carriers are the silent heroes of eCommerce. They work behind the scenes to ensure your products reach customers quickly and efficiently. As the online shopping industry grows, these carriers continue to adapt to keep up, whether through automation, sustainable shipping practices, or the latest technology.

Want to find the best shipping solution for your business? Send us a message, and we’ll help you pinpoint shipping options that’ll keep your operations running smoothly.