$31.7 Million Saved: Inside a Global Distributor’s Parcel Shipping Transformation

LJM transformed this shipper’s parcel operations from reactive cost management to proactive intelligence. The engagement combined multiple tactics – contract strategy, parcel invoice audits, operational optimization, and data visibility – into a single, integrated system. The result was a shift from isolated cost-cutting to continuous performance improvement for smarter, more resilient shipping operations.

Strategic Shipping Contract Negotiation and Network Realignment

LJM’s Executive Shipping Advisory led multi-round negotiations with a top international carrier and two leading domestic carriers, rebalancing volume toward higher-performing networks while improving incentives across zones and service types. The new agreements aligned discounts to actual utilization and eliminated outdated surcharge structures that had eroded margins. Further, strategic negotiations with domestic parcel carriers helped align shipping strategy with business strategy. For example, negotiations helped to improve overnight service performance and pricing in strategic markets like Florida and California. 

Invoice Audit Insights that Drive Strategy

Invoice audits immediately identified millions in savings due to Voids, Residential Adjustments, Service Refunds, and more. However, weekly audits went beyond error recovery. By tracking shifts in declared value, fuel surcharge rates, and rebate application, the audits became an early-warning system for inefficiencies. One audit cycle revealed a steady increase in declared value charges, prompting a deeper investigation that uncovered opportunities for multiweight consolidation and packaging updates.

Operational Efficiencies and Real-Time Parcel Intelligence

Working with the distributor’s operations and payables teams, LJM established automated data alerts to flag potential cost anomalies, from avoidable late-payment fees to service misclassifications. Real-time dashboards now provide instant visibility into trends in spend, utilization, and surcharge exposure, allowing internal teams to act before small issues escalate.

Strategic Edge: Executive Shipping Advisory Uncovers Multiweight Opportunity

LJM’s analysis uncovered a major opportunity hidden in the client’s daily shipping data. By reviewing thousands of single shipments ordered and shipped on the same day from the same origin to the same destination, LJM found that many could have qualified for multiweight (MWT) pricing if they had been processed as a single combined shipment.

The review exposed packages billed at 50 pounds despite having an actual weight of just one pound, a clear sign of missed savings. LJM recommended updates to the client’s warehouse software so it could automatically recognize and flag multiweight opportunities. These system improvements allow shipments to be consolidated before tender, ensuring accurate billing and significant cost reduction.

Over 17 months, LJM delivered measurable, sustained savings:

• $31.7 million in contract savings (May 2024–October 2025), the equivalent of nearly $1.9 million per month in savings! 
• Service-level and operational improvements through packaging and charge reduction guidance
• Multiweight pricing opportunities identified for continued long-term savings

Beyond the immediate financial impact, the company gained an integrated view of shipping performance through LJM’s Parcel Intelligence Platform, aligning cost control with operational efficiency.

Result

Through a combination of expert negotiation, data-driven analysis, and operational refinement, this powersports distributor achieved significant cost reduction and improved shipping strategy across its global network. With this parcel intelligence system now integrated into the client’s existing workflows, the partnership continues to generate new savings opportunities through more granular rate shopping, market-optimized carrier strategies for DHL, FedEx and UPS, and insights to support future rate negotiations and operational decisions.

‍See how much LJM can save your business on shipping costs with a commitment-free complimentary contract analysis.