Shipping Zones: How To Reduce Costs & Save Time
by Jaidyn Farar
Parcel shipping has never been more complex or costly. To maintain profits, ecommerce businesses need to get strategic about shipping, taking advantage of tips and tricks to find the best rates.
Understanding how shipping zones work is the perfect place to get started!
This article will define shipping zones, explain how to calculate the zone you’re shipping to, and review some tried-and-true strategies to save on shipping.
What are shipping zones?
Shipping zones are geographical areas used by carriers to set their rates and provide estimated delivery times. Zones aren’t determined by miles; instead, carriers use groupings of zip codes to determine how far packages are traveling.
Zones begin at Zone 1, the package’s origin, and go up from there, with Zone 8 being the furthest distance you can ship in the United States (Zone 9 is for U.S. Territories and Freely Associated States).
A greater distance between a package’s origin and destination means a higher zone and a higher shipping cost. Similarly, higher zones often mean longer transit times.
Why you need to understand shipping zones
Understanding shipping zones helps you make better shipping decisions.
At first, it may seem like you can’t do anything to affect shipping zones. After all, if a customer in New York orders a package, you can’t ship it to Iowa just because it’s a cheaper zone. However, you can get strategic about warehouse locations, shipping strategies, and more. In addition to saving money, this can lead to faster deliveries and greater customer satisfaction.
Later in the article, we’ll walk through some specific ways to use your understanding of zones to your advantage; see the section “How to reduce shipping costs.”
How to determine your shipping zone
To determine a shipping zone, you need two pieces of information: the origin zip code and the destination zip code. You’ll also need access to your carrier’s zone calculator tool; we’ve linked to USPS, UPS, and FedEx below. From there, calculating your zone is simple—all you have to do is enter both zip codes into the calculator.
Now that you know your shipping zone, you can estimate shipping costs based on a package’s weight.
For example, let’s say you’re shipping a three-pound package from Pheonix, Arizona (zip code 85034) to Brooklyn, New York (zip code 11230) using USPS Priority Mail®.
When we plug our two zip codes into USPS’s calculator, it shows that it’s a Zone 8 shipment. A quick glance at the USPS price sheet reveals that shipping a three-pound package to Zone 8 with Priority Mail will cost $23.95 with Retail rates.
What are the shipping zones for USPS, UPS, and FedEx?
Shipping zones in the U.S. aren’t exactly the same from carrier to carrier, but they tend to follow the pattern found in the table below.
Zone | Mile radius (from origin) |
|---|---|
1 | 50 miles |
2 | 51-150 miles |
3 | 151-300 miles |
4 | 301-600 miles |
5 | 601-1,000 miles |
6 | 1,001-1,400 miles |
7 | 1,401–1,800 miles |
8 | 1,801+ miles |
9 | U.S. territories and freely associated states |
How zone and package weight impact shipping costs
As package weight increases, the cost to ship to a higher zone rises more dramatically. For example, the cost difference* between shipping a one-pound package to Zone 1 and Zone 8 is $4.90, while the difference between shipping a three-pound package to Zone 1 and Zone 8 is $13.00.
The takeaway? When planning your shipping budget, you need to account for both zone and package weight.
Weight (pounds) | Zone 1 | Zone 2 | Zone 3 | Zone 4 | Zone 5 | Zone 6 | Zone 7 | Zone 8 | Zone 9 |
|---|---|---|---|---|---|---|---|---|---|
1 | $9.35 | $9.60 | $9.70 | $9.90 | $11.00 | $12.05 | $13.10 | $14.25 | $28.80 |
2 | $10.50 | $11.10 | $11.80 | $12.65 | $14.85 | $16.00 | $17.15 | $18.95 | $38.25 |
3 | $10.95 | $11.70 | $12.30 | $13.35 | $15.95 | $18.55 | $21.10 | $23.95 | $48.35 |
*Retail rates to ship with USPS Priority Mail.
How to reduce shipping costs
Are high shipping zones driving up your rates? Fortunately, you have several different options for reducing shipping costs. Let’s take a look at four of them.
1. Distribute your inventory
If your inventory is stored in warehouses located far away from where customers live, you’ll have to pay a premium to fulfill orders. Distributing your inventory means storing products in strategic locations across the country to keep shipping zones (and costs) low.
To get started, analyze your purchase history to determine where customers tend to be located. Then house inventory near those locations so you can ship quickly and affordably to a majority of your buyers.
Since it’s unlikely that your customers will be grouped in a single geographic area, the most effective inventory distribution strategy will likely be to open several fulfillment centers (or rent warehouse space) across the country.
When businesses are interested in distributing their inventory but don’t want to invest in new fulfillment centers, they sometimes partner with a third-party logistics providers to leverage their existing infrastructure.
2. Consolidate orders
Businesses often use package consolidation to skip zones and reduce shipping costs.
Rather than sending individual parcels to the same region, they group them together (consolidation) and ship them all as a single freight load. Once the shipment arrives in the region, parcels are deconsoliated and sent for last-mile delivery.
Since shipping a consolidated order is generally less expensive than shipping individual packages over large distances, this can be a great way to save on last-mile delivery costs and even cut transit times.
3. Use flat-rate shipping
Depending on the carrier you use, flat-rate shipping can be a great way to save money when shipping long distances. Although some flat-rate shipping services take zone into account, others cost the same no matter what zone you’re shipping to.
Flat-rate shipping is especially helpful for sending dense, heavy items because it doesn’t take a package’s weight into account.
4. Get discounts with shipping software
Negotiating with carriers can help you reduce rates. But because it’s time-consuing and costly to begin shipping with with a new carrier, many businesses only partner with one or two, leaving potential savings opportunities on the table.
On the other hand, shipping software like EasyPost allows you to quickly integrate with your choice of over 100 carriers. You can access built-in rate discounts for major carriers like USPS, UPS, and FedEx, saaving money without needing to go through long negotiation processes.
In addition to providing automatic discounts, shipping software also helps you save money by making it easy to ship with regional and local carriers, which often offer lower prices than national ones.
And with AI tools like Luma, you can easily determine the most cost-effective shipping method for every package you send based on historical shipment data.
How can ecommerce businesses offer free shipping?
Is it possible to offer free shipping without losing money? Yes! The three methods below help merchants balance customer satisfaction with profitability.
- Include the shipping cost in product prices. Simply determine your average shipping cost, and add it to your product prices. This strategy makes things simple for buyers; they can fill their shopping cart and track their spending without needing to leave room in the budget for additional shipping fees.
- Establish a purchase threshold. Many companies offer free shipping for orders above a certain threshold. For example, you might provide free shipping if a customer spends over $50. This is a great way to increase your average order value, incentivizing customers to add more to their cart to access free shipping.
- Reduce the zones you ship to. Use distributed inventory or consolidated shipping (both discussed above) to ship to lower zones. When you save on shipping, it becomes more realistic to handle shipping costs yourself instead of requiring customers to pay.
Ship to any zone with EasyPost
Whether you’re shipping to Zone 1 or Zone 9, EasyPost makes things simple. With industry-leading uptime, the EasyPost Shipping API automates carrier integration and selection, label generation, address verification, package tracking, and more. It helps businesses of all sizes save money, ship smarter, and keep customers happy with reliable deliveries.
Learn more or sign up for free to get started.