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Shipping Software Solutions

In 2000, there were three primary shipping software solutions available in the market. Today, there are over 50 different shipping software solutions. With a saturation of vendors offering shipping software, how does a company decide on one? And how do they pick the best shipping software?

Here are some of the basic areas that should be considered when shopping the competition and various shipping software solutions:

On-Premise versus SaaS (Software as a Service)

On-premise is traditional software that is installed on a piece of hardware behind a customer’s firewall and is accessed through the private network. Typically on-premise software is sold as a one-time (perpetual) license with an annual maintenance fee for software updates and support. For many companies this is preferred because they have the infrastructure (i.e. data center) and IT team to support it.

SaaS (Software as a Service) is most often associated with cloud computing. The SaaS model is typically licensed on a subscription basis (monthly or transactional) and is centrally hosted. One of the greatest benefits to organizations for SaaS solutions is not having to manage and support it. The subscription fee usually includes a premium that covers maintenance and support.

About one third of the shipping software solutions on the market today are available as SaaS. However, on-premise software can also be a hosted solution and follow the SaaS model. There are many companies that provide hosting services. Hosting companies offer a wide range of options from providing dedicated servers (physical and virtual) to even hosting your own server. This can offer the best of both worlds.

Technically speaking, a company that has a data center where software is installed and the software is accessed via a thin client like a web browser, this is considered SaaS.

The decision should boil down to the 1.) cost: on-premise will have a larger upfront investment but be mindful that SaaS can cost more over time 2.) support: if your company has IT personnel that can support on-premise software 3.) performance: on-premise software still wins in this category.

Per User or Per Transaction Fees

Sometimes hidden fees can drive the price up on software. It is important to understand if the shipping software solution you are purchasing offers unlimited users or if you pay a license fee for each user accessing the software. If there is a per user fee, find out if it is concurrent users or named users. Named users can get very expensive when you want to give access to more employees.

Also per transaction fees or tiered fees may not be shown upfront or discussed. Depending on your volume, you may have to pay more as your company grows and your volume of shipping increases. The software price may be based on “up to ### transactions”, once you exceed this number you will move into a different tier and have to pay more.


It may be appealing if a company offers 24/7 support automatically with the purchase of the shipping software. However, does your company really require 24/7 support? For many companies, they have one shift that operates the shipping department and only need support during standard business hours Monday through Friday. And for the occasions where your company may need extended support during a peak shipping period (i.e. holiday season, quarter end, yearly end), it may be better to purchase this separately. Or in the beginning you may consider paying for 24/7 support for the first 90-days and then move to a standard support plan once all the bugs are worked out and everything is running 100% smoothly.

For companies that have shipping facilities on both ends of the coast where they operate from 8 AM EST to 5 PM PST, they may just consider adding support at the end of the day when it is crunch time and more critical to get support. The beginning of the day in a warehouse may consist of the pick/pack process and shipping does not get started until a couple hours later. And if there is a problem, it may be able to wait until the support window is in effect.

Support for your shipping software solution is very important considering shipping software for most companies is considered “business critical”. It is worthwhile to work with the vendor and tailor your support around your true needs.