Case Study

Canadian Healthcare Shipping Optimization: 40% Cost Reduction

INDUSTRY

Healthcare

Location

Montréal, Québec

Platform Used

Shipstation

Carriers Before

FedEx (Express), Canada Post (Self-Managed)

Monthly Shipments

Over 1000

Total Savings

40%

Implementation Time

7 Days

Optimized Carrier Mix After

Purolator, Canpar, Local Carrier, FedEx (Commercial Contracts)

Why Healthcare Businesses Struggle with Shipping Costs

Canadian healthcare businesses face significant shipping challenges that cut deep into profit margins. Research shows that 58% of small businesses cite shipping expenses as a major hurdle to profitability¹, with 84% of small merchants reporting that higher shipping rates have squeezed their profit margins².

The numbers are stark. Shipping a 2 kg parcel from British Columbia to Ontario costs around $57 with standard courier rates³. For healthcare suppliers shipping dozens of orders weekly, annual shipping expenses easily reach tens of thousands of dollars.

"The savings were real—and we didn't have to hire or rework anything." — Head of Fulfillment, Healthcare eCommerce Retailer

Healthcare Industry Shipping Challenges

Healthcare businesses face unique obstacles beyond typical e-commerce shipping:

Geographic coverage requirements: Serving remote areas where FedEx’s “Extended Area” surcharge costs at least $117 per shipment⁴
Dimensional weight pricing impact: Changes increased shipping charges by an estimated 30% for many packages⁵, hitting bulky medical devices and PPE hard
Time-sensitive deliveries: Health products often require expedited service, driving up costs
Regulatory compliance: Health Canada shipping requirements add complexity

Customer expectations: 43% of online shoppers say reliable delivery is essential to a positive purchase experience⁶

The Challenge: Montréal Healthcare Retailer

This fast-growing healthcare retailer was scaling nationally, but shipping costs were scaling faster. They relied on FedEx Express and Canada Post through standard small business accounts.

The core problems:

Paying premium express rates on every shipment
No regional carrier strategy for cost control
Limited support through standard small business customer service
Shipping costs consuming roughly 10% of revenue (typical for e-commerce businesses)
Margin erosion as volume increased

Even with ShipStation properly configured, they lacked the volume to negotiate better rates independently. Like 75% of small businesses that don’t use dedicated shipping management solutions⁷, they were managing carrier relationships manually.

"We didn't have to change how we ship—just who we ship with."

The Solution: Collective Buying Power Strategy

We implemented a pooled contract strategy through Part n Parcel’s network of 240+ Canadian businesses. This gave them access to enterprise-level commercial rates across multiple carriers without changing their existing ShipStation workflow.

What Changed

Multi-carrier optimization: Introduced Purolator, Canpar, and local carriers for regional deliveries
Strategic FedEx usage: Reserved express service only for rural areas and time-sensitive shipments
Direct carrier accounts: Bypassed reseller markups with true commercial contracts
Enterprise support access: Direct carrier representative relationships, avoiding call center queues
Automated routing: Configured ShipStation to select optimal carriers automatically

Healthcare Industry Context

Growing E-Commerce Demand

Canada’s healthcare e-commerce sector is expanding rapidly. Healthcare retail saw 8.6% growth in 2023¹⁰, driven by consumers comfortable ordering health products online after pandemic adoption.

Over 27 million Canadians (75% of the population) made online purchases in 2022¹¹, with this base expected to reach 77.6% by 2025. Healthcare businesses shipping nationwide need logistics solutions that scale with this growth.

Shipping Cost Reality for Healthcare SMBs

The data shows why shipping optimization matters for healthcare businesses:

Volume disadvantage: SMBs pay 40-50% higher rates per parcel than enterprise shippers¹²
Rising costs: Carriers implement 4-5% annual rate increases¹³, with recent spikes due to fuel and pandemic disruptions
Cross-border complexity: 32.2% of Canadian exporters reported shipping costs as a barrier in 2022, up from 18.8% in 2019¹⁴

Who This Approach Works For

Ideal healthcare businesses:

Ship $10,000+ annually (approximately 1,000 shipments)
Use platforms like ShipStation or similar systems
Serve customers across Canada
Want to focus on healthcare expertise, not logistics management
Currently pay standard or public platform rates

Results depend on current setup:

Businesses using only premium express services see highest savings
Companies shipping to remote areas benefit from expanded carrier options
Those managing carrier relationships manually gain significant time savings

Why the 7-Day Implementation Worked

The rapid implementation was possible because:

No platform changes required: ShipStation integration maintained existing workflows
Direct carrier setup: Part n Parcel’s established relationships enabled quick account activation
Proven automation rules: Best practices from 240+ member companies applied immediately
One-hour training: ShipStation’s dedicated support combined with Part n Parcel optimization guidance

Measureable Results

Financial Impact

Operational

Faster delivery in Québec and Ontario through regional carriers
Reduced cart abandonment with better delivery options (important since 55% of shoppers abandon carts due to shipping costs⁸)
Simplified fulfillment through automated carrier selection
Enterprise-level support access typically reserved for high-volume shippers

Customer Experience

References

OrderCup – Top 6 Shipping Challenges for SMBs: https://ordercup.com/wp-content/uploads/2025/04/top-6-shipping-challenges-for-smbs.pdf
OrderCup – Top 6 Shipping Challenges for SMBs: https://ordercup.com/wp-content/uploads/2025/04/top-6-shipping-challenges-for-smbs.pdf
Ship Expert – Small Business Shipping Cost Guide: https://shipexpert.com/blog/small-business-shipping-cost/
FedEx Canada – Rate Changes: https://www.fedex.com/en-ca/rate-changes.html
[PART n PARCEL ARTICLE ON DIMENSIONAL WEIGHT]
OrderCup – Top 6 Shipping Challenges for SMBs: https://ordercup.com/wp-content/uploads/2025/04/top-6-shipping-challenges-for-smbs.pdf
Logistics Viewpoints – SMB Logistics Management Challenges: https://logisticsviewpoints.com/2013/05/16/guest-commentary-logistics-management-challenges-for-smbs/
Dynamic Yield – Cart Abandonment Benchmarks: https://marketing.dynamicyield.com/benchmarks/cart-abandonment-rate/
OrderCup – Top 6 Shipping Challenges for SMBs: https://ordercup.com/wp-content/uploads/2025/04/top-6-shipping-challenges-for-smbs.pdf
Statistics Canada – Retail Trade December 2023: https://www150.statcan.gc.ca/n1/daily-quotidien/240222/dq240222a-eng.htm
Trade.gov – Canada eCommerce Guide: https://www.trade.gov/country-commercial-guides/canada-ecommerce
Key Differences of Payments for Small Businesses vs. Enterprises https://www.clearlypayments.com/blog/key-differences-of-payments-for-small-businesses-vs-enterprises/
Statistics Canada – Package Delivery Costs: https://www.statcan.gc.ca/o1/en/plus/6497-more-canadians-delivering-packages-costs-slowing

Statistics Canada – Export Barriers Report: https://www150.statcan.gc.ca/n1/daily-quotidien/240731/cg-b002-png-eng.htm

Getting Started with Healthcare Shipping Optimization

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