This article is part of Western Computer’s monthly Dynamics 365 Finance & Supply Chain Management newsletter series, where our experts share practical tips and tricks to help users get more from D365 F&SCM. With more than 35 years of experience and 1,250+ solution implementations, we bring real-world insight into the features, setup decisions, and best practices that help finance, supply chain, warehouse, and operations teams work more effectively in Microsoft Dynamics 365. For monthly updates, subscribe to our LinkedIn Newsletter.
When shipping decisions are handled manually, it is easy for small inconsistencies to create bigger operational problems. A team member may choose the wrong carrier service, miss a delivery preference, or apply a shipping method differently than someone else. Over time, that can affect fulfillment speed, customer expectations, and warehouse efficiency.
Dynamics 365 Finance & Supply Chain Management addresses this directly. When carriers and carrier services are set up in Warehouse Management and linked to modes of delivery, shipping decisions become part of the order processing process rather than a judgment call made at the time of fulfillment.
In this blog, we’ll explain how it works, why it matters, and which businesses get the most value from it.
In many organizations, shipping decisions rely too heavily on tribal knowledge. One person knows when to use Ground, another knows which orders should go 2 Day Air, and someone else is left trying to interpret shorthand in the sales order. That opens the door to errors and drags out execution.
Dynamics 365 Warehouse Management allows you to define shipping carriers and their services in the system, connect them to modes of delivery, and the system will automatically populate the appropriate carrier details during order entry and downstream processes.
The gives a more consistent, repeatable shipping process that helps teams:
The first step is to define the carrier your warehouse will use.
In Dynamics 365, navigate to:
Warehouse Management > Setup > Shipping > Shipping Carriers
Then, create a brand new carrier record, such as UPS.
This carrier record acts as the parent structure for the specific services you want the business to use. Rather than treating each shipping option as a separate standalone setup, you define the carrier first and then add the services underneath it.
This creates a cleaner structure and makes carrier management easier as your shipping operations grow.
After creating the carrier, the next step is to define the services it offers. In the Services Fas
Tab, list the carrier services your organization utilizes. For example:
Each service should be linked to the appropriate transportation method, such as Ground or Air.
This is a key step because it gives the system the level of detail needed to support shipping decisions more accurately. Instead of just assigning a general carrier, D365 can choose between service levels and apply the correct one based on the shipping choice made on the order.
At this stage, the services can also become the foundation for more advanced shipping layers later. Carrier services can include extra settings, such as transit days, rate engines, fuel charges, or accessorial charges, depending on what you require.
Even if you start with a simple setup, establishing the services properly now makes it easier to expand later.
After the carrier services are created, the next step is to verify that they are linked correctly to modes of delivery.
Navigate to:
Sales and Marketing > Setup > Distribution > Modes of Delivery
Here, you should see the newly created shipping options available in the modes of delivery table.
This is a critical part of the setup because the mode of delivery is often what end users select during sales order entry. If the carrier services are connected properly, users can work from the familiar mode of delivery field while the system handles the carrier assignment behind the scenes.
The result is an easy user experience, with shipping logic that is structured and controlled.
Once the setup is complete, you can use one of the configured modes of delivery on a sales order.
Navigate to:
Sales and Marketing > Sales Orders > All Sales Orders
Create or open a sales order and make sure the correct warehouse is assigned. Then, under the Delivery FastTab, choose the desired mode of delivery.
For example, if the user selects UPS 2 Day Air, the system can automatically populate the corresponding:
This is where the setup begins to show its real operational value. Users only need to select the appropriate delivery option, and D365 automatically fills in the related shipping information.
This lowers the need for manual entry and helps shipping decisions stay in line with the company’s defined processes.
Once carriers, carrier services, and modes of delivery are properly set up, the system helps make shipping decisions more consistent across users and transactions.
Instead of relying on someone to remember which carrier should be used or manually entering details each time, the ERP gives a more guided process. This can make a real difference in environments with frequent shipping, where speed matters and mistakes can cause follow-on issues.
By automating part of the shipping setup, businesses can improve process discipline without adding unnecessary complexity for users.
Benefits for end users
This functionality is especially helpful for end users because it simplifies a process that can otherwise involve multiple decisions. Rather than asking users to know the backend shipping setup, the system allows them to work from the mode of delivery and lets Dynamics 365 handle the carrier details in the background.
It is especially useful for organizations that:
As operations scale, what once worked through manual knowledge or workarounds often becomes harder to manage. This setup helps create a cleaner, more repeatable process.
A variety of industries can benefit from this functionality, especially those where shipping accuracy and fulfillment consistency directly affect customer satisfaction and operational efficiency.
Distribution
Distributors often manage large order volumes, multiple service levels, and customer-specific delivery expectations. Automating carrier assignments brings consistency to fulfillment decisions and helps teams execute faster.
Manufacturing
Manufacturers sending finished goods, spare parts, or service components gain value from standardized shipping logic across warehouses and order types.
Wholesale
Wholesale businesses typically deal with repeat customers, negotiated delivery expectations, and multiple fulfillment paths. This approach helps make order handling more reliable.
Retail and eCommerce fulfillment
Retailers and eCommerce businesses can use this functionality to reduce manual shipping entry and create more standardized delivery workflows as order volume increases.
If you would like to see exactly how this setup works inside Dynamics 365, watch the full video walkthrough: How to Set Up Carriers and Carrier Services in Dynamics 365 Warehouse Management.
The video shows you each step in the process and how the carrier and carrier service fields are automatically populated during sales order processing.
If you are not currently using Dynamics 365 Finance & Supply Chain Management, the F&SCM Assessment can help. It is designed to give organizations a realistic picture of scope, implementation approach, and what the platform can do for their specific operation before any commitment is made.