Understanding Less-Than-Truckload Shipping
You own a small boutique in Canada specializing in the manufacturing and selling of vintage-inspired shoes. Although your brand has yet to become globally recognized, you take all the necessary steps to get there one day. One of those steps is growing your business by expanding into new markets. To accomplish this, you will need transportation to warehouses or delivery destinations. The question you have been researching online is how to efficiently and effectively transport small ground shipments without breaking the bank. In your research, you've come across two terms: Full Truckload (FTL) and Less-Than-Truckload (LTL). But what is the difference? That's the emphasis of today's blog post; we will explain the various truckload shipping options, particularly less-than-truckload (LTL) shipping, along with the benefits and differences between LTL and FTL, in addition to the requirements for LTL shipping.
How Does LTL Shipping Work?
Less-than-truckload (LTL) shipping refers to combining multiple LTL shipments onto one trailer to create one full trailer. This trailer is then delivered to a central hub/terminal and unloaded.
Smaller delivery trucks will then make all the deliveries. In these instances, companies would share trailer space with unrelated companies, going to similar or the same destinations.
LTL load dimensions and weight play a role in determining the rate, as do the loading and unloading requirements, special services, and delivery locations.
Everything we have in our home has one way or another, been transported via LTL or Full truckload shipping (FTL).
Less-than-truckload shipping, according to IBISWorld, is worth $104.8 billion in 2023 and is expected to increase by 1.3 percent in the US over the year. However, they further highlight that the LTL market size in Canada is $14.1 billion and is expected to increase by 2.6 percent in 2023.
According to IBISWorld insights, Canada's trade accounts for a significant portion of its economy, and most of this prosperous trade is being transported by trucks. The same can be said for the US as their total trade value increases, requiring more goods to be transported.
What Is Full Truckload Shipping (FTL)?
Companies that can fill an entire truckload with goods use this type of transport. This means that the trucks transporting goods via ground shipment will only be filling the trailer space with one company's load, not multiple, unlike LTL freight shipping. Companies seeking FTL shipping must pay the total truckload rate, regardless of whether the trailer is at full capacity. To make it cost-effective, they should have enough freight to fill the trailer.
What Is The Difference Between A Full Truckload And A Less-Than-Truckload?
In simple terms, the difference between FTL and LTL would be the number of pallets or the size of the load transported. Suppose a trailer has enough cargo space for fifty pallets of shoes; the FTL represents all fifty pallets filling up the entire area, whereas LTL would only fill up a portion of that space.
For example, five skids, each 40" long, 48" wide, and 96" high, would take up 10' of the trailer and move as LTL for the best pricing. Your freight manager knows how to obtain the best price for you.
The Benefits Of LTL Shipping
LTL shipping provides the following benefits to companies with less than a full load to ship.
LTL Shipping Can Save Your Small Business Money
Transporting small loads can be cost-effective. With LTL transport, you only pay for what you get, which means only paying for the space your shipment occupies.
It Is Beneficial To The Environment
The International Trade Administration (ITA) stated that supply chains should be strong, resilient, and sustainable. This means that each process in the supply chain, from procurement of sustainable raw materials to low-emission delivery of products, can be assessed to mitigate its environmental impacts. LTL shipments impact the environment less as the trucks' trailer space used to transport goods is shared by other companies. If LTL shipping were not an option, small businesses would waste money and resources using FTL shipping for each of their small shipments.
Know Where Your LTL Shipments Are
One of the best benefits is increased visibility, as most LTL carriers provide companies with tracking tools that allow them to see the movements of their shipments in real-time.
The Best Practices For LTL Shipping
Regardless of the shipping size of your cargo, when shipping LTL and FTL freight, there are a few things a company should consider. The following are the best practices for small businesses and their LTL shipping.
Know Your LTL Freight Dimensions
For carriers and freight forwarders to determine the costs of your LTL shipment, they would need to know the exact dimensions and weight of your cargo to best allocate the trailer. They would know whether to use a common carrier or a contract carrier. Providing accurate information to your LTL carrier providers will eliminate misunderstandings that could cause shipment delays or extra charges.
Determine How Many Times The LTL Shipment Will Be Loaded And Unloaded
LTL carriers provide estimated times for delivery, not exact times of arrival. Always allow ample time for your LTL shipments to arrive, as there could be delays due to external factors out of your control.
LTL shipments can be moved around often. Whether offloading at a warehouse, a delivery destination, or moving to another trailer, your goods could be damaged in the process. Small businesses must be aware of their shipment's movement, offload, and loading. Shippers are responsible for packaging their shipments to withstand the rigors of transportation. Carriers will refuse to pick up poorly packaged/crated/skidded freight.
Know Your Carriers
There are a few ways to find the best shipping solutions for your cargo, including using a freight forwarder or a direct carrier. However, understanding the benefits of using either could help your overall operations.
A freight forwarder is in a good position as they have access to an extensive network of carriers. Freight forwarders with long-standing relationships with vetted carriers have many benefits, including reliability, safe practices, established communications channels, and claims history. Freight professionals care a great deal about the safety and have the benefit of knowing a carrier's history and track record, which gives way to better outcomes for your small business.
Compared to asset-based carriers, freight forwarders are not limited to the trucks they have available. Instead, they have an unlimited number of carriers they can work with to assemble your freight in combination with other clients.
A company can contact a freight forwarder or a carrier directly to transport their goods via ground transportation. However, when using a freight forwarder, they can provide you with various options of carriers that can transport the load. In other words, they research to find the best space for your small shipments and act as a middleman between the client and their vast carrier network.
Get professional assistance in the movements of your LTL or FTL shipments from freight management experts that can help you move your goods on the ground and across borders.