If you want to transport a small freight or when the cargo doesn’t need to use the whole trailer, LTL shipping is the best option. You can use less than truckload freight shipping (LTL) when freight weight ranges from 150 to 15,000 pounds.
When shipping LTL, the shipper only pays for the part of a standard truck trailer their freight utilizes, whereas other shippers and their shipments take up the unoccupied space. The following article discusses LTL shipping, how it works, its benefits, types of LTL carriers, factors influencing LTL shipping costs, and more.
What is LTL Shipping?
The standard shipping modes are air, truck, rail, water, or occasionally a combination. Most freight carriers provide two options for transporting products through a truck: TL (truckload service) and LTL (less than truckload shipments). Implied from their names, a TL carrier occupies a whole container of product from a company, whereas LTL involves moving the goods from various businesses on one truck. By sharing the truckload, the companies benefit from a cost-effective shipping option.
When using LTL shipping, you would only pay for the portion of the truck required for your product So, LTL shipping is an affordable alternative, particularly for small businesses. The reason is that for small businesses, the amount of product to be shipped will not need a whole trailer. Because your product occupies only a portion of the truck, other companies would use the remaining space for shipping products that require the same area.
The carriers can specialize in various services within LTL shipping. This can include transit, lift gates, residential pickups and deliveries, freeze protection, guaranteed services, and bottom-line costs.
What is LTL Freight?
After understanding the LTL shipping meaning, it’s imperative to know what LTL freight is. LTL freight means you rent a portion of the cargo space within a transport truck instead of the entire truck bed. Paying only for the required space saves shipping costs.
Every business pays a proportionate fee for the trailer’s part utilized by their palletized cargo. Consequently, LTL shipping is the cheapest way to ship larger-than-parcel freight without the expense of a full truck rental.
How Does LTL Shipping Work?
LTL shipping employs a “hub and spoke” model in the distribution centres.
The following steps describe the working of LTL shipping
Step-1: In a distribution centre, goods are loaded into a truck trailer and transported to their destinations. It connects remote local terminals to the central hubs for distribution.
Step-2: You combine the parcels into one truckload for freight directed in the same direction.
Step-3: Trucks collect shipment at local terminals and either transport it to the distribution centres or you can load them into another truck before delivering it to the destination.
Step-4: For shipment preparation, LTL cargo is consolidated into crates, pallets, or large boxes and, subsequently, shrink-wrapped.
Step-5: After being palletized, freight is piled up and assembled at the distribution hubs.
Benefits of LTL Freight Shipping
- Cost-effective
When shipping the LTL freight, you only need to pay for the space the package occupies in a transport truck. You may need to pay for the entire truck in other shipping services. Moreover, the freight carrier maximises efficiency and capacity, allowing other businesses to consolidate their shipments. Another way LTL freight shipping proves to be cost-effective is that it reduces warehousing costs.
- Reduced carbon footprint
LTL shipping decreases the number of truckloads in transportation. So, it decreases carbon emissions and thus reduces the negative impact on the environment.
- Improved customer experience
LTL carriers provide hassle-free and flexible service options, including inside delivery, residential delivery, and more. Such services shorten the delivery lead times and enhance your customer experience.
- Reliable tracking
Many of the topmost LTL carriers provide LTL shipment tracking services. This allows you to track your cargo in the transportation.
When to Use LTL Freight?
You can use LTL freight shipping when there is a need to ship small freight or when the freight doesn’t occupy the whole trailer space. It is a suitable shipping option when the shipper wants other shippers to fill up the unoccupied spaces. Moreover, small businesses use it extensively to fulfill the customers’ small freight shipping needs at an affordable price
How to Ship LTL Freight?
- Obtain freight quotes
Firstly, you need to obtain freight quotes that denote an estimate of the shipping costs. These charges depend on the information you convey to the carriers. You can obtain a suitable freight quote from a specific carrier, a freight broker, or an online market.
- Determine the suitable carrier
If your LTL shipments get mishandled, all your efforts will be futile. So, it is inevitable to choose an expert career. The selection depends on the expected service level and your cargo type. Make sure to only use a service from a carrier experienced with shipping your freight type. This aspect is inevitable when shipping perishable or delicate products that need careful handling during transit.
Using a suitable carrier ascertains that the product doesn’t get damaged during delivery. Moreover, choosing a reliable carrier provides insurance for your freight while transporting.
- Organise the freight
Improperly packing your shipments increases the chances of product damage. Certain carrier companies bill you extra for improperly presenting the goods for LTL freight shipping. So, you must carefully check the cargo measurements and ensure they match the freight estimate to prevent additional charges.
Your cargo may encounter multiple handling before and during shipment. Thus, you can consider packing LTL freight with pallets and crates to ensure the best freight protection. Remember to arrange bulkier items at the crates’ bottom and the lighter items at the top.
- Label preparation and Bill of Lading (BOL)
The Bill of Lading and Label Preparation are essential documents in LTL shipping. The Bill of Landing lists the item count, origin and destination, freight class, weight, and handling instructions. Moreover, BOL should be completed and handed over to the LTL shipping provider during pickup time.
Label Preparation involves affixing a shipment label that contains complete addresses, phone numbers, and PRO numbers on every box. You must keep the Label Preparation document ready, whether you use pallets or not. Label Preparation proves to be useful for properly labelling the packed items, especially when your freight involves fragile or tilt-sensitive products.
- Schedule a pick-up time
After you prepare LTL shipments for transit, you must schedule a pickup date. Note that the specified pickup time may vary based on when the carrier actually arrives to pick up the package(s). Most carriers try to pick up at your location in 90 minutes. But, this can vary based on location.
- Freight tracking
You must keep an eye on your package. The PRO number provided with the Bill of Lading helps you to track your packaged goods. The moment the carrier picks up the cargo, the barcode is scanned and recorded into the carrier’s online LTL shipment tracking system. Using this code, you can track shipping progress at all exchange points. If the carrier updates the tracking information consistently, you will stay informed of your LTL freight’s location.
- Outstanding claims or invoices
When shipping LTL freight, accidents are sometimes unavoidable. On such occasions, you may have to file a claim or complaint being a direct customer of the particular business. You must validate your claim if you want compensation for your damaged freight.
The claim needs the following documents
- Paid freight bill
- Inspection reports
- Proof of the package’s worth before damage
- Shipping Documents in their original structure
LTL Carriers And Their Types
Truck freight companies provide LTL freight shipping services. An LTL carrier can be an individual or a single service of a larger company. In other words, it is a trucking company that transports products from different customers on the same truck.
The following types of LTL carriers provide LTL freight shipping.
Local carriers
They are freight companies operating within the distance range of 80-800 miles. Usually, small-scale shippers offer cost-effective rates for last-mile delivery. However, you do not need to equip with the latest technologies.
Regional carriers
They move freight to a broader distance range than local carriers. They work with both national and local carriers to seal the transportation gaps between independent distribution centres.
National LTL carriers
They ship cargo all through the country. They own more industry experience, incorporate more personnel, and have more transportation instruments.
Factors That Determine LTL Shipping Rates
- Freight Class
The freights are classified based on class. The factors that determine class are product density, product value, storage facility, liability, and handling. The lower-class freight is dense, heavy, hard to damage, and convenient to handle. So, it offers low freight shipping rates. This aspect implies that the freight class is directly proportional to its shipping rates.
- Density
The freight’s density is inversely proportional to the shipping rate. We calculate it by dividing the total weight of the shipment by the total cubic feet. If you efficiently pack your items, the overall package size reduces, and this eventually helps in reducing the total shipping cost.
- Base Rate
Your freight shipment’s base rate depends on the distance, weight, and destination. After considering them, the carriers adjust the shipping rate to maximise the truckload volumes or to balance off the freight and trucks on specific routes.
- Destination
If the shipment has to travel farther, the LTL shipping rate will be higher. This is because it involves driver’s fees and equipment expenses. It may cost more to ship to a rural, depopulated area than a metropolitan area.
- Additional Charges
When calculating the LTL shipping rates, you need to consider the extra cost of the following additional services.
- Residential pickup or delivery
- Lift gate service
- Inside delivery
- Limited access locations (like churches, prisons, storage units, schools)
- Guaranteed or accelerated service
- Required appointment
- Fuel surcharge (calculated on every single shipment)
LTL Vs. FTL Shipping
LTL and FTL shipping differ based on the following aspects.
- Cost
The cost of LTL shipping is less than FTL shipping because you only need to pay for the space being occupied. LTL shipping saves you from paying unnecessary costs.
- Delivery time
LTL freight shipping is slower than FTL freight shipping in terms of delivery time. The reason is that more than one shipper accomplishes LTL freight shipping. Before the shipments reach their destination, the truck carrying the corresponding LTL shipments must stop numerous times. On the other hand, since FTL freight involves one shipper, the delivery time is significantly reduced.
- Shipment safety
In LTL freight shipping, the shipments may undertake multiple transfers. So, the shipment may be lost or damaged during the process. Conversely, when using FTL freight shipping, your shipment stays on the same truck. Thus, it reduces the occurrences of lost and damaged shipments.
Freight Vs. Moving Services
Freight services
Freight services are moving companies that only offer transportation services. They only involve pickup and delivery. You need to look after packing (based on the freight transport guidelines), and loading and unloading your items. Moreover, freight services are one of the best services to transport household goods.
Moving services
Generally, household moving companies offer moving services. Typically, they can transport household goods and office essentials. They can also transport smaller shipments like pieces of appliances or furniture.
When shipping household goods via a traditional moving service, there is no need to crate or palletize your shipment. But, you must carefully check with your shipping provider for recommendations on shipment preparation.
Let’s go through their differences:
| Freight Services | Moving Services |
| A freight service can handle things like food, meat, beverage, crude oil barrels, car batteries, clothes, smartphones, other gadgets, etc. | Moving services can handle everyday household products. |
| Freight services usually deliver items to a bigger area. | Moving services usually deliver items to a comparatively smaller area. |
| Since freight companies are delivering commodities, they will impact the regional and/or local economy. Hence, they require a unique type of paperwork. | Moving services usually don’t need paperwork to ship freight across borders, national or state. |
| Freight services are professional shipping services that operate without physical contact. It arrives at the specified venue, attaches your load, and conveys the goods towards the destination. | Moving services directly interact with customers. They load your items, shake hands, and try to know more about your shipping needs. |
| It is relatively cheaper. | It is relatively expensive. |
Documents Needed For LTL Freight Shipping
- Bill of Lading (BOL)
It establishes a contract between the shipper and the carrier. Most BOLs contain the following information:
- The agreed date on which you plan to ship the goods
- The carrier’s name and driver’s signature
- The addresses and names of the shipper and receiver
- An in-depth description of the goods (size, value, freight class, etc.)
- Any special information the carrier wants to know
- Freight Invoice
Also known as a freight bill, the freight invoice resembles a BOL in many aspects. It aims to outline the total shipping charges, evaluate any additional freight shipping costs and add intelligibility to information that may be available on the BOL. Freight Invoice is beneficial for the accounting-based activities of the shipping process, chiefly when there are disputes to be resolved.
- Commercial Invoice
If a freight shipment implicates the import or export of goods, you must include a proof of sale, i.e. a commercial invoice. The seller issues this document to the buyer, and it includes the details used for the customs clearance to evaluate the unpaid taxes and duties.
- Proof of Delivery (POD)
POD is signed and distributed by the recipient as an authorization that they have safely received their freight shipment without apparent damage. It includes details like a list of the items in the shipment, the recipient’s name and title, and the delivery time and date.
- Inspection Certificate
This document declares that you have reviewed the goods in a freight shipment and followed the terms specified in the BOL. All freight shipments don’t need an inspection certificate. However, goods like industrial tools and perishable items need an Inspection Certificate.
Conclusion
LTL Freight Shipping saves shipping costs because you need to pay only for the trailer space the package is occupying. In addition to monetary advantage, it is famous for offering safe transit of goods with accurate tracking and a satisfying customer experience. It can simplify the process of shipping bulk quantities of a particular item.
FAQs
What qualifies as LTL?
LTL Shipping is perfect for those companies willing to domestically ship items that are extremely large to qualify for the standard parcel carrier services or too small to qualify for FTL (Full Truckload) shipping. It aims to expedite and streamline the process of shipping bulk quantities of a single item. Typically, this involves items like a lot of boxes stacked on a shrink-wrapped pallet. To qualify for LTL and make it successful, it is ensured that the items stay together during the journey. Moreover, there is minimal damage to the normal movement or boxes being stacked.
Is LTL shipping fast?
Yes, when using LTL shipping, you can ship faster, more frequently, and in smaller quantities. This shipping service eliminates waiting on the number of purchases or the need to stockpile to make a full truckload worthwhile. It is fast because it decreases the warehousing expenses and thus benefits customers with faster turnaround times and a possibility for more sales.
Is LTL freight shipping safe?
Customers who choose to ship LTL benefit from decent support and security throughout the process. 3PL providers and LTL carriers take utmost care when conveying your freight from the point of sale to the destination. Carriers, logistics coordinators, and drivers look after special handling requirements for all shipments. They ensure that the receiver receives it safely. Moreover, they offer all required information for insurance claims or product replacement if any issue occurs.
LTL shipments are easily trackable, and you can make their transit updates throughout the transportation procedure. You can track the packages through the PO number, PRO number, pick-up date range, and shipment reference number.
Which one to choose between LTL and truckload?
Firstly, answer the following questions.
- Do your shipments have the flexibility and don’t need firm pick-up and delivery appointments?
- Do you want to ship less than 10-12 pallets at once?
- Have you ensured that your product is not extremely delicate or fragile?
- Can your product be packed well enough for extra handling?
- Do you require additional services like residential pick-up and delivery, white-glove services, limited access pick-up and delivery, or a lift gate at pick-up and delivery?
If you have answered mostly “Yes” to the above questions, you must choose LTL for your shipping needs.
What is the difference between LTL Freight Broker and an LTL Carrier?
An LTL carrier owns and controls a fleet of trucks that they use to pick up the LTL freight. On the other hand, an LTL freight broker doesn’t own any shipping equipment or trucks. However, it is well-informed in the industry with a powerful network of carrier contacts. The freight broker works as a middle-man.LTL shipping is very complex and doesn’t benefit you from discounted rates. Conversely, LTL freight brokers can access discounted rates by partnering with multiple LTL providers in your favour to utilise volume discounts available. Thus, working with an LTL freight broker on your LTL shipments streamlines the process of conveying your products from the manufacturer to the destination. This process benefits you in terms of pricing, billing, tracking, and maintaining a single point of contact.
Why is LTL freight so expensive?
LTL freight is expensive because you need to pay per pound rather than per truckload. Since you pay a proportionate amount, the average price per pound is high. Consequently, it assists the courier in offsetting the jeopardy of running trucks with less cargo.
