No one wants to pay for air when transporting goods.
Yet, research shows that around 45% of shippers don’t fill their trucks, wasting space in truckload shipments.
There has to be an alternative that allows you to ship smaller shipments without paying for a whole truck, right?
Well, I’ve got good news for you.
Let me introduce you to LTL.
What is LTL freight shipping? What does LTL mean in trucking?
I’ll explain the LTL logistics meaning below, including its benefits, drawbacks, and pricing.
What Is LTL Freight Shipping?
You may have heard of LTL shipping when discussing logistics but aren’t entirely sure what it means.
In the first place, what does LTL stand for?
LTL stands for less-than-truckload. In terms of shipping, it means moving small or large packages that don’t take up the whole space of a truck.
Then, what are LTL loads?
Less-than-truckload (LTL) loads are smaller shipments weighing anywhere between 150 and 15,000 pounds. For reference, truckload shipments can weigh around 45,000 pounds.
LTL services provide professional freight shipping without the extravagant cost of a whole truck. You only pay for the space your shipments take up.
Other shippers can use the same truck until it’s full. They also pay for only the space their freight shipments take up.
You’re essentially sharing the truck’s cost with other businesses. This gives you, and many others, significant cost savings as long as you don’t need a full truck.
How Does LTL Shipping Work?
Now that you have a grasp of the LTL meaning in freight shipping, it’s time to learn what is LTL shipping method.
You need to understand the whole system to have reasonable expectations for timelines and delivery speeds. Let’s dive into the LTL transport process in detail.
1. Freight Pick-up
The LTL delivery journey starts at the pick-up date.
First, you schedule an LTL freight shipping pick-up with your chosen LTL carrier. Then, a standard truck trailer will pick up your LTL shipment on the scheduled date.
The same vehicle handles multiple packages simultaneously, so they will stop by other warehouse locations to pick up separate LTL shipments.
2. Hub Drop-Off
Once the truck driver has finished making their rounds, they drop off the LTL shipments at a central hub.
This is where the carrier sorts and consolidates the packages going to the same location. They prepare them for another journey on the road.
3. Destination Terminal Drop-Off
The LTL carrier loads your pallets and other shipments into a long-haul truck. They either go straight to their destination or to another hub.
Most LTL shipments arrive at another connecting facility first. In this case, the handlers sort your packages again and load them into another truck that takes them to the destination terminal.
This is your shipment’s last stop before its final destination.
At the destination terminal, the carrier loads your LTL shipment into a smaller truck for the last leg of the journey.
What’s the final destination?
It could be your warehouse in another state or a customer’s business location. You can even ship LTL freight to a residential address as a special service.
Other LTL Freight Special Services
Less-than-truckload shipping providers offer customized services according to your needs. Contact your freight service provider if you need the following services.
LTL Freight Tracking and Insurance
Most LTL providers have an online tracking service that allows you to check in on your package’s location anytime.
You only need the bill of lading, PO number, or shipment reference number. Some LTL carriers offer also provide real-time updates via SMS.
More importantly, you have several insurance options to ensure the safety of your packages. You can have peace of mind knowing that your packages have coverage for damages and losses.
Do you need faster delivery speeds? Or do you have a sudden urgent delivery?
No need to worry; LTL shipping also has an expedited delivery option. As expected, this is more expensive, but it can help your shipment reach its destination more quickly.
LTL carriers are more than capable of shipping freight with special requirements.
For instance, they can provide liftgates if you or the destination don’t have one. They also have special services like limited access to rural areas, construction sites, and other places that aren’t normally accessible.
As mentioned, they can also access residential addresses for pick-ups and drop-offs.
Of course, these add-ons come at an extra cost.
Benefits of LTL Freight Shipping
LTL trucking can help your business stay competitive if you use it right. Here are some ways it can help your business:
Lower Shipping Costs
An LTL freight service can help you improve your business’s bottom line.
As stated, LTL freight shipping can collect partial loads from other nearby businesses to fill a whole truck. You only pay for a fraction of the usual full truckload freight cost, while other shippers pay for the remaining space.
Efficient for Smaller Freight Loads
If you have enough to fill a whole truck, using full truckload shipping makes more sense. It’s cheaper that way, and you enjoy its other benefits.
Then, should you let your orders pile up until you can leverage full truckload shipments?
Of course, not. You shouldn’t keep your customers waiting.
Holding off your shipments can disrupt your business operations and cause supply chain issues. You may end up losing more in an attempt to save more.
LTL shipping allows you to send out small shipments at a time. You can schedule pick-ups more frequently so your customers get their orders faster.
Better for the Environment
Did you know that by shipping LTL freight, you’re helping the environment a little?
Consolidating LTL ground shipments allows freight carriers to deploy fewer trucks on the road. This equates to reduced emissions and fuel usage.
Who knew that using a cost-effective LTL freight service allows you to keep your business’s carbon footprint to a minimum?
Challenges of LTL Freight Shipping
Less than truckload freight shipping isn’t perfect all the time. It also has some potential disadvantages that you should consider first.
You’re trading fast delivery for lower rates when you choose LTL shipping.
LTL standard shipping, for example, can be the slowest option. It’s a no-frills delivery service that moves packages without special provisions.
Although there’s an expedited LTL shipping option, it isn’t as fast as getting your truck.
When shipping LTL freight, the truck you share with other business shippers will stop at several pick-up and drop-off points. Then it spends more time loading and unloading separate shipments, unlike other options that can go straight to the destination.
If you want to ship LTL freight from coast to coast, this shipping method takes even longer because of the multiple stops along the way.
This isn’t always an issue, however. You can work around this by scheduling pick-ups earlier to ensure your shipment arrives where they need to be and when they need to.
Loss and Damage Risks
Let me preface this by saying risks are always present, no matter your shipping method.
That said, you should be aware of the LTL shipping risks to lessen the costs of damages and losses.
As previously mentioned, your goods go through several transfers before they arrive at their final destination. Handlers may need to unseal the shipment to sort them, as well.
As LTL carriers handle your shipment multiple times along the way, its chances of getting lost or damaged are higher.
Your freight shipment can travel a complicated route with LTL shipping. This opens it up to less predictable issues than straightforward shipping.
These drawbacks only highlight the importance of choosing the right partner. You must consider multiple carriers and find reliable ones to lessen the risks.
Factors That Go Into the LTL Shipping Rates
LTL freight rates mostly rely on freight classes.
Now, you may ask, “What’s a freight class?”
This is an important part of truckload shipping, so I’ll explain it carefully.
First, I’ll introduce you to the National Motor Freight Traffic Association (NMFTA). It has a standardized pricing system called the National Motor Freight Classification (NMFC).
This system groups shipments into 18 classes – from class 50 to class 500.
Class 50 is on the lower end, which means it has lower pricing. Class 500 is the most expensive to ship.
The NMFC depends on four factors to determine your goods’ transportability:
I’ll go into more detail below.
Your carrier will need your shipment’s weight and dimensions to get its density. The higher the density, the lower the class (essentially, the lower the cost).
How difficult is it to handle your shipment? Carriers must deal with loading and unloading your goods from terminal to terminal.
If your shipments are fragile or challenging to move, the freight class will be affected.
The shipment’s liability score depends on how prone it is to receive or cause damage. It also considers perishability, fragility, and risk of theft.
Stowability refers to how well the shipment stacks beside and against other goods.
An irregularly-shaped item may make it difficult to place other shipments around it.
Dangerous goods might not be able to be stowed alongside non-dangerous shipments.
If your shipment has low stowability, it will eventually end up in a higher class.
5. Other Factors
Note that LTL carriers still consider other factors when determining your shipping rate.
Once they ascertain the freight class, they will then evaluate your other shipping details, such as:
Distance between origin and destination
Other special services and customizations
For these reasons, every truckload shipment will have varying shipping costs. Talk to your chosen freight shipping provider for accurate quotes.
When To Use LTL Shipping
Many eCommerce websites ship using less-than-truckload. LTL delivery provides them with a cost-efficient strategy to meet consumer demands.
It allows them to ship freight as soon as orders come through, even if they don’t fit the parameters for renting a full trailer.
LTL shipping is also the perfect option for businesses with smaller shipping needs. Small businesses don’t usually have enough shipments to fill a whole trailer.
LTL freight services give them a shipping solution that isn’t as expensive as paying for a truck they can’t maximize. They can save money while still catering to customers nationwide.
If your needs align with these scenarios, LTL shipping is the right strategy for you.
When Not To Use LTL Shipping
As mentioned earlier, LTL freight services are best for shipments weighing between 150 pounds to 15,000 pounds.
What if your freight falls below or above those figures?
You have other shipping methods to consider. I’ll quickly explain them below.
LTL vs. Parcel Delivery
You might already be familiar with FedEx, UPS, USPS, etc. These parcel carriers are the major players in the shipping industry.
If you need to ship freight weighing less than 150 pounds, parcel delivery might make more sense. It can be more cost-effective and efficient to organize.
Should you need to send a small package to a business or residential address, there’s no need to pay extra. Parcel shipping already includes this service, whereas it’s an additional cost in an LTL service.
LTL vs. FTL Shipping
FTL stands for full truckload, referring to shipments that can take up a trailer’s whole space or weight limit.
That aside, what is the difference between LTL and FTL freight?
When you choose FTL, you pay for the whole truck. This means there’s no need to make multiple stops, and your shipment goes straight to its destination. The supply chain moves faster, leading to more satisfied customers.
It also ends up being cheaper when your freight occupies the entire truck. However, if you don’t have enough, you’ll also have to pay for the unused space.
LTL vs. STL Shipping
There’s an option that gives you the convenience of FTL and the cost-efficiency of LTL: shared truckload.
Shared truckload, like less-than-truckload, pools multiple shipments from different shippers. Each one only pays for the space they use.
However, it has one key advantage over shipping LTL.
STL doesn’t stop at multiple hubs to transfer your freight from truck to truck. Like full truckload shipping, it goes straight from your warehouse to its destination.
This is only possible because the shipments share a similar route.
How To Prepare LTL Freight Shipments
When shipping LTL freight, carriers will ask for some key details about your shipment, such as:
Number of units
You need to get all these details into the bill of lading to get accurate and instant LTL rates.
Carriers need accurate information to identify the freight class and assess their trucking capacity. They may charge adjustment fees if the declared details differ from the actual ones.
When your bill of lading and other details are ready, it’s time to pack your LTL shipments. Use pallets and sturdy supports to prepare your freight for a long journey.
Frequently Asked Questions (FAQs)
How Do I Determine the Freight Class?
The freight classification system is complicated, but the good news is that you may not have to figure it out.
Freight shipping companies have an NFMC system that can classify your shipment accurately. All you have to do is provide all the information.
Granted, it can be tedious to supply the right information. However, remember to do it correctly to get accurate LTL shipping quotes.
Can You Use a Third-Party Logistics Provider?
Working with a third-party logistics provider can be ideal because it can help you maximize cost savings.
They can negotiate with multiple carriers so that you can compare several LTL freight shipping quotes. They can also optimize your freight shipments for you.
Which Is the Best LTL Freight Carrier?
This question is difficult to answer as it depends entirely on your unique needs. However, I can give you a couple of tips.
In general, you should look for:
Various LTL shipping options
Good track record
Consider both regional and national carriers, depending on your freight needs. Make sure to communicate your expectations clearly to avoid any surprises down the line.
The Bottom Line
LTL trucking can net you huge savings if you know how to use it right.
Although, you have to consider many variables when figuring out the logistics. One wrong move can create supply and delivery issues for your business and its customers.
It pays to learn more about standard shipping and your other options to know the best direction for your business.