Businesses involved in selling different types of products will always need shipping services. The method for shipping would depend on the orders though. There will always be the need for flexibility when it comes to determining which method to avail. Less-than-truckload shipping (LTL) is one of the methods used by many businesses. The concern that needs answers though involves knowing if such a method is right for you. This article will help you understand more about LTL shipping. By doing so, you will get a better idea when it is right for your business.
Things to Know About LTL Shipping
Freight shipping is a process that involves transporting goods to a predetermined destination. There are two methods that businesses must choose. These methods are full-truckload shipping (FTL) and less-than-truckload shipping (LTL). They are comparable in many ways, which causes confusion to the customer. Cost is the main factor that usually sways the customer’s decision. Yet, knowing more about LTL shipping may help customers form an educated decision. By referring to the following list, you will understand more about LTL shipping:
- The main difference that LTL shipping has over FTL shipping is how much trailer space the cargo uses up. As you can see by its name, LTL shipping refers to cargo not being able to use up all the space inside the trailer. This would mean that with FTL shipping, the total cargo is enough to fill up the trailer. The quantity of the items is a way of determining if the cargo will be enough for FTL shipping or not. Another consideration is also the size of the items. Items with larger sizes may include appliances, machines, vehicles, or even furniture. Even a few of these items might need the customer to avail of FTL shipping service.
- Another difference that needs looking into is the computation of the shipping charges. The way to compute for LTL shipping services is by determining the amount of total space the cargo has used up. This is being done because customers will be sharing the fees of using the specific trailer. A business will only pay for the total space its cargo has used up inside the trailer. This differs with FTL shipping since a trailer will carry the cargo of only one customer. The customer will be shouldering all the fees for using the trailer.
- The delivery process between LTL shipping and FTL shipping is another clear difference. The logistics involved in LTL shipping are more complicated compared to FTL shipping. LTL shipping uses a hub and spoke distribution model. This entails the shipping company to put up a main distribution hub and local terminals. The shipping company spreads out the local terminals to strategic locations. A business transacts by giving the shipping company all the relevant information first. The business finalizes its decision to avail of the LTL shipping service. The business also decides if it needs to have its cargo picked up or not. After receiving the cargo, this shipping company forwards the cargo to the main hub. Different processes happen at the main hub. The cargo undergoes sorting and grouping at the main hub. Preparation is important to avoid missing or damaged deliveries. After cargos in one group are ready, the truck will leave for its respective destinations. The truck will go to different destinations, which depends on the cargo. FTL shipping follows a more direct process. The shipping service picks up the cargo from the client and proceeds to its destination. By following a strict route, there may be no stops until the truck reaches its destination.
- Handling of the items differs between shipping methods. Handling refers to the process of loading or unloading of cargo. For LTL shipping, cargos undergo handling at different stops. There is handling when the shipping company receives the items from its clients. Handling also happens when the cargos arrive at the main hub. Placement of cargos to their respective delivery trucks happens at the main hub. Cargos may undergo handling even if it is not their stop. While unloading the required cargo, other cargo may block the pathway. In cases like these, other cargos undergo handling before arriving at their destinations. Security and safety issues sometimes come up because of this. Misplacing items is a negative result of this. For FTL shipping, handling only happens at the pickup point and the destination. It is more secure and safer since it avoids any chance of misplacing any of the items.
- The simplicity of the process followed by FTL shipping ensures the fastest delivery. Removing any stops along the way is important for items that have time constraints. A shipping company may use more than one driver to go with the delivery. The drivers can take turns driving until they reach the destination. With LTL shipping, it will take longer for the items to reach their destinations. Having to go through the main hub adds to the duration of the delivery. Travel between the main hub and the destination of your cargo may have many stops as well. This happens if the location of the other cargos is nearer as compared to yours. Delivery for those items may happen before yours.
Reasons for Choosing LTL Shipping Over FTL Shipping
As you can see, there is a clear distinction between both shipping methods. This does not mean that you can choose a method right away. There are still factors that can sway the decision to the less preferred option. These factors may or may not apply to your circumstance. But for those who are currently unsure where you belong, you can refer to the following:
- Businesses have clear-cut budgets that are set up for each business need. For newer businesses, the budget for shipping may not have that much importance yet. Smaller businesses focus their budgets more on the production of goods. FTL shipping may not yet be a profitable option for smaller businesses. There may be times that the quantity of the items meets the need for FTL shipping. Most often than not, the budget might not agree though. A business may solve its problem by dividing the items into smaller deliveries. The items that need urgent delivery can go first. An example would be those retailers that offer cash-on-delivery (COD) to their customers. These retailers are risking themselves by paying for the shipping fees first. Situations where customers will not pay for the items they purchased will pose a problem. If they went with FTL shipping, they might incur so much loss if a lot of the customers will not pay during the delivery. But with LTL shipping, they can gauge if problems will come up after delivering the first batch. LTL shipping can help protect the businesses from crashing down.
- Businesses concerned with protecting the environment might find FTL shipping a negative option. By not sharing a truck, the more customers go for FTL shipping, the more vehicles will be running at the same time. This would mean that the use of fuel will increase. As more trucks run at the same time, this would increase the rate of carbon dioxide emission. Carbon dioxide and greenhouse gases are the main causes of global warming. In the end, by choosing FTL shipping, the rate of global warming will also increase. This is not an issue with LTL shipping since customers will share the services of a truck. In turn, this would lessen the use of vehicles that would lead to lesser emission of carbon dioxide. Retailers that put value in the environment can take advantage of LTL shipping.
- Businesses that have an urgent need to ship stocks to a branch can use LTL shipping. If the branch is selling items at a quick rate, LTL shipping can answer the need for a temporary re-stock. Without waiting for the full inventory, sending out partial stocks can be a quick fix. It is better than having a depleted inventory at a branch flocked by customers.
- LTL shipping is also a good option for customers that need to ship items with no urgency. This situation can happen for introducing a new product line to different branches. There is no expectation yet that the demand will be very high from the beginning. A business can use this to test out the possible reception of its new products.
Availing of LTL Shipping is the Correct Strategic Move
New businesses and small retailers can think of using LTL shipping as a strategic move. Using it to test the reception of your customers to any newly added product is crucial. If the reception does not go well, at least you did not spend so much in production and shipping. But if things go well, then you have some time to plan how to cater to all the orders and how you plan to ship them. Budget is a big factor for all businesses. But it is not the only determining factor for a business to succeed.
Availing LTL shipping is a cost-effective option for both small and large businesses. But FTL shipping can be questionable for smaller businesses that are still vulnerable. Those who plan to avail of LTL shipping should inquire from reputable companies. There is a need to consider item classifications in Canada when it comes to LTL shipping. It is best that you relay all the information of your cargo to the shipping companies. They will use this information to create a formal quotation that you will be able to compare around. Ensure that you talk with trustworthy companies as you are leaving the safety of your cargos to them.
If you are looking for a shipping company that offers LTL shipping, you can contact RoadLINX. We are always ready to help our customers with all their shipping needs. You can reach us at 905-760-1141.