The Differences Between Less Than Truckload and Full Truckload

You need to know the clear cut differences between less than truckload and full truckload shipping services before you can effectively decide on which one is most suitable for your shipping plans. This article will help you with the information you need to clearly understand each shipping option, and also point out what to consider before settling for one or the other to meet your logistic needs.

Less Than Truckload Shipping

This kind of shipping service, which is often shortened as LTL, is the kind that requires shippers to pay for the trailer space that they use per shipment alone. These shipments are less than a full truckload. They may be made of about one to 10 pallets that weigh as much as 100 to 10,000 pounds. The LTL carriers operate by the use of a network of terminals that’s similar to a hub and spoke formation. The spokes, in that illustration, represent the local terminals while the hubs stand for the major centers of distribution. By the use of their various terminal positions, carriers can help with freights that are headed in a similar direction to cut down the cost of their shipping for shippers who don’t have the capacity to completely fill a whole truck.

Truckload vs LTL

Full Truckload Shipping

Unlike the less than truckload shipping, full truckload shipping, which is also shortened as FTL, is the conveyance of similar goods that completely occupy an entire truck or trailer. Some carriers are able to haul as much as 24 standard pallets that weigh as much as 42,000 pounds. Freight that is transported through FTL would normally convey goods straight from the take off point to the scheduled destination.

The Market Differences Between Them

One of the cardinal factors to consider when trying to decide on which kind of shipping to settle for is the market difference.

The Full Truckload Market Place

The full truckload market is almost incapacitated by the demand of more than 350,000 owner operators who are looking to fill up their trucks or trailers to transport goods around the United States. Carriers aim to keep their trucks full because empty miles result in the loss of revenue. So they use load boards, which is a software designed to aid carriers and shippers in posting their needs to transport freight or the availability of carriers to transport the freight in any given area.

This kind of market is referred to as the full truckload spot market. This is because rates aren’t determined beforehand. Instead, they’re decided on the spot by negotiations. In the spot market, a cardinal factor to consider is something called backhauls. Backhauls is another word, in the spot market, for return trips that are needed for a carrier to return home after a primary haulage. If the backhaul of a carrier is empty, there’s bound to be a loss of revenue and an unavoidable expense on the return trip. So, carriers consider their backhauls before embarking on a primary haulage.

See the following illustration for clarity: Carrier Company X is based in Houston, Texas. In order to be in profit while also avoiding any possible losses of revenue, they stick with shipment requests from within Houston in order to avoid running with empty trucks, which would unavoidably cost but not generate revenue, leading to a loss. For Carrier Company X to accept a shipment request from Oklahoma City in Oklahoma, for instance, there has to be a need for another freight in Oklahoma City to be hauled back to Houston, Texas. That way, Carrier Company X stays in profit.

The Less Than Truckload Market Place

This market is different from the full truckload market because it has fewer carriers to choose from. This is caused by the need for certain assets to manage the operation of an LTL business. The entire United States is served by only 10 national LTL service providers. A few of the LTL carriers are specialized for operations in certain parts of the country, which means they’re not available to others. The pricing of LTL services is also more complicated than that of FTL. With LTL, carriers offer diverse discounts that depend on density, distance, minimum charges, classification, and accessorial charges.

Furthermore, the LTL carriers evaluate the freight of the shippers before coming up with a price. They consider factors such as packaging specifications, product value, and pattern of shipping in order to determine a shipping cost. To find out more on LTL cost, visit http://ltxsolutions.com/less-than-truckload-ltl-shipping-cost/

Their Capacities

LTL and FTL alike offer various kinds of capacity. FTL is likely to be influenced by erratic factors that can result in capacities either in the shippers’ favor or in the favor of the carriers. Think of it like a scale in which the carriers are on one side and the shippers are on the other. Factors like seasonal freighting needs, fuel, tonnage, and driver availability all determine where the scale tilts to in connection with cost. For instance, seasonal freight, like produce, can move the shippers’ freight expense to twice or thrice as much as the normal price, which gives the carriers an edge on the shippers. On the flip side, shippers would pay less if the overall market tonnage went down.

The capacity of LTL isn’t as closely related to the overall economy as FTL. Typically, pricing contracts can last as long as a year, which enables shippers to negotiate on annual basis. This is also in favor of the carriers because it allows them to account for levels of capacity by extrapolations. Both FTL and LTL serve most shippers well. If you fall into the category of shippers who turn out enough products to fill a whole trailer per shipment, then, FTL will serve you best. If, on the other hand, your shipment is sparse, go for LTL to avoid paying more than you should.

Justin Bright – CEO Brighter Logistics
Michigan Freight Broker

Freight Management Tips To Ensure Timely Deliveries

As a player in the supply chain industry, you might have on several occasions been faced with issues of delayed shipment. This delays might have been caused by a number of reasons from traffic delays, weather issues to mistakes by the carrier that might make you feel like you have no control over the shipment process.

Freight Management Tips

This however is not the case as you play an important role in ensuring efficient and timely delivery of your shipment which will in turn help you avoid issues like having to deal with angry customers or disruption in the supply chain. Here are five freight management tips that you can incorporate into your freight management strategy to help you avoid late deliveries.

Always Be In Communication with Your Carrier

Being in constant communication with your carrier will help you plan better and be ahead of any issues that might result in late delivery of your shipment. Because the transportation industry is driven by supply and demand, constant communication with your carrier will help cultivate a good working relationship. Such a relationship is critical whenever there is tightened capacity in the transportation industry or you have emergency needs as your carrier will find a way to ensure your shipment is delivered on time.

Proper and Accurate Documentation of Your Bill of Lading

A bill of lading contains all important information about your shipment. Preparing a proper and accurate bill of lading is an effective way to avoid late deliveries. A BOL helps your carrier make proper and efficient logistical planning for the transportation of your shipment as it provides them with all information they need. A BOL should containing information on:

· Nature of shipment
· Commodity classification
· Weight of shipment
· Packaging of shipment
· Labelling information
· Contact details
· Any other delivery instructions

Having inaccurate information on BOL might result in unnecessary delays as your carrier will have to deal with issues emanating from an inaccurate BOL
Proper Labeling Of Your Shipment

Having properly labelled shipment is beneficial to both your carrier and consignee. In fact many consignees will not receive any shipment that is not properly labelled according to what you had agreed on. Furthermore, retail suppliers are likely to be fined with costly chargeback fines if they did not have right labels and in their correct positions on shipment destined for distribution centers. As a retail supplier, you might be interested in getting more information on best ways to reduce/avoid chargeback fines.

Have All Clearance Certificates Ready

If your shipment is required to have certain clearance certificates, it is important to ensure all the clearance certificates are prepared and approved on time. Clearance certificates can range from safety standards certificates to health certificates etc. Having clearance certificates processed on time will ensure no delays on your shipments during clearance by regulators.

Proper Packaging OF Your Shipment for Transport

Packaging plays a crucial role in determining whether your shipment will arrive on time or delay. Because your shipment will be handled many times and by different people before it reaches its destination, it is important to ensure that your shipment is properly and securely packaged.

Additionally, during transpiration your carrier should provide for proper stabilization a dunnage to prevent shifting of shipment while in transit. Shipment that is not packaged properly might not only get damaged but will also result in delays as your carrier will have to repackage it properly.

Justin Bright – CEO Brighter Logistics

4 Advantages of Less Than Truckload (LTL) Shipping

Many small and developing businesses are taking advantage of less than truckload (LTL) shipping. LTL shipping is the transportation of freight that is less than a full truck load for a standard semi-trailer. The weight requirement for LTL shipping starts around 100-150 pounds and can reach up to 20,000 pounds. LTL companies usually operates on a truckload pooling consolidation and distribution system where multiple LTLs are combined to make a full truckload. The most obvious advantage of a pooled distribution system is a much lower shipping rate, but there are several other perks of utilizing LTL shipping including minimized costs, reduced carbon emissions, fewer risks compared with parcel carriers, and technological innovation.

Minimized Costs

Numerous studies have shown that LTL shipping is cheaper and more economical than parcel shipping. When using LTL shipping, you’re only charged for the weight of your freight. In a truckload pool, the cost of the full truckload is distributed among the manufacturers so that each saves money. This is particularly advantageous for small and developing companies, giving them the flexibility in cost and inventory control. Businesses and organizations can move smaller loads of goods for less money. This also helps trucking companies by allowing them to fill trailers to capacity, earning them more money and making transporting materials environmentally friendly and efficient.

Reduced Emissions

LTL shipping doesn’t only cut costs for the shipper, it drastically cuts down on carbon emissions from diesel trucks. This is extremely beneficial for the environment considering the other option of a semi-truck driving cross country pulling a trailer that’s not even at capacity. Again, this is where the advantage of truckload pooling comes into play because there are multiple small loads of freight completely filling one semi-trailer versus several trucks on the road with loads below their capacities.

Fewer Risks Compared with Parcel Shipping

If your freight is too light for LTL shipping, you may have no other option than parcel carriers. But if your freight weighs in at least 150 pounds, it’s pretty much guaranteed you can take advantage of LTL shipping. LTL carriers are urged to take special precautions with LTL freight using travel-safe containers to protect packages from damages during handling and to reduce the chances of individual items being lost.

Technological Innovation

The shipping industry has not fallen behind in technological advancement which has improved the efficiency of the shipping process. Innovations in application programming interface (API) and electronic data interchange (EDI) have made it easier for LTL companies to seamlessly automate workflow. Ritualistic tasks like automated pick-up requests, API quotes and responses, document retrieval, tracking notifications, and automated batch invoicing have become much more user-friendly and intuitive.

As you can see, there are several benefits of using LTL shipping if the freight falls within the required weight range. LTL shipping is a win-win agreement, preferable to the shipper and the trucking company in most scenarios. This information should help you determine whether LTL shipping is a good option for your needs.

Justin Bright – CEO Brighter Logistics