If you’re a business owner who uses transportation vendors as part of your business model, you may be wondering how you can optimize your shipping costs. Between road, ocean, and air freight services, you want to find an economical way to transport your products without compromising on the quality of your service delivery.
In this post, we’ll discuss how less-than-truckload (LTL) freight can be a cost-effective shipping solution for small-to-medium-sized businesses. By garnering more insight into LTL freight, you can make better-informed decisions that will benefit your business in terms of both savings and efficiency.
What Is LTL Shipping?
LTL shipping is a method of transporting goods that don’t require a full truck to carry them. Instead of one company filling an entire truck with their products, LTL shipping allows multiple companies to share space on the same truck. This makes it an affordable and reliable option for small-to-medium-sized businesses, as each company only pays for the space they use.
The shipping rates of LTL carriers often depend on several variables:
- Weight of the shipment
- Dimensions
- Distance and destination
- Freight classification (NMFC)
- Number of pieces
- Special handling instructions
- Value/Liability
- Time sensitivity for delivery
Many LTL carriers have their own rules and limits but generally carry individual shipments between 150 and 15,000 pounds. Most shipments under 150 pounds are usually handled by parcel or postal services.
An LTL provider’s network makes use of a hub-and-spoke system where goods are moved between hubs and smaller outlying terminals spread across its service area. LTL shipping is a 24-hour operation where shipments move continuously through the network. Since LTL carriers consolidate goods from various shippers into a single truck, they make multiple stops for deliveries and pickups.
How Does LTL Shipping Compare to Other Freight Types?
There’s more to consider beyond the method of transporting shipments. Many types of freight services exist for different budgets, timelines and shipment handling needs:
- LTL: LTL shipping is ideal for smaller shipments that are unable to fill full truckloads. The cost is on the lower side since you pay only for the space your shipment occupies in the truck.
- Full truckload (FTL): FTL carriers are suited for larger shipments where one company’s products occupy an entire truck. This freight type has a faster and more direct delivery time, but it can be more expensive for smaller loads.
- Parcel: Businesses use parcel shipping for small packages and individual items. This method is generally faster for delivering smaller shipments but can be costly per unit weight compared to LTL, especially when you have many products to deliver.
- Intermodal rail: If you’re looking for a cost-effective, efficient and environmentally friendly way to ship large or hazardous materials in bulk, intermodal rail freight is your best solution.
- Air: For time-sensitive shipments, air freight is the fastest mode of transport. This is a common freight type for businesses providing high-value or perishable goods, but it’s typically the most expensive option due to the speed and handling involved.
- Ocean: The most economical way to ship large containers around the globe is through ocean freight. Similar to LTL and FTL for road freight, you can choose between different transit times and container types.
- Expedited: Also known as hotshot services, expedited shipping involves faster delivery times for time-sensitive shipments. Expedited freight is handled by one carrier with the goal of meeting your delivery deadline, provided you send it off before a specific time.
Examples of LTL Freight Carriers
LTL carriers are categorized based on their operations, services, speed and costs. Choosing the right type will mostly depend on your shipping volume and product destinations. Common LTL freight carrier types include:
- National: National LTL carriers operate across the country and offer extensive coverage and service options.
- Regional: Regional LTL carriers focus on specific geographic areas and often provide specialized services within those regions.
- Multi-regional: These LTL carriers cover large areas made up of two or more regions and can be seen as a category between national and regional.
- Sub-regional: Sub-regional LTL carriers provide their services to a distinct part of a region or group of states.
- Local: Local LTL carriers serve specific local areas or cities, offering personalized services and quick deliveries.
- Asset-light: Asset-light LTL carriers try to maximize their geographic reach while working with minimal assets to provide a low-budget option for businesses.
- Load-to-ride: These LTL carriers handle long-range shipments by picking up freight from different destinations and delivering them without stopping at hubs or terminals.
- Reefer: Also called refrigerated trucking, reefer trucking is the transportation of perishable items. Reefer LTL carriers work similarly to load-to-ride carriers, but they also handle temperature-sensitive products; similar to that of a traditional LTL carrier.
Benefits of LTL Shipping
If you’re looking to save on finances while streamlining your business’s logistics, here are a few ways LTL freight shipping can benefit your bottom line:
- Cost savings: LTL shipments are based on the space and weight of your products, offering greater cost savings than FTL shipping.
- Flexibility: LTL shipping accommodates shipments of different sizes and weights, making it ideal for companies with various products.
- Reduced risk of damage: Many LTL carriers have advanced handling processes to minimize the risk of damage during transit.
- Tracking and visibility: Most LTL carriers provide tracking services to offer businesses real-time visibility of their shipments.
- Eco-friendliness: LTL shipping methods reduce the amount of fuel and the number of vehicles needed for shipments, reducing your business’s carbon footprint.
- Access to carrier networks: Even when you have unique shipping requirements, you can access national and regional carrier networks that enhance your delivery efficiency.
Considerations When Using LTL Freight Shipping
When deciding on your LTL freight shipping service provider, follow these best practices to increase your delivery efficiency:
- Determine freight class: Classifying and measuring your freight’s weight and dimensions will give you the information needed to compare costs between different LTL carriers.
- Use quality packaging: Ensure you use proper packaging to protect your goods during transit and handling to avoid damage.
- Calculate volume: Assess your shipping volume and frequency to determine which type of LTL shipping is the right fit for your business.
- Prioritize transit times: Because LTL shipments tend to take longer with deliveries, make sure you choose a carrier with transit times that align with your delivery requirements.
Partner With Broussard Logistics and Save on LTL Freight Costs
To optimize product shipping efficiency and cost savings for your business, it’s important to explore the various LTL freight options available. However, we understand it can be challenging for one company to follow these freight insights. Every shipment is unique.
Broussard Logistics offers carrier rate negotiation services that level the playing field between our customers and LTL freight carriers. We can help you achieve your goals, lower costs and keep up with the ever-changing shipping industry. Get in touch with our team today and let’s start a conversation.