Less-than-truckload (LTL) freight is a cost-effective and flexible way to move small quantities of goods. Unlike full truckload freight (FTL), LTL freight combines shipments from multiple businesses into one full truckload. you only pay for the space you need.
Many growing eCommerce businesses use LTL shipping to replenish inventory. This is because LTL shipping offers economies of scale when moving smaller amounts of goods. LTL freight is an appealing option for merchants who need to move less than six pallets of inventory.
This blog explains the logistics behind LTL freight shipping and why it matters for growing eCommerce businesses. With Easyship, you’ll be able to access discounted LTL freight rates up to 70% from top carriers via our platform.
Let’s take a look at the benefits, challenges and how LTL freight shipping works.
Table of Contents
What is LTL Freight Shipping?
LTL Freight is when you rent part of the cargo space in a transport truck rather than the whole truck bed. When you pay only for the space you need, you save on shipping costs.
In LTL freight shipments, your freight is combined with that of other businesses. Each merchant pays a prorated fee for the portion of the trailer occupied by their palletized cargo. This makes LTL shipping the cheapest way to ship larger-than-parcel freight without incurring the cost of a full truck rental .
LTL freight shipping services are provided by truck freight companies. An LTL freight carrier can be an individual or as a single service of a broader company. truck freight shipping is available from the following carrier types:
- Local carriers: These are freight companies that operate within a local radius of 80-800 miles. Smaller providers often offer better rates for last mile delivery of inventory But may not be as technologically sophisticated.
- Regional carriers: Companies that operate move freight to wider territories than local carriers. Regional carriers work with both local and national carriers to close transportation gaps between unconnected distribution centers.
- National carriers: National carriers like X haul cargo throughout the country. These companies tend to offer more transportation equipment, personnel and industry expertise.
Related: More Definitions and Shipping Terms
The Pros and Cons of LTL Freight Shipping
LTL shipping differs from FTL shipping in a handful of important ways. compared to FTL. Let’s discuss some of the pros and cons so you can make the best informed decision between the two.
- Cost savings: LTL freight allows you to pay only for the space you need in a transport truck. You save money by throwing your cargo in with other shipments. The freight carrier maximizes capacity and efficiency with shipments from other businesses. It’s a win-win.
- Reduce warehousing costs: Instead of renting extra space, small businesses rely on LTL freight shipping to reduce warehousing costs.
- Reduced environmental impact: LTL shipping reduces the number of truckloads in circulation, which decreases the carbon footprint of your logistics.
- Additional delivery services: LTL carriers offer flexible and convenient services options, including , residential delivery, inside delivery and more. These services help to shorten delivery lead times and improve your customer experience.
- Tracking: Leading LTL carriers offer tracking services for shipments, allowing you to track your cargo in transit.
- Longer delivery times: It takes longer to coordinate an LTL shipment between multiple merchants. If time is short, you may prefer to use FTL freight for faster delivery lead times. This is because an FTL driver picks up your cargo and drives straight to your final destination.
- Risk of loss or damage: In an LTL freight, your goods are loaded and unloaded several times en route to the final destination. Amidst all this handling, , the risk of getting lost, broken or damaged is higher with LTL freight than with FTL freight.
How Does LTL Shipping Work?
LTL shipping operates on a ‘hub and spoke’ model as part of a series of distribution centers. A distribution center is where goods are loaded into a truck trailer to be transported to their final destinations. In other words, outlying local terminals connect to the central hubs for distribution.
For freight headed in the same direction, the parcels are consolidated into a single truckload. Trucks pick up freight at local terminals then transport it to the distribution centers to be delivered to the recipient, or loaded on another truck before continuing onto the final destination.
In preparation for shipment, LTL cargo is assembled into pallets, crates or large boxes and then shrink wrapped. This minimizes both the risk of loss or damage, and the need for additional handling. Once palletized, freight is stacked and assembled at the distribution hubs for loading.
Different LTL freight shippers also have their own rules on weight and dimensional limits. Generally, LTL freight is a great option for shipments consisting of no more than six pallets or shipments occupying less than 24 feet in a trailer. For security and easy handling, individual packages are packed into pallets, crates, large boxes, bundles or barrels.
The Cost of LTL Shipping
Many factors determine LTL shipping rates. Here are the primary factors that influence your rates for LTL freight shipping:
- Base Rates: LTL carriers establish their own base rates. Typically, rates are quoted per 100 pounds.
- Minimums: The minimum charge is the charge below which a carrier won’t agree upon.
- Weight: The more a shipment weighs, the less you pay per 100 pounds.
- Distance: The longer the delivery distance, the higher the rate you can expect to pay.
- Classification of Freight: Every piece of freight has a classification. The class is determined by product density, value, stow-ability, handling and liability. Lower-class freight is heavy, dense and easy to handle, thus making it less to ship. Higher-class freight is lighter, less dense and fragile.
It is also important to note that truck freight rates are generally charged by the mile. You can expect to pay $2-$4 per mile for LTL freight.
3 Best Practices for LTL Freight Shipping
There are several things you should keep in mind when dealing with LTL freight shipping. Here are some of the best practices.
- Be accurate in documentation: After booking an LTL shipment, you'll receive a bill of lading (BOL). Ensure that the pick-up and delivery address is correct before handing it over to your LTL freight carrier to avoid delay or unnecessary costs.
- Provide accurate freight info: Double-check your shipment paperwork to ensure that you provide accurate freight weight and dimensions to avoid being hit with surprise fees.
- Package securely: LTL shipments are handled numerous times en route to delivery. Stack freight into crates or pallets using tapes and seals to keep your shipment intact to ensure it arrives in good condition.
LTL Shipping with Easyship
LTL shipping is best for shipping small amounts of cargo on a flexible timeline. LTL shipping offers more flexible pricing than FTL shipping, but it is certainly slower. Weigh these tradeoffs as you consider how best to replenish your inventory.
Easyship can connect you with a network of third-party logistics providers and fulfillment centers at no charge. You'll also be able to access discounted LTL freight rates up to 70% from top Freight carriers like FedEx and UPS if you book shipments through the Easyship platform.
Want to start saving with Easyship? Create your free Easyship account now.
LTL Shipping FAQ
What is the Difference Between FTL and LTL Freight Shipping?
FTL means full truckload and LTL means less-than-truckload. With LTL, you only pay for the portion occupied by your freight in a shipping container. But with FTL, you pay for the full capacity of the truck trailer.
Why is LTL freight so expensive?
LTL freight is more expensive because you’re paying per pound instead of by truckload. Since you pay a prorated amount, the average price per pound is higher. This helps the courier offset the risk of potentially running trucks with less cargo.